As a startup owner in the early stages, you may need your team to concentrate on your core business in order to create a stable revenue source for the company. However, in some cases, their efforts can be hindered by a lack of IT expertise, skills, and knowledge, or by manual processes, paperwork, and human error. 

Most startups don’t have enough time, resources, or money to hire and train new IT staff to fulfill these tasks. As a result, the core team is expected to do all the work, which can lead to burnout and have a negative effect on business performance. 

The best way to avoid this scenario is to outsource IT services, which means hiring a third party to do some certain work. This method allows startups to grow and stick to their goals, without affecting the product’s or service’s quality or the in-house team. 

How outsourcing can be an effective solution for startups

The timing, funding, team, and idea are key factors to any startup’s success. Below is how outsourcing can help them with these issues. 

1. Outsourcing saves startups time

Time savings is the main reason why startups outsource. By letting people with more experience, expertise, and knowledge handle your specific tasks, you can save a lot of time so your team can focus on the core business. For instance, to build software internally, you must hire and train a development team, which can take months or even years to complete. But outsourcing to a partner can allow you to release the software faster. 

Or, when you outsource IT staff augmentation, the hiring and onboarding processes will be streamlined. This is because the IT contract staffing vendor will be responsible for recruiting and hiring qualified staff as needed for your project. 

2. Outsourcing saves startups money

For early-stage startups, outsourcing is the best option to cut costs. According to a survey, most companies admitted that hiring an external team helped them reduce business expenses by 60-70% compared to building an in-house team. Why? Because the outsourced developer or team does not require such expenses as hiring, training, onboarding, taxes, insurance, social welfare, etc. You also don’t need to purchase equipment or office space for staff to work.

Countries with a low-cost labor force and high-quality outsourcing services include Vietnam, the Philippines, and India. These countries, especially Vietnam, are the cheapest destinations, with low cost of living, but young and highly-skilled workers, dynamic economy and strong government support for tech industry. Therefore, outsourcing to the low-cost countries, if done correctly, can help startups grow their business without burning money.

3. Outsourcing gives startups access to global talent

When you outsource IT services, you will have access to industry experts. These people can help you target your IT needs and offer you better and innovative ideas of where to start and what to improve.

Even if you’re a great businessman, you still need to know how to surround yourself with individuals who will help your company succeed. In fact, you can’t have talents in every field. Outsourcing is a business strategy to access talent and expertise. With it, you can connect with qualified professionals from all over the world and delegate tasks to them effectively.

Having access to global talent also means expanding access to new technology trends. Several outsourcing providers such as EXE Corporation have partnerships with top universities and professional organizations for IT specialists and engineers with a wide range of skill sets, knowledge, experience and certifications. 

Hiring the right and high-quality people is crucial for startups in the early stages. Therefore, outsourcing is a great way to begin. 

4. Outsourcing enables a new way of working – remote or hybrid working

The need for remote workers has never been greater as the world of work constantly changes. Businesses that use technology are increasingly seeking out services that may be performed remotely. According to the figures, outsourcing will play an important role in business operations this year and beyond as organizations strive to create hybrid teams that include both in-house employees and remote workers.

Building a hybrid team culture has many benefits, including world-life balance, reduced costs for companies, improved flexibility, increased productivity, more control over work, more efficient use of time and so on. This type of working method is beneficial from the employee’s perspective, the IT job’s perspective as well as the employer’s perspective. 

5. Startups can improve their internal processes and increase efficiency with outsourcing

For non IT companies, outsourcing software development and other IT related services can save them time to focus on what they do best, therefore, increasing efficient operations and profitability. For IT companies, outsourcing provides more resources and expertise to help them scale their teams quickly, deliver products to market faster.   

Your startups may be skilled in one certain area, but when it comes to other areas, your professionals may be lacking, especially in the digital age that requires changes and adaptability. Outsourcing provides up-to-date systems, technology, tools and staff, helping your startup replace poor internal service and skills to create a better working process. 

Outsourcing as a business strategy for startups during recession

With more economists predicting global recession to be worse in 2023, this year could bring some challenges for startups who are seeking to reduce spending and boost profits.  

Many business owners worry that hiring an outsourcer will only increase expenses and add unneeded overhead, which is not suitable for a recession period. But it is quite the reverse! Outsourcing is a growth strategy to free up time to focus on the core competencies, reduce certain costs, improve skills, manage risks and avoid burnout. 

In an economic downturn, outsourcing is considered the best choice for startups to maintain their agility and flexibility while expanding their team and cutting expenditures. You can ensure high-quality products and services without having to build an in-house team. Moreover, working with an outsourcer can help you absorb demand shocks, acquire new skills and industry, as well as sharing knowledge with external experts. 

Partnership with EXE Corp – IT Service Provider

EXE’s mission is to provide endless opportunities for companies to unlock their inner innovators. 

EXE IT outsourcing benefits:

For the following industry, we can build a strong and efficient team for you.

  • Education
  • Insurance
  • eCommerce
  • Finance and Banking
  • Healthcare
  • Fintech
  • Manufacturing