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How Outsourcing Can Help SMEs Compete With Larger Companies

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SMEs can benefit from partnering with a business process outsourcing (BPO) firm to stay ahead of the competition in the long run.

Small and medium-sized enterprises (SMEs) have consistently faced significant challenges when competing with their larger corporate counterparts. Industry giants typically have brand recognition, greater financial resources, expertise, workforce, and market share, making it difficult for small and medium companies to secure a steady foothold in the market, especially when operating in this modern digital world. But there is good news. SMEs can leverage partnering with a business process outsourcing (BPO) firm to help them stay ahead in the long run and compete with industry giants. 

Of course, outsourcing also comes with a problem. It is not a one-size-fits-all solution. Small and medium organisations must carefully assess their offshoring needs and seek the right BPO service provider to meet their unique requirements. Additionally, they should initiate clear communication channels and performance metrics to ensure the outsourcing activities align with their overall company goals. With the right strategic partnerships and approach, outsourcing makes it possible for small and medium businesses to drive operational efficiency, innovation, and growth, ultimately contributing to the long-term success of their business. 

Fortunately, an excellent offshoring marketplace like The Lead Enquiry can be a bridge to connect SME company owners and even start-ups to our reliable, first-rate, and trusted BPO provider partners around the globe. 

In this blog post, we will primarily discuss the top reasons why outsourcing can help SMEs compete with larger companies. But before that, we will also tackle necessary details about SMEs and industry giants.

Keep on reading!

All About Small and Medium Enterprises (SMEs)

Small and Medium Enterprises (SMEs) are businesses that have a limited workforce and revenue compared to large corporations. However, these types of companies play an essential role in the economy as they contribute significantly to employment rates, innovation, and competition. SMEs are classified based on their workforce size, annual turnover, or balance sheet total. 

SMEs constitute a significant portion of the business landscape in many countries worldwide. They typically employ fewer than 250 people and generate lower annual revenue when compared to larger organisations. However, despite their size limitations, SMEs often operate within niche sectors where they can effectively compete by providing unique products or services. Many governments recognise the importance of supporting SMEs by offering incentives such as tax breaks and loans to help them grow.

Defining Larger Companies

Larger companies, or what we call “industry giants”, are corporations that have grown to a significant size in terms of revenue, market share, and number of employees. These organisations generally have more resources at their disposal than smaller businesses, which allows them to pursue growth and expansion opportunities. In addition, their size often grants them access to economies of scale that can lower production costs and help maintain competitive pricing. 

Moreover, larger companies tend to have diverse portfolios of products or services that cater to different markets. This diversification strategy enables them to spread risk and reduce dependence on a single product or market segment. Additionally, these firms enjoy a more robust brand reputation than smaller competitors due to their larger marketing budgets and longer operating histories.

Overall, the benefits of being a larger company include increased financial stability through multiple revenue streams, greater bargaining power with suppliers and customers alike, and more opportunities for innovation due to increased R&D investment capabilities.

What is the difference between SMEs and Industry Giants?

Small and medium-sized enterprises (SMEs) are often in comparison to industry giants in terms of their market position, business operations and financial stability. However, while both SMEs and industry giants share the same goal of achieving long-term success, there are some fundamental differences between these two types of businesses. 

Firstly, size is a major factor that sets SMEs apart from larger corporations. SMEs typically have fewer than 250 employees and generate less revenue than industry giants. This means that SMEs have less bargaining power when it comes to negotiating contracts with suppliers or accessing capital from banks.

Secondly, SMEs’ decision-making process differs from that of large corporations. In an SME, the owner or manager has complete control over all aspects of the business, including hiring staff, setting prices and developing marketing strategies.

Finally, SMEs are independent businesses that generate lower revenue than industry giants. SMEs are the backbone of many economies, as they create job opportunities, foster innovation, and contribute to economic growth. They often operate in niche markets and offer specialised products or services that cater to a specific customer base. On the other hand, industry giants are multinational conglomerates that dominate their respective markets. These companies have significant market share, extensive resources, and established brand recognition. They typically have diverse product lines that appeal to a broad range of customers worldwide. They also often engage in mergers and acquisitions to expand their portfolio of products or services and maintain their dominant position within the market.

Top Reasons Why Outsourcing Can Help SMEs Compete with Larger Companies

Cost Savings

Outsourcing to a BPO provider can help SMEs and start-ups save on costs associated with hiring, training and managing staff and setting up the necessary infrastructure for particular processes or tasks such as technical support or content moderation. In addition, by delegating non-core activities such as customer service, data entry or web development to a third party, SMEs can save money on operational costs and have more funds available for strategic investments and other areas that will help them succeed.

