Rural Outsourcing Gaining Traction in the U.S.

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Outsourcing was a hot topic in the recently concluded U.S. elections and it looks like it’s going to be in the news for a while. The U.S. economy is far from recovered and there are Americans who are still crying foul over the loss of their jobs to cheaper workers from India, the Philippines, Brazil, and other outsourcing destinations around the world.

Meanwhile, some American companies found a viable alternative to offshore outsourcing. The word on the business district nowadays is that you can find cheap, quality labor in quite, little towns of rural America. In the article “Forget India, outsource to Arkansas,” CNN Money claims that hiring rural workers can save companies 25% to 550% in labor costs.

rural outsourcing
A sign of the increasing popularity of rural sourcing or onshoring, as rural outsourcing is also referred to, is the establishment of companies that offers rural outsourcing services. These include Rural Sourcing Inc.,Onshore Technology Services, CrossUSA, and Rural America Onshore Sourcing. These companies are pirating small town workers from fastfood restaurants and supermarkets to train and work as IT specialists and call center workers.

Industry analysts estimate the value of the rural outsourcing market in the U.S. to be $100 million a year. Compared to the $60-billion offshoring industry, this segment of the outsourcing industry is too small. But with US President Barack Obama’s anti-outsourcing rhetoric, it is not impossible for this segment to grow by leaps in the following year.

Rural sourcing and its effect on nearshoring

At first glance, it appears that nearshoring destinations like the Caribbean will suffer from the growth of onshoring.  This might well be the case but not in the immediate future. Rural outsourcing is still in its infancy and it would take a while before it can have a mature workforce and scalable infrastructure to offer to big companies. Jamaica and other Caribbean outsourcing destinations, with their skilled, English-speaking workers, can still bag U.S. clients who are looking for outsourcing providers near the mainland.

In a similar fashion, there are also companies who think that rural onshoring could also be extended to rural offshoring. In this  concept, northern American companies are not only looking at American rural towns, they are also looking at nearshore rural towns that can be used for offshore destinations.  In this regard, Caribbean towns have much to be hopeful for. With the right infrastructure in place and skilled workers, there is no reason why offshore centers can’t be established rural Caribbean.

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Administrative Outsourcing 101: Popular Administrative Services

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Administrative outsourcing has helped a lot of businesses improve backoffice efficiencies, realize operating cost savings, and make management easier. Because of these, more and more companies, both big and small, are outsourcing their business processes to third party service providers. Here are some of the most commonly outsourced administrative tasks:

Secretarial services

If you are are start-up entrepreneur with a small business to run under a limited budget, you will save a lot of money by outsourcing your secretarial services to an offshore service provider with affordable service rates. These services usually consist of:

  • arranging appointments
  • managing business and social calendars
  • making travel arrangements
  • checking voice mails
  • managing online backup of documents
  • placing orders for office supplies
  • transcribing recorded meetings and draft minutes of the meetings
  • taking notes during business calls
  • managing multiple email accounts
  • fax sending, receiving, and forwarding
  • PDF creation and conversion
  • preparing powerpoint presentations
  • creating spreadsheets with charts for analysis
  • processing word documents

Research services

Some businessmen or executives just don’t have time to do research for reports or business presentations. An author writing a book may also need the services of a virtual outsourcing company for online and offline research. A virtual outsourcing provider can do research on the following topics:

  • leads for the business
  • alternatives to technologies being used by the company
  • keywords that can be used for search marketing and search engine optimization tasks
  • reference materials for an info product
  • competitor activity

Marketing Services

A company’s marketing activities is composed of both online and offline campaigns. A virtual outsourcing company can be a key figure in these efforts, especially in the Internet marketing activities of the company. A nearshore virtual service provider can take care of the following tasks:

  • Crafting email newsletters and sales copies
  • Send emails to prospective clients
  • Prepare ads to be posted on classified ads sites like Craiglist
  • Write copy for landing pages
  • Submit to web directories and article directories
  • Manage online press releases

Bookkeeping services

Dealing with numbers is not something that most entrepreneurs like because it requires them to sit down and do the books. Outsourcing this task to a virtual bookkeeping service is easy and cost-effective. Usually, a virtual bookkeeper offers the following services”

  • Invoice creation
  • Monthly and annual financial report generation including expenditure reports, income statements, balance sheet, etc.
  • Payroll processing
  • Settle payments
  • Process refunds

Finding a nearshore administrative outsourcing provider can do wonders for your business. If you are in the North American region, consider outsourcing to the Caribbean. There are a lot of companies in the region that can offer you affordable outsourcing services.

