Expand and gain access to new market areas.

5.Outsourcing involves the retention of responsibilities for the services by the purchasing organization but the devolution of the day to day performance of those services to an external organization under a contract with agreed standard cost and conditions. This is a strategic decision to utilize the expertise of a supplier rather than perform the service or make the goods in the house.

Reasons for outsourcing

1. Improve Corporate Focus on Core Business Process.

Companies prefer outsourcing, offshore for most of the outsourced tasks are time-consuming, therefore it would affect the efficiency and effectiveness of the company. Outsource professionals can get the job done as quickly as possible and the best part is you do not have to allocate funds on equipment or facilities to provide your resources with. Therefore, you can focus more on your business.

ii Free up internal resources.

Freeing up internal resources enables your company to utilize internal resources more efficiently and effectively. It allows your company to use it for other purposes and this would absolutely be a benefit to your company not only can you free up time but also capital to drive your business forward.

iii. Gain access to resources not available internally.

Every company has their own limit on the resources available to it. There are so many times where a company is stranded with internal resource crisis, thus having your business be outsourced can let you gain access to resources not available internally. This will lead to getting more ideas and more resources; hence, the result is a creative output.

1. Access to better services.

It helps an organization to have that easy access to the better services and this will help the organization to operate without any problem that is affecting it

1. Delegate functions that are difficult to manage and control.

Outsourcing gives you an opportunity to free yourself from the task of hiring resources while downsizing your personnel. You can just dissociate for functions that are difficult to manage and control while acquiring benefits. You are free from all your additional responsibilities once you outsource your business because they usually have much more knowledgeable personnel. You will get the benefit of industry experts rather than being stranded with just one person with a limited worldview.

1. Help company reduce risk.

Every business investment carries a certain amount of risk. But by outsourcing, it can take over and manage this risk for you. Therefore, risk management becomes easier if you outsource your company. Not only can it help you minimize risk by sharing any associated risks, but also it will drastically reduce your burden.

vii. Expand and gain access to new market areas.

Outsourcing enables a business to delve into new opportunities and field of expansion. This can be done by taking the point of production or service delivery closer to their consumers. In this way, you are now capable of gaining access to new markets and establishing local presence ahead of your competitors.

viii. Gain access to world-class capabilities.

It enables the company to have an access to the latest and the most advanced technology to date without investing in software implementation and customization process including the best engineering practices. By outsourcing diverse and talented individuals, it will provide your company a fresh mindset that helps your business stand up to the competition. When sustainability and profitability work together, your goals for impact and growth will follow. Therefore, establishing a higher goal or even better, a globally relevant one.

Subcontracting

This occurs when an organization request another organization to undertake work which it may be capable of doing itself on its behalf within a short tim. Subcontracting generally is concerned with the breaking down of core production processes of an organization, the broken down processes are further delegated to other organizations (subcontractors) who have better knowledge about such processes.