Outsourcing: the perfect solution to reduce costs

When the leitmotif of the current economic context has become “cost reduction / cost optimization”, an important solution for any company that wants to survive on the market is to outsource certain services that are not related to its core activity, such as: IT services, finance & accounting services, legal and human resources: recruitment, personnel leasing, training, payroll services and personnel administration.

Why is outsourcing an important solution to reduce and optimize costs?

I tried to illustrate below some of the main arguments:

When the leitmotif of the current economic context has become “cost reduction / cost optimization”, an important solution for any company that wants to survive on the market is to outsource certain services that are not related to its core activity, such as: IT services, finance & accounting services, legal and human resources: recruitment, personnel leasing, training, payroll services and personnel administration.

Why is outsourcing an important solution to reduce and optimize costs?

I tried to illustrate below some of the main arguments:

1. Reduces personnel costs:
   • to ensure smooth operation of the IT, payroll or accounting services it is needed to hire a team ready to be committed and be paid proportionally to their qualification and specialization. These costs may be excluded from the start, if the companies choose to outsource these services to a specialized company that invest exclusively in the right team to provide maximum quality to their customers.
   • the lack of projects over a period of time require employers to keep employees on stand by, with the same costs, but without registering any profit.
   • where one of the employees is in a sick leave or vacation and is no longer available, the only thing to be done is to entrust another person with the responsibilities of that unavailable employee. This implies additional costs and the risk of not doing a very good job is very high.
2. Reduce the administrative costs

   Hiring and maintaining an efficient team involves not only costs with salaries but also costs with:

   • rent
   • utilities: gas, light, electricity
   • communications: telephone, Internet
   • catering: water, coffee, etc.
   • furniture (desk, chair, shelves, etc.)
   • consumables (paper, stationery, etc.)
   • computer (in addition with licenses for various programs including Windows, Office, accounting and payroll software, etc.) and IT support
   • cleaning services
     By choosing to outsource these services, those costs can be reduced or even totally eliminated.
3. The managers can concentrate on core activities of the company
4. Reduces the risks of not applying all legislative changes correctly, receiving advice from the supplier, which has expertise in that area
5. No longer needed investment in accounting, salary calculation and legislation up-graded programs, as the service provider is responsible for these additional costs
6. Constant flexibility with respect to customer’s expectations whenever company statements and reports are required, in the format agreed between the parties

The studies show that a company can save up to 21% of costs by outsourcing human resources services and up to 25% – 30% by outsourcing the accounting services.

There is no doubt that outsourcing is the only solution for maximum optimization of costs in any business, being in crisis or not.

That is why, istarting with 2004 Ascent Group developed a range of services and activities, in order to help the companies that want to outsource the related services (human resources, accounting, legal), but also the companies that want to maintain these services in a package offered by the same supplier, to have a single interlocutor and to have a permanent global view of the various components of its business.

Outsourcing is the only one solution to survive the current economic crisis, but also an eternal valid solution for companies that really want to invest resources and energy on core activities, leaving in the hands of experts the related activities.