How to Start an Outsourcing Company


by Stephanie Fagnani

Companies, both abroad and domestically-located, are increasing calling upon outside vendors to outsource some of their business needs, from payroll to information technology services. The benefits of using a third-party supplier can range from cost savings to convenience, and forming a solid working relationship with a contracted supplier often leads to repeat business and referrals. While starting an outsourcing company may involve quite a bit of research and financial support up front, the long-term rewards can be bountiful.

Conduct market research to determine which services are in highest demand from already established companies. For example, check to see if most businesses outsource their human resources functions like payroll or employee training, or if they seek outside vendors to help with more manufacturing-focused tasks like product design and development.

Determine if you want to specialize in only one niche area or if you want your company to offer a wider variety of services. For example, if you choose to create a business that dispenses employee-skills training you will need to decide if you want to provide training in both technology-based and management-focused skills or only one of those areas.

Calculate how much money you will need to start your new business and secure the financing either from outside backers or your own personal investment. When calculating expected expenses remember to factor in what you will need to pay for business permits you may need, facility costs including leases, staff wages and equipment.

Develop a marketing plan so that you can begin to spread the word about how your outsourcing company can help clients facilitate their day-to-day operations. The Small Business Administration recommends devising a plan that includes “everything from understanding your target market and your competitive position in that market, to how you intend to reach that market (your tactics) and differentiate yourself from your competition in order to make a sale.”

Devise a plan for how much you will charge for certain services. According to “Entrepreneur,” a good approach is one that allows for flexibility in an hourly rate based on how long a specific project might take.

Things Needed

  • Business plan
  • Financial support
  • Educated staff
  • Business permits

About the Author

Stephanie Fagnani has been a professional writer and editor for more than 20 years. She served as an editor at Fairchild Publications, where she presided over the Center Store section of the weekly B2B trade magazine “Supermarket News.” She has also covered the corporate training and education markets extensively since 1997. Fagnani holds a Bachelor of Arts in journalism from Pace University.

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