The Art of Outsourcing

A few years ago I had a meeting with a CEO, CFO, and their insurance  broker – we were presenting the best solution for his company and it happened to be a PEO (Professional Employer Organization). This solution was saving his company roughly $300,000.00 – he looked me square in the face and said “I don’t outsource and I never will – regardless of the savings.” I smiled and replied, “Do you use Fedex” to which he replied, “Of course”. He ended up becoming one of our best clients and now we joke about that story, but it’s true and it happens.

Outsourcing has gained a negative reputation and the simple truth is in one form or another everyone outsources – when you dine out you are outsourcing that meal on some level. In our business we are fortunate enough to work with some of the best and brightest minds, surprisingly enough one thing we learned time and again was that the most successful, growing companies focused on their core business and outsourced everything else. Yes, you read that correctly – they didn’t focus on areas of their businesses that they or their staffs didn’t have expertise in.

We would never suggest that our clients are smarter than everyone else, but we notice that almost all of them are highly profitable, have the best of the best talent and they are growing rapidly. It’s no coincidence because they all do the same things – they find efficient ways to get what they need done by an expert in that respective field. Even here at DS we outsource to a PEO, our bookkeeping, all legal and our marketing. The answer is simple why – it costs so much less.

Consider this if we hired someone to do what our PEO does, it would cost us $120,000.00 a year plus insurances, taxes, 401k and so on. Same goes with hiring a full-time lawyer, CPA and a marketing team. If we didn’t outsource we would be out of business rather quickly – so it only makes sense. Now many will argue that outsourcing eliminates jobs – in our case and most of the time those jobs never existed and everything we outsource is US based. Often times we are using our needs to help other solopreneurs and  small businesses grow.

A large part of the reason we created DS was because of the popularity of outsourcing – our goal was to make it efficient, unbiased and easy. As outsourcing gains acceptance in the mainstream we believe it will accomplish two things – the first being it will drive more people to create companies around their specific areas of expertise and the second it will further act to help reduce barriers of entry to business and entrepreneurship.

If you haven’t looked at outsourcing you should – it definitely saves you time, money and eliminate headaches. In that process if you decide to consider outsourcing your payroll, insurances and/or HR– well then you have to come see us. Happy hunting.