How to start an outsourcing company (2016)

I wrote an earlier version of how to start an outsourcing company several years ago. I wanted to spruce it up a bit, so here is the new version.

1. Have Extensive Experience
I get emails daily from people who want to start a BPO, or who just got one but lack clients. There is a lot of competition out there and a lot that can go wrong. You need many years of experience in your industry to have a chance at doing well. Additionally, you need to be better at what you do than anyone else, otherwise, why should anyone hire you? I’ve read many articles about entrepreneurships and startups. The point that hit home is that people in their 20’s that want to start businesses have a high failure rate because they lack maturity and experience. A startup might be a new business, but the experience that goes behind it should be old. People tend to do a lot better at entrepreneurship in their 50’s as they are well seasoned, mature, have contacts, and have a ton of experience. I’m not discouraging young people from starting businesses. I started my first business when I was six, and another when I was fourteen. I did okay too and I learned a lot from it. However, I was very immature how I ran many aspects of my business. My businesses had small investments like a lawnmower and a rake. If you are investing in a 20 seat office and salaries, you had better know what you are doing.

2. Get Management Experience
Okay, so you know how to do your job and you worked for the best. There is a lot more to running a business than being a worker. Being a good worker is only one aspect to the endeavor. If you were a good worker, that shows you have the skills and patience to survive in the industry. But, you need to know how to manage expenses, do marketing, hire, fire, train, and assess workers. That requires many years in management to be any good. I recommend that you have at least seven years in management before attempting to create your own BPO.

3. Master your Marketing
As a BPO owner, you won’t survive at all if you don’t have clients. You need to be an expert at marketing. You need to be able to find decision makers at companies around the world to get clients. Some use LinkedIn, others go to networking meetings, while many have agents to help them find clients. You can also subcontract work from other people’s outsourcing operations. Having a great website and promoting it is often the solution while excelling at social media and blogging is a great boone to your business presence.

4. Excel at Customer Retention
If you start an outsourcing company, you will have customers. The difference between a good outsourcing company and a great one is how long you keep your clients. Do you do a good job? Do you keep in touch with clients? Do you help them find new reps quickly if they don’t like the old ones? Are you there for your clients, or do you just use them for money? To do well at outsourcing you need to focus on pleasing clients no matter what. You can’t grow your company if you are always losing your clients.

5. Give Free Samples
I grew my businesses by offering free samples or discounted trials. If you want to attract outsourcing clients, give them a chance to try your work with no contracts and low prices. They will be seven times as likely to give you a chance if you give them something for free or half price. If you do a good job, you might win them over for life. So you get by giving.

6. Offer Liberal Terms
Most outsourcing companies want people to sign rigid contracts that enslave them to stringent terms. Personally, I don’t want to sign a contract with a stranger. The contract ensures that I will pay a certain quantity of dollars each month. However, the contracts never ensure the quality of the service that I am getting. If I get poor service, can I pay with low quality dollars? Dollars are dollars, but no two services are the same. My suggestion is to have easy contracts in the beginning going week to week or month to month with very small deposits. Let the client get comfortable with you before you get demanding.

7. Have Clearly Defined Specialties
There is nothing worse than a call center that is not clear about what they do. Some do telemarketing, others do chat support, while a few do appointment setting. You never really know how good they are at any of their specialties. It is easier when there is a list of specialties in the “services” page of their website. That way you can be sure they do chat support — unless they stopped doing it three years ago and removed it from their site. If you claim to specialize in something, make sure you have multiple workers trained in it so a client can always get someone.

8. Flexible Office Space
Some call centers start with a huge office and then try to get clients. Many of them end up with huge losses from miscalculating how much space they need. It is better to have a flexible system for getting office space. Start small, and don’t get a big office until you have stable clients who are not going to end their relationships with you on a whim. If your workers are divided between two buildings, that is not the best, but it is temporary and you will have to deal with that as your company grows. Some offices offer shared spaces where you can rent space by the day, week, or month. Those would be excellent resources for a startup that doesn’t know how much space it will need.

9. Offer Training To Your Workers
Most BPO companies do not invest enough in training their workers. If you care about success, be like some of the top rate call centers and monitor your workers daily. Train them constantly. Make sure your workers are the best. I am tired of calling outsourcing companies only to hear them say, “hullo” when they answer. This is very unprofessional. If that is how the managers answer the phone, their workers are almost guaranteed to be horrible. If you aren’t professional yourself, how can you possibly train your workers to be?

10. Have Marketing Managers & Floor Managers
To grow your company, you can’t be two places at the same time. You need someone to manage the workers as well as someone to handle marketing and sales. If you hire people who aren’t loyal to you, you might be left high and dry. So, you might have primary managers and a few backups who you are constantly training.

11. Reward Worker Loyalty
You can’t build a good business with disloyal employees. Businesses that do well have a core of people who have been with them for ten or twenty years. You need to make sure you treat your star employees like stars. They deserve more money, better conditions, and appreciation. If you take them for granted you’ll lose them. Mediocre workers are dime a dozen — they are replaceable. But, you can’t build a business with them. Stars are the framework of your future success. Find them and find a way to keep loyal and talented people, otherwise your business will be tiny forever — or worse — it might be a collection of 50 dysfunctional nitwits!

Summary
I wish you good luck in business. But, the worst thing you can do in business is to go too fast. Get your foundation in order before creating a business. If you are not already a marketing genius, you’ll never survive. If you have to ask me how to get clients, you’re in the wrong field altogether. Additionally, I would like to add that the call center business is one that many Indians want to start. This type of business is almost exclusively being done outside of India. Even Indian companies are hiring Filipinos to do their call center work since the manners in India are very unpolished. Try to focus on an outsourcing specialty that caters to the talents of the workforce where you are. Indians are better at accounting and technical support than call center work. Keep that fact in mind as it can make you or ruin you! Good luck!

You might also like:

Six problems that only someone working in a BPO company would understand
http://bpo.123outsource.net/2015/06/15/six-problems-that-only-individuals-working-in-a-bpo-industry-would-understand/

Marketing your BPO firm from A to Z
http://bpo.123outsource.net/2016/05/22/marketing-your-bpo-outsourcing-firm-from-a-to-z/

If you invested in training your BPO workers, what types of skills would you teach them?
http://bpo.123outsource.net/2015/03/28/if-you-invested-in-training-your-bpo-employees-what-types-of-skills-would-you-teach-them/

See our 2011 version of how to start an outsourcing company!
http://bpo.123outsource.net/2011/04/24/how-to-start-an-outsourcing-company/