Outsourcing - Making your bottom line lean and mean?

[hlctemecula]

I've been talking to my business partner about our expenses and how to trim them down to allow more flow-through profits to reach us and build our business. It turns out, more than 50% of our expenses are currently spent on our sales force.

I've been thinking of ways to decrease that expense and it just doesn't seem possible with employees in the U.S. We're right in there as far as what we pay our employees and drastically reducing their income makes us less competitive and would hurt our retention on our sales force.

Over the last few weeks we've been taking a hard look at both the Phillipines and India for a serious move. Due to average incomes being significantly lower, we can pay our sales force there slightly above average wages with commission opportunity that could possibly give them great wealth, while reducing the cost of our sales force by more than or close to 500%!! Even with a few language barriers and difficulties with culture, I think it would be hard to see that drastic of a reduction in a salesperson's numbers there as opposed to here...not to mention there's this HUGE pool of people looking for employment and they work their butts off for you to keep their jobs.

A move to either of these two countries would still be a considerable initial investment...not to mention a drastic life change for my business partner and I to relocate. I really do think it's a forward thinking, outside-the-box idea...especially for our industry. I think we'd really be leading the way with this and the profit margin would increase dramatically.

I'm currently in the process of hiring 1-3 outsourced advertisers for online advertising, recruiting efforts, etc. I'll be interested to see how it goes and I'm hoping I can make some contacts that will get the ball rolling.

Have any of you that have medium sized companies considered this? Anyone actually given it a shot and/or taken the plunge? I'd be interested to hear your ideas/stories/pitfalls.

[tekmoney]

Is it mathematically possible to reduce your costs by 500%?

[chiefpenguin]

I'm from the Philippines. Yes, there are many foreign countries that take their business here. Call centers have become fairly common. What is your business?

[The Stealthy One]

tekmoney, no that is not possible!

[hlctemecula]

Is it mathematically possible to reduce your costs by 500%?

Lol, that's what I get for flying through my post...you're absolutely correct, of course.

To be more clear, I believe I could lower the money paid to the sales force from approximately 360K to around 70-80K which would equate to a huge savings, putting alot more money in my pocket and allowing our business to profit and grow considerably.

Our sales are currently all over the phone and so I think the transition would be relatively smooth. You could be sitting on the beach in Brazil in today's world and continue to work for us...assuming you had the motivation to work from such a place, of course.

Our business is a small real estate company, btw.