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Administrative Outsourcing 101: Do You Need to Outsource?

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admin support servicesWhen talking with prospects, it is our experience that clients already know that they want to outsource some of their business processes. However, they want to be convinced that they are making the right decision for their business. They want to know what administrative outsourcing can do for their business, particularly their bottom line. Therefore, we have come up with possible reasons why businesses need to outsource. Here they are:

  • Need to cut costs. This is perhaps the best reason of all. What makes outsourcing attractive to so many businesses, both big and small, is that it literally translates to savings in operating costs. A study conducted by the Everest Research Institute revealed that outsourcing could afford to businesses to realize operating cost savings of about 35% to 40%. That’s really HUGE in the current economic climate.
  • Need to increase efficiency. Most businesses outsource processes that their employees don’t seem to want to do. By choosing outsourcing providers who specialize in that kind of processes, there is often a marked improvement in efficiency and productivity levels.
  • Need time to focus on growing the business. When you’re doing administrative tasks in-house, it is inevitable that you will spend time supervising the people doing it. By outsourcing business processes, you reduce the time spent on managing people and increase the time allotted for tasks that can help grow your business.
  • Need to increase the scale of operations. A growing business translates to a growing staff. Recruiting, hiring, training, and managing people is time consuming and requires more investment. If you don’t have the resources to hire more people, then a feasible alternative would be to outsource to a third party service provider who can do the tasks that you need. You don’t have to worry about human resource management issues that come up as a result of having a large staff.
  • Need to simplify management. As we’ve mentioned above, outsourcing allows a small business owner or company executives to reduce the time they spend on managing people. They can keep their staff to a bare minimum and just let their third party service provider to worry about managing the people employed to do the outsourced tasks. They can spend their free time working on things that can make their businesses successful and profitable.

These are just some of the reasons why companies outsource their administrative support services. Use this knowledge to convince your prospect about the feasibility of entering into an administrative outsourcing agreement.

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5 Accounting Tools You Use to Outsource Your Bookkeeping

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Virtual bookkeepers are a big help to any small businessmen who hates dealing with numbers and anything that’s remotely connected to accounting. Still, we do advise our clients to cultivate a little knowledge of bookkeeping and accounting so they’d be able to assess if there is anything amiss in the work of their virtual bookkeepers. One way for that to happen is to use easy-to-understand accounting software. Below is a round-up of some of five popular accounting software among small businessmen.
  • Quickbooks — This is the number 1 accounting software in the market. More small businesses use this software than any of the other software combined. The free online version allows you to create and manage invoices, track sales and expense, and apply sales tax. You also get access to more than 20 business reports for your business. The paid versions have more features. free accounting software
  • Less Accounting — This is a paid accounting application, though you can try the software for 30 days for free. You can choose from three pricing plans, the cheapest of which is the $12 per month plan where you can get access to invoices and expenses and a limited number of reports.

online accounting software

  • Lite Accounting – Self-proclaimed as the most affordable invoicing solution, it offers three plans for the small businessman, including a free plan. Unfortunately,  the free plan doesn’t offer much. You can add as many products, services, and customers as you like, but you can only send five invoices per month and you don’t get to customize your invoices to reflect your brand.  online accounting software
  • Peachtree — Sage Peachtree is an accurate, easy-to-use accounting software that provides the insights and control needed for businesses that are committed to getting the numbers right and improving results. If you buy the product, you get free shipping, free support, and free online training. The latter perhaps is the product’s main attraction for many small businessmen who don’t have time to figure out how their accounting software works. Trial is free for the first 30 days. After that, you have to pay for either Sage Peachtree Accounting or Sage Peachtree Quantum.  
  • Outright – This free accounting software is for people who don’t want to record expenses—or miss deductions, deal with bookkeeping, or think about what to send the IRS but DO want to be instantly organized and ready for tax time, have an up-to-the-minute snapshot of how business is going, and use a simple and free accounting solution. It works perfectly with Harvest, Freshbooks, and Paypal A very handy tool if we may say so.  free online accounting
These are some of the best accounting tools that you can use to manage the financial aspects of your business and share with your virtual bookkeeper. If you need any assistance managing your books, do contact us and let us know how we can make your business life easier.
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Virtually Outsource Your Payroll Needs

