Outsourcing Business Functions - The Pros and Cons

Is your business growing rapidly, but you are unsure whether your cashflow can handle a full time employee? Then outsourcing could be the best approach for you.

Its not just growing businesses that outsource business functions, many established companies are outsourcing business functions as a cost saving measure.

So is outsourcing the best solution for you?

Business Functions Commonly Outsourced

Outsourcing is common place in many businesses across all sectors.

Some of the most common functions outsourced are:

- Accounting and Bookkeeping

- Payroll Processing

- IT Support

- Sales & Marketing

- Social Media Management

- HR services

- Call Monitoring

The Pros of Outsourcing

Some of the pros of outsourcing business functions are:

Flexible Workforce

You have a flexible workforce which can be scaled up and down as your business requires without committing to a full time employees salary or the risk of redundancy costs should you no longer be able to afford to employ the member of staff any more.

This is especially useful if your business has seasonal trends.

Access to Talent

You have access to a talent pool you may never have had access to before.

It also means that employees to not need to be trained on functions that may not tie into their skill set. Do you really want your sales person being your bookkeeper as well? No you want them to do what they do best and continue to sell your products or services.

Time Saving

Outsourcing can free up more of your time to grow your business, which is vital when your business is still growing.

Outsourcing to an expert can be more efficient than you struggling with a task you are not completely comfortable with. From a finance point of view it can also prevent fines and penalties for filing incorrect information to HMRC.

Handling Employment Issues

Nothing strikes fear in an employer more than an employment tribunal.

With outsourcing you reduce the risk litigation against the business as there are less employees.

The Cons of Outsourcing

Some of the cons of outsourcing business functions are:

Control of Business Functions

When you outsource a business function you may feel like you lose some control. This should not be the case provided you outsource to a reliable business that you trust and can communicate with freely.

Problems With Quality of Service

Unless you make sure the supplier of the outsourced function is reputable and experienced there is always a risk that the service you receive is not at a standard you are happy with.

You need to ensure you discuss your expectations with the supplier and ensure they are reputable.

Loss of Supplier

As with any supplier there is always a risk that the business you outsource too goes out of business.

You need to ensure they are financial stable and able to fulfil the role you require for the longer term.


Some outsourcing suppliers are based offshore. This can cause delays in responses to queries and delays in tasks being completed purely as a result of time differences.

I always recommend that you outsource services in your home country to avoid these issues. The cost may be higher but it will make the process of outsourcing easier and provide piece of mind that you can speak with the supplier during your business hours.


Outsourcing is not for everyone, but embracing it can be the difference between a business thriving and failing.

It can greatly improve cashflow by having a flexible workforce and having the ability to terminate a contract without redundancy payments being required.

It provides you with access to expertise you may never have had access to before and frees up more of your valuable time.

If you are looking to outsource your accounting, bookkeeping or payroll processing call Edwards Bailey Chartered Accountants today on 07851237635 or email Billy at bedwards@edwardsbailey.co.uk.

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