USA is one of the most economically established countries in the world. With an estimated GDP of $13.81 trillion, USA maintains top position. A large number of USA’s GDP belongs to the service sector which is 78%. USA witnessed a continuous growth in private sector and small businesses for almost 11 years; with an average growth rate of 3.8%- the highest ever in the history of this country. Like its height in GDP, USA does have the best per capita income which is estimated to be $45,850.

Ever since the recession started in the late 2008, USA’s small business sector has been bearing a crisis situation. Many of the giant investment groups declared bankruptcy which resulted in even more pressure on small businesses, as their investment crashed with them. Now to stay in the market, small business sector is working out to cut their cost of operations, and most of them are finding outsourcing as their way out.

Since USA maintains a high ratio of GDP to per capita income, cost of doing business in USA is very high also. What outsourcing does is that; it utilizes the labor arbitrage, which the under developed economies have on offer. For example, GDP per capita income of India is only $2,659, which is far less than USA’s $45,850. That makes a huge difference in salary structure saving cost almost by 70%, while at the same time; a high number of professionals from these under-developed countries are equipped with international qualifications, certifications and experience.

Many small businesses have already utilized this opportunity by outsourcing services like:

1. Marketing (call center)
2. Accounting and Finance
3. Investment Research
4. Software and Graphics Development
5. Content Development

There are many other reasons for which companies are outsourcing except for labor arbitrage, like increased efficiency, reduced risk margin, control over capital and many others. There are many BPO firms providing outsourcing services to USA clients such as iSource Biz.

Whether you are starting a new small business or running a large scale company, your ultimate goal is to generate maximum revenue, and cut your cost as much as possible. Outsourcing can help you do both of them in efficient and effective way. Let’s have a brief look at what outsourcing really is.

Outsourcing is a method of transferring responsibilities, to a separate business entity in anticipation of increasing ROI of capital. Normally, companies are used to outsourcing services like Accounting, Data-Entry, Marketing and many other services.

The most obvious reason of outsourcing is to cut the direct labor cost, since under-developed countries have the advantage of low wage structure over developed countries. But that’s not all, outsourcing has many indirect cost saving features, which are following:

1. It helps in saving your capital cost, because you don’t have to invest in infrastructure and HR anymore. You can take advantage of that additional saving for your capital growth.

2. By focusing on limited type of services, BPO firms are more productive and efficient as compared to traditional style of business operations.

3. You are no longer putting effort in searching for right employees and taking care of the trainings and analyzing their productivity for on-time delivery. That also helps in starting a new project; you just take the order, ask for ETA from BPO firm, and deliver it to the customers.

4. When responsibilities are transferred to BPO firms, you and your managers can take advantage of that additional time to focus on core issues of business, resulting in better management.

5. Since you have got the access to a large pool of qualified and trained staff through BPO firms, now you can equally take part in handling bigger projects, which earlier was only restricted for big players.

6. Stay ahead of the upgradation headache. Since you are not involved in infrastructure and HR development, you are not required to look for the latest technologies in market for optimizing efficiency. It is the responsibility of BPO firm now at the same time reducing your risk factor.