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One of the most challenging tasks that small business owners face is finding a competent assistant to help with the payroll processing. It is a very meticulous job that requires mathematical skills as well as a love for details and the ability to work under time pressure. Thus, it only figures that this job be assigned to someone who is not highly capable, dependable, and reliable. After all, you do not want your employees knocking on your office door and complaining that the human resource assistant computed the paycheck wrong and didn’t send the salaries to their banks on time. That’s just not a human resource nightmare that you do not want to deal with.
virtually outsource your payroll needs

A viable alternative to hiring a few human resource assistants to deal with wages is to outsource your payroll needs to a company that provides payroll services. Virtually outsourcing your payroll accounting makes sense if you have more than 20 employees and you cannot afford the costs of hiring payroll assistants to handle wage accounting, tax obligations, and management reporting. And once you have outsourced your payroll needs, you can forget about it and focus on running and growing your small business.

So, what do you look for when choosing a payroll outsourcing provider? Here are the essentials.

  • Technology — A payroll outsourcing provider will have to provide you with payroll software that will collate the information they need to compute employee wages, benefits, and taxes. It’s better if the technology they are using are at par with the industry’s latest because it will allow you the opportunity to choose whether payroll will be delivered as paperless payroll, online payroll, payroll debit cards, and employee self-service.
  • Accuracy —  Payroll computing is a serious business. An inaccurate computation can mean a disgruntled while or a loss for the business. Choose a payroll outsourcing provider who can demonstrate the accuracy you need and offers to pay any penalties that result from miscalculation and late payouts.
  • Customer Service — Payroll outsourcing ought to be like plug-and-play USB device. Once, you have outsourced it, you should be able to forget that a third party is doing your payroll and feel like it’s being done in-house. However, should any problems arise, you need to be able to contact your payroll outsourcing provider immediately. And that means being able to speak to them on the phone.

Payroll accounting need not be a headache. Get help now and virtually outsource your payroll needs.

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Don’t Let Virtual Outsourcing Demoralize Employees

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With the global economy still struggling to recover from the losses of the past few years, many employees spend a portion of their time worrying if they are still going to a have job a few months from now. So, when a small business owner or an executive makes the decision to virtually outsource their business processes or their information technology, it’s a natural reaction for the employees to feel threatened and insecure about their jobs.

As an employer, you don’t want this to happen. A demoralized staff can lead to productivity losses, which could ultimately affect your bottom line. You can avoid this by doing the following:

  1. Make sure that you explain to your staff why you are virtually outsourcing your tasks. The decision to outsource is a major decision that affects everyone in the organization. Regardless of how you present it, it will still be considered as bad news. Don’t aggravate the situation by keeping the decision under wraps and cause tongues to wag. Once people start talking in hush-hush tones, the decision will only be met with more negative attitude.
  2. Prioritize outsourcing difficult tasks. One way to get your employees on board with virtual outsourcing is by making their jobs easier. Ask your employees what tasks they don’t like doing the most and see whether those can be outsourced. You might discover that a lot of it maybe repetitive administrative tasks that are easy and cheap to outsource.
  3. Delegate tasks. Since your full-time, permanent employees will get their workloads lightened up, you can delegate some of your tasks to them and assign them jobs that require more responsibility and accountability. These are the jobs that will bring more job satisfaction to your employees in the long run.
  4. Get your employees to train your contractors. Start fostering a good working relationship between your employees and your contractor by asking the former to train the latter. But don’t assign it to just anyone, ask for volunteers. Getting an employee who feels negative about the outsourcing to train the contractor is a recipe for disaster. Avoid it at all costs.
  5. Host a virtual event for your employees and contractors. Many outsourcing relationships fail because the contractor does not understand the corporate culture of their client. You can easily solve this issue by orienting your contractor to your organizational dynamics through a virtual gathering.

web outsourcing

Virtual outsourcing can benefit your business a lot if it’s carried out the right way. Start by getting your employees excited over the prospect of outsourcing and you’re a step towards forming a successful outsourcing partnership.