Time Savings

SMEs can outsource mundane tasks and professional services such as accounting, bookkeeping or payroll processing to focus their time on strategic activities that will help them stay competitive and profitable over the long term.

Begin New Projects Quickly

A good external firm has the resources to begin a project right away. However, managing the same project in-house for SMEs might take weeks or months to employ the right people, train them, and render the support they need. And if a project requires significant capital investments (such as establishing a series of distribution centres), the start-up process can be even more challenging. 

Improved Efficiency With Advanced Tools and Technology

Many outsourced services use cutting-edge technology platforms, making it easier for SMEs to manage their operations and access real-time data. This results in improved efficiency, better decision making and a faster response time to customer needs.

Concentrate on Core Competencies

Seeking the help of BPO outsourcing companies allows small and medium corporations to focus on their core competencies and allocate resources more efficiently. By delegating non-core business functions such as accounting, IT, or customer service, small businesses can free up time, money, and other resources to focus on their core strengths. This enables them to flourish their services and products, enhance customer experience, and differentiate themselves from larger competitors.

Obtain Access to Specialised Expertise and Resources

Working with a BPO vendor can provide small and medium businesses access to specialised expertise and resources they may need in-house. For instance, a small and medium corporation may need more money or expertise to develop a sophisticated marketing campaign or build a robust IT infrastructure. However, by offshoring these functions to a specialised BPO provider, they can tap into their expertise and resources and attain similar results as industry giants.

Flexible and Adaptable Solutions

Outsourcing allows SMEs to stay flexible and adaptable in a rapidly changing market. After all, given today’s fast-paced business environment, small and medium businesses need to be responsive and agile to new opportunities and challenges. Likewise, outsourcing enables SMEs to quickly scale up or down their operations as required instead of committing to a long-term in-house resource contract. 

Risk Management

Every business investment, including SMEs and start-ups, carries a certain amount of risk. Competition, government regulations, markets, financial conditions, and technologies all change very quickly. Outsourcing providers assume and handle this risk for you. In addition, they are generally adept at deciding how to mitigate risk in their areas of expertise or any issues that arise during development. As a result, you will have a peace of mind. 

Level the Playing Field

Most small and medium firms simply can’t afford to match the in-house support services that industry giants maintain. Outsourcing can help small and medium businesses act “big” by offering them access to the same efficiency, expertise, and economies of scale that larger companies enjoy.

How SMEs Can Successfully Outsource

SMEs need to consider the pitfalls of outsourcing before making any decisions. Here are some tips for successful outsourcing.

Choose carefully

Make sure that you understand precisely what services your outsourced provider will render and how they will fit into your operations. In addition, check references from other companies who have used the same provider in order to ensure that they are reliable.

Set clear goals

When outsourcing, you and your outsourced partner must set clear goals and expectations so that everyone knows what you expect from them. Ensure that these goals are measurable so it will be easy to track progress towards them over time.

Monitor performance

It is essential to monitor the performance of an outsourced partner regularly to detect any problems early and take corrective action as needed.

Stay in contact

Make sure to stay in regular contact with your outsourced partner so that you can discuss any issues or changes to services quickly and easily. This will help ensure the project remains on track and meets its goals.

Have a backup plan

If things don’t go according to plan, SMEs need a contingency plan to prepare their business for any abrupt or unexpected events.

SMEs can ensure they get the most out of outsourcing by taking the time to research, setting clear goals and expectations, monitoring performance regularly and staying in contact with their outsourced partner. In addition, by having a backup plan in place, businesses can be better prepared for any unforeseen circumstances or issues that may arise during the project.


To maximize their potential for growth, small and medium-sized businesses should seriously consider the advantages of outsourcing.

To wrap it up, it is clear that outsourcing can be an effective strategy for small and medium businesses looking to level the playing field and compete with industry giants. This is because it can provide a range of beneficial services to small and medium enterprises. With the right strategies and tools, outsourcing can lead to improved efficiency, reduced costs, better customer service and access to specialised skills, which means, SMEs can expand into new markets and take on more significant projects. Therefore, small and medium firms should really consider the benefits that outsourcing can bring to maximise their potential for growth.

Tap into the power of outsourcing by making it your secret weapon. Your SME doesn’t have to be held back by limited resources. The Lead Enquiry can help you connect with our long list of well-vetted BPO service provider partners with expertise and skills like no other! Contact us today.



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