Experts can be turned on like a tap

Small businesses with big ambitions but limited budgets can get access to a high level of expertise by outsourcing - Source: Sunday Times

Rose Gamble

FORGET the image of the lone entrepreneur struggling to do everything by himself. Outsourcing can enable the small-busi-ness owner to do a wide range of jobs better, faster and more efficiently. It can also give him access to a level of expertise and experience he is unlikely ever to have in-house.

Judith Hunt and Steve Connolly founded Bizunlimited, a community for business owners. With just two full-time staff, a limited budget and an office in a spare room, they have outsourced many of their business operations, including IT support and accountancy.

“I am outsourcing because I do not have the staff, the budget or the equipment,” said Hunt. “Also, I don’t need full-time staff in some areas.”

What Hunt does need is expertise. The success of her business depends on her ability to market a new concept. Bizunlimited promotes and supports the business owner through networking events, workshops, advertising and, more unusually, an online banking system that allows members to trade between themselves using a special community currency. Hunt realises that marketing a new concept is a challenge and so has chosen to outsource her sales and marketing to a team of experts.

“The key to the success of this venture is to reach a commercial tipping point of 1,500 members as quickly as possible,” she said. “Only a team of trained experts could get us there.” Hunt has formed a partnership with a telemarketing company, New Business Generation, which is running her marketing campaign.

“Outsourcing our sales and marketing has numerous benefits for us as a new company,” she said. “It is flexible. We can experiment with various app-roaches at a low risk and we can assess the value of having an in-house sales team before committing ourselves to the investment.”

The experience and advice of New Business Generation’s managing director, Mike Segall, has also proved invaluable.

“Through his contacts we have been able to run this campaign by targeting geographical areas,” said Hunt. “We would not have got to where we are today without Mike and his team.”

Richard Fifield, national head of outsourcing at Tenon, the business advisory service, said a successful outsourcing partnership will always include some element of advice and consultancy.

“Consultancy comes with a supplier,” he said. “They are pretty much inseparable. Outsourcing will come with solutions to problems.”

Daniel Ross, co-founder of the motoring lifestyle magazine Intersection outsourced primarily to get the consultancy that came with the services he required. Ross founded Intersection with his business partner, Yorgo Tlou-pas, in 2000. The pair had previously been the creative team at a large publishing house, but they had little experience of running a business.

“Yorgo and I tried to take over the many jobs for which we could not employ staff,” he said. “We saw that we could create one of the best magazines in the world without being part of a corporation. But we needed help in getting organised and learning how to run a business.”

The pair required expertise, advice and financial services that would stretch beyond what could be supplied by an accountant or bookkeeper. Yet, with a limited budget, a full-time finance director was not an option.

Ross went to FD Solutions, which provides experienced finance directors, and found the solution in the shape of Simon Walters, who now acts as part-time finance director for Intersection. For Ross, the relationship is ideal - he gets financial advice when he needs it.

“Simon helps us to manage the company by providing constant feedback on operations and strategy from a financial viewpoint,” he said. “We are able to draw on this array of services on a ‘wherever we need, whatever we need’ basis, paying only for the hours we use.”

Ross also recognises that outsourcing has given him access to a high level of expertise, which has remained essential to the success of his business.

“Best of all is knowing, as a small business, that a world-class finance director is taking care of our needs and helping us to grow,” he said. “In many ways Simon is the third partner in our business and, without his involvement, I doubt we would have been able to succeed.”

Outsourcing is flourishing, offering benefits for people on both sides of the fence. Walters of FD Solutions has seen his company grow rapidly as demand rises for its outsourcing services. He puts this down to the fact that flexible, professional services are often just what a small business needs. “More and more companies are seeing the advantage of outsourcing to an expert, whose services they can turn on and off like a tap,” he said.

With flexibility comes financial viability. Increasingly businesses are realising that employing a core team of staff and outsourcing various jobs is more efficient than paying full-time salaries in-house.

Modern technology has also made outsourcing easier than ever. The internet, e-mail and the Blackberry have made the process of finding - and then communicating with your expert - quick and efficient. “With modern technology we can be available as if we were in the next-door office,” said Walters.

So with a host of experts at your fingertips and the freedom to use their services when they are needed, outsourcing can provide a vital boost to your business.

TOP TIPS
Spend time researching the companies and individuals with whom you intend to form a relationship

If possible draw up a service level agreement - or contractual agreement - with your supplier

Once you have made an outsourcing deal, establish a good relationship. This will require constant communication

Clarify the terms on which you and the supplier are working

Try to commit to a long-term relationship with your supplier - this will produce the best results

National Outsourcing Association noa.co.uk

Small business advisers tenongroup.com

The basics on outsourcing businesslink.gov.uk