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Virtually Outsource Administrative Tasks

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Administrative work can keep you from growing your business. This is a lesson that many start-up entrepreneurs learned the hard way and one that you will wish to avoid if you are planning to start a business or just launched your one. And it’s not a difficult to avoid committing this mistake because now you can virtually hire a contractor to help you perform administrative tasks. In fact, you can virtually outsource the whole administrative function to a virtual outsourcing company if you so desire.

But just to give you a general overview of what tasks you can virtually outsource, we’re listing here the most common administrative tasks that small and medium-sized companies outsource to third-party service providers. Here they are:

  • Organize online documents – We live in a digital world. It’s good practice to keep a digital copy of every document that you sign including invoices, contracts, vouchers, purchase orders, etc. Instead of wasting time organizing all these digital copies and keeping online backups, you can virtually outsource this task. The only thing you need to do is scan the document and send it through email.
  • Receive and send faxes – Even though your virtual outsourcing solutions provider is located in another part of the world, they can still receive and send fax using your business number through e-fax.  At the end of the day, just ask for a summary of what those faxes contain. Don’t forget to ask them to file the fax for future reference.
  • Place order for office supplies – Make a list of what you want including any specifications and then ask your contractor to make the order on your behalf. You can avoid long waits on the phone or exchanging numerous emails with the customer support of the vendor.
  • Process paperwork – We’ve never seen a solo entrepreneur who likes sitting down and doing paperwork. This is one of the admin tasks that you can virtually outsource without blinking an eye. Just to give you an example, we’ve handled a real estate client who asked us to check and collate bids submitted by real estate agents and their clients through email.common administrative tasks
  • Manage a general email account – Since you can’t be glued to your computer 24 hours a day, you could certainly use the help of contractor in answering all emails that come from your customers and suppliers.
  • Prepare presentation materials – Do you need a PowerPoint presentation for a talk that you’re going to give? You can virtually outsource that.

These are just some of the common administrative tasks that you can outsource to a virtual outsourcing company.  The kind of tasks that you will outsource will depend on the nature of your business.

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The Golden Rules of Virtual Outsourcing

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outsourcing to the caribbeanAsk anyone who’s virtually outsourcing their business processes now about how it was when they hired their first contractor and they will tell you that it’s very stressful. The search for the perfect contractor who can help you run your business smoothly and efficiently is difficult process and even the cautious employer can fail and hire the wrong contractor. What do you need to do in order to make sure it doesn’t happen to you? Simply follow the golden rules of outsourcing.

  • Follow your instincts.  Since you are not meeting your potential hire in person, you must rely heavily on your intuition and people-reading skills. Interview applicants and bidders and see how you connect with them. Ask questions of both professional and personal nature. If you sense something odd about the person you are interviewing, then scratch him or her off the list. You need to be able to trust your contractor.
  • Check references. If you are dealing with an experiences contractor, ask for references and contact those references by phone. You will know if that person does exist and you will get an idea of what it’s like to work with your potential contractor. If you are dealing with an inexperience contractor, ask for colleagues or any professional contact that they can give you.
  • Do a trial project or period. Protect yourself from getting stuck with unreliable contractors by starting with small projects. Do not try to overwhelm your contractor with too much work. Increase the volume of tasks and projects once you have a general idea of the capability of your contractor. Alternatively, you can agree to a trial period of two-weeks or a month after which you can decide whether you want to continue using their services.
  • Train constantly. Just because you hired a contractor, it doesn’t mean that you don’t have to train them. If you want things done the way you want them to, you still need to train them on your processes. This will allow them to behave like they are a real part of your team.  Training can be virtually done through videos and virtual events like webinars and teleseminars.
  • Maintain constant communication. The key to a successful virtual outsourcing partnership is communication. Require daily reports and make yourself accessible to your contractor at all times for emergency purposes. Set aside time for weekly meetings just to make sure that you are on top of things.

Follow these golden rules of virtual outsourcing and you will never go wrong.

