There are several ways to grow a small business. You can try to expand your product or service base, take out a loan to hire more staff or invest in more square footage, or really push your marketing efforts to reach a broader audience. If you’ve already tried these strategies for growing your small business, though, you may want to consider another option: hiring contractors.
Contracting out various elements of your operation to other companies that specialize in those tasks is a cost-effective way of growing your business and can actually encompass several of the other strategies noted above. The key is to identify your business’s weak points or where you need a staffing infusion and choose contractors based on those needs.
Individual Contractors Or Outside Companies?
Many people work as independent contractors – functionally consultants – in today’s gig economy. Before you start hiring, though, it’s important to determine whether the tasks you need performed, and the amount of work involved, should technically be done by an employee or contractor. The IRS has strict rules for categorizing who is an independent contractor and who is an employee, so be sure to consult these.
Compared to hiring an independent contractor, when your business contracts with another company, you’re simply employing them for their services. This has several advantages. First, you aren’t responsible for insuring or handling payroll for these workers. Second, as one freight handling company describes itself to clients, their workers’ can be viewed as a secondary workforce for your company. Suddenly your business has the manpower necessary to tackle a variety of tasks, but without the costs of onboarding, benefits, and other major expenses.
Access To Tools And Technology
Another major advantage of hiring outside companies to support your business is that they often have access to specialized tools and technology that your company otherwise couldn’t afford. This is often the case when contracting with industrial firms, as well as in tech-heavy industries like IT, finance, and even HR. Indeed access to intellectual capital coupled with the ability to take advantage of costly, high-value technology are among the top reasons for outsourcing’s growth. Companies need to act as partners for everyone to thrive.
Are There Problems With Outsourcing?
Outsourcing and working with contractors can help your business thrive, but there are any major concerns with going down this path? Among the potential issues working with contractors creates is a loss of control over the hiring process, the challenges of managing a remote team, and the loss of a coherent workplace culture. Most companies will still say such partnerships are worthwhile, though. Even with a lower degree of control, the financial and productivity improvements are substantial.
Small businesses should always remember that they have choices when it comes to growing their business, but contractors should be at the top of the list. From growing your staff to boosting your technical access and enhancing your focus on core operations, small businesses need partners who support their goals to succeed.