Question

What are the Advantages and Disadvantages of Outsourcing a business

Answer 1

Outsourcing a business means to obtain goods or services from any other party who is having expertise in the same.

Advantages of outsourcing:-

1) The biggest advantage of outsourcing is the expert services. Those who are the owners of the business may not have all the expertise knowledge of all the areas of the business. In such cases, if business for that part is outsourced to some other party having expertise in that, can help the business to get the expertise service.

2) Outsourcing the business to someone else can help to save time and because of the same owners can focus more on the other focus areas.

3) Because of outsourcing, one can have the services of the skilled amd professional labour.

4) Owners of the business generally have the control over the outsourced business and because of the same, he can take important decisions for outsourcing business also.

Disadvantages of outsourcing:-

1) The major disadvantage of outsourcing is that the confidential information of the company has to be shared with the outsourced unit, and they can use it for their own benefits or any other wrong means.

2) Also, the cost of outsourced business is generally more than the inhouse cost.

3) Also, sometimes there can be delay in the services which can lead to opportunity loss to the company.

4) Sometimes, due to poor management outsourced unit is not able to funcion properly and provide good results to the company.