This article was originally published in the American Society of Interior Designers Magazine Publication in the CA San Diego Vol 2, 2020, on August 20, 2020.
To read the original article, click here.
5 Reasons Outsourcing Makes Sense
By Marc A. Molinsky
“Outsourcing” is becoming more popular with interior design firms than ever before. In fact, our research shows that nearly 8 out of 10 interior design firms outsource at least one component of their business to a third party. As labor and benefits costs continue to increase, it has become much riskier and more expensive to hire in-house employees. This increasing demand for outsourcing has resulted in many more businesses popping up within the interior design industry that offer outsourcing.
The most common task that designers outsource is bookkeeping. Bookkeeping is the ideal candidate for outsourcing because it is not a skill that is taught in design school and it is very expensive to hire and manage in-house. DesignerAdvantage, Inc. has become the leading provider of outsourced bookkeeping and ordering services for interior designers because they understand all of the intricacies of the design business.
Other tasks that are commonly outsourced by designers are CAD drawings, purchasing/ordering, social media management and public relations.
One of the newer outsourced services within the industry is the work typically performed by an assistant designer such as sourcing, budgeting, project management and installations. Coupar Consulting, a consulting firm based out of San Francisco, is the first in the industry to offer a unique suite of services for interior designers which includes assistant design work, public relations, website design and social media management.
There are the 5 primary reasons why outsourcing has become more popular in the interior design industry:
Reduce Cost
The most popular reason to outsource business functions to a third party is to reduce costs. Outsourced providers can execute tasks faster and cheaper than in house employees because they hyper focus their business and invest heavily on perfecting that one task resulting in savings and efficiencies for their clients.
Variable Expense
Variable expenses are business expenses that typically increase or decrease along with the size of sales and they can be controlled and “turned off” as needed. Examples of variable expenses are sales and marketing, office supplies and consulting. Fixed expenses are expenses that cannot be turned off such as payroll, rent, and insurance. Outsourced services are considered variable and therefore, are more attractive for your firm.
Focus on what you do best
By outsourcing your firm’s “non-core competencies” you are allowing you and your employees to focus the majority of your time on the aspects of your business that you do best, which results in happier employees, better employee retention and most importantly, a higher level of customer service for your clients.
More time to grow your firm
Your firm will function better and faster when your internal staff are not spending a significant amount of their time the smaller, less critical tasks of the business. Outsourcing allows you to increase the capacity of your firm to take on more business without the expense and time needed to hire and train new employees.
Best Practices
When you outsource you are essentially hiring an “expert” in that particular task and therefore you have access to the best practices in that particular area of the business. Our research shows that design firms who opt to outsource non-core competencies to a third party generally are happy with their decision and tend to commit to those resources long term.
To read the original article, click here.