What exactly your business does is one of the first questions that any self-respecting entrepreneur needs to ask themselves. Knowing your core role is essential for understanding what you need to do to succeed.
Businesses have long known that they don’t need to do everything in-house. Some services they can buy, often for much cheaper than if they tried to implement them themselves. But which functions do the most successful entrepreneurs outsource? Let’s take a look.
If you want to create consumer products, you might think that manufacturing them would automatically fall within the scope of your firm, but you’d be wrong. Hardly any of the biggest brands in the world make their products. Instead, they outsource the task to a third-party, once they settle on a design.
This state of affairs might sound a little strange, but there’s a good reason for it. Most consumer product companies (especially startups) don’t have manufacturing expertise. They lack the capital and organizational structures to fabricate products at scale. That’s a specialism that the manufacturers themselves have.
Beliving that you have to both design a product and make it at your facilities is a very 19th-century idea. It no longer applies in the modern economy.
Traditionally, businesses dealt with human resources issues in-house. HR departments grew out of a need to manage employee pay and sick leave. The problem, though, is that it is time-consuming. Worse still, it is not actually a core part of your business that makes it unique. Pretty much every company has to manage its people.
Successful entrepreneurs recognize that administering HR needs in-house is a drain on their time and resources. Many, therefore, choose certified payroll management services to take over the task for them. Professionals working at a third-party agency deal with all of the business’s staff-related issues, freeing up senior executives to focus on market-specific needs.
The CFO has long been a part of the governing structure that makes organizations tick. While some large firms need a full-time CFO to manage the financial aspects of their operations, the majority do not.
Smart entrepreneurs know this, which is why many of them now use “fractional CFOs.” Instead of paying a full-time executive salary, you hire the CFO services you need periodically, cutting your overall wage bill.
Is your office a core part of what makes your business unique? Almost certainly not. It’s just a space you use to get work done.
You don’t need to own and manage your office in the modern economy. You don’t even have to arrange cleaning or replenishment services. All-inclusive officers provide everything you need to keep your employees happy, with none of the usual administrative hassles.
Go back thirty years, and practically all companies had in-house marketing departments. Since the millennium, though, executives have realized that they often get better value and results from third party agencies. Marketing agencies have the expertise they can’t get in-house.
Is it time you scrapped your marketing department and outsourced it instead?