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Ohio Bans Offshore Outsourcing

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ohio bans outsourcingIn a move that sent tremors throughout the outsourcing industry, especially in India, Ohio Governor Ted Strickland signed an executive order in August 2010 that bans offshore outsourcing of government IT and back office projects.  The decision came after the government discovered that Parago Inc., a Texas-based company hired to monitor the rebate program for new energy-efficient appliances, outsources its call center operations in El Salvador.

In his official statement, Strickland cited “pervasive service delivery problems with offshore providers, including dissatisfaction with the quality of their services and with the fact that services are being provided offshore” as reasons for banning offshoring of government projects. The reaction is expected considering that there’s a growing opinion among Americans that jobs should be kept within the country to solve unemployment problems.

Indian companies, especially those providing IT sourcing services, are crying foul over this blatantly anti-outsourcing policy of Ohio. Infosys, Wipro, and Patni holds multi-million state-level IT outsourcing contracts, which they could eventually lose once the contracts expire. This could mean loss of jobs and, possibly, bankruptcy. The National Association of Software and Service Companies (Nasscom), India’s leading IT lobbying group, released a statement declaring Ohio’s ban on outsourcing as counter-productive to the US government’s efforts to reduce the public deficit. The group further expects more anti-outsourcing rhetoric as the November election draws near.

From an economic point of view, Indian Minister of Commerce and Industry Anand Sharma said that following Ohio’s protectionist policy could only hurt the recovery of the global economy. “When the global economy is still reeling from the aftershocks of the economic crisis and coming out of the recession any inward looking step of protectionist measure would slow down the pace of recovery and deepen the recession,” Sharma added.

While Nasscom is studying the legality of the executive order, officials from the U.S. and India have come to the negotiation table in order to iron out issues brought to light by Ohio’s ban on offshore outsourcing. A joint US-India statement has been released saying that both parties will work hard towards resolving those issues before U.S. President Barack Obama makes his state visit to India.

Ohio’s ban on offshore outsourcing of government and IT projects could spark a series of protectionist policies that will significantly impact the outsourcing world, including virtual outsourcing companies. Yet there is hope that this anti-outsourcing talk will last only until the election and no concrete steps will be taken to prevent governments to outsource projects to offshore service providers.

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Outsourcing Hotspots to Watch

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The outsourcing industry is growing and it will continue to do so in the forseeable future. Coupled with this growth is the rise of new market players that aim to get a larger slice of the outsourcing market.  In this article, we’ll identify outsourcing hotspots – regions that are expected to dominate or figure in the market in the next couple of years.

  • Continental Asia – India and China are expected to remain as top two outsourcing destinations  in the world.  It has established outsourcing operations that appeal to clients, not to mention high level of educational attainment and English proficiency of the labor force. However, increasing labor costs, geopolitical instability, and intellectual property theft incidence become deterrents for many potential clients, especially those that deal with highly sensitive information.
  • Southeast Asia – The fluency of workers in the Philippines and Malaysia in the English language is attracting big contact center clients. Singapore, on the other hand, is fast becoming a destination for IT outsourcing as well as business process outsourcing.  The only concern that clients have is the scalability of operations in these countries; Southeast Asian countries are small and it would be hard pressed to expand operations  and find enough qualified workers.
  • Latin America – Brazil is leading the South American pack in terms of outsourcing. Th  relative proximity of the region to the North American market, which translates to shorter time differences, is the main attraction of these region in terms of establishing offshore operations. Plus, the Spanish speaking people of Costa Rica, Guatemala, and Argentina is perfect for serving the Spanish-speaking customers in North America.
  • Eastern Europe – For many European banks and financial institutions, this region has a lot of potential. Favorable government policies in Poland, the Czech, Hungary and Slovakia are attracting a lot of attention in the outsourcing world, not to mention the language proficiency of the population. Aside from English, it’s easy to find qualified workers who speak French, German, and Spanish.
  • Africa – Surprisingly, some African countries are expected to join the outsourcing rat race in the coming years. South Africa is the leading the region followed by Ghana, Tunisia, and Kenya. The population’s ability to converse in English is the main draw for many clients that include US banks. However, political instability remains a very big disadvantage for the region.

As outsourcing grows, expect the geographical concentration of contact centers and offshore operations to widen. Expect the Caribbean to make it to next year’s list of outsourcing hotspots as governments continue developing the labor force.

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