Outsourcing, no doubt, has become the global trend. May it be software or other business processes. Profiteering apart, there are very few factors governing outsourcing. To take the competitive edge over rivals, multinationals go for outsourcing applications and to third world countries. India is taking a lead in outsourcing these products. India has remained a consistent and reliable outsourcing partner since years for many top notch software colossus.
Outsourcing India
These days about half of the Fortune 500 companies turn to Indian IT sectors to design, develop, modify and maintain their IT systems. India, the leading outsourcing partner for large number of multinationals has established goodwill in outsourcing business. Amongst a varied outsourcing projects software development genre has become notable. Microsoft, Dell, Oracle etc. have been outsourcing to India. Their corresponding Indian outsourcing partners are Infosys, Wipro, TCS etc. And they are delivering a satisfactory service towards the software needs of these vast multinationals. It is not only an option, but a profitable one considering the cost involved in the domestic product development. The sole reason behind outsourcing is the lower cost structure involved as regards manpower and infrastructure.
Small is also not far from the scenario. Today many of the small business organizations are taking advantage of their software development outsourcing. Most particularly to gain the competitive advantage in a reduced cost, small business are taking into the outsourcing options to maximize their profit margins.
Next advantage of outsourcing is the accessibility to global experts. It is one of the best options for small business organization to have access to global talent in cost effective manner which can not be attained onshore with the same amount of investment.
May it be software outsourcing or business process outsourcing or knowledge process outsourcing, all these outsourcing, which could otherwise be done onshore, is done for the cost effectiveness point of view. Presently many of the IT firms are more concentrating into the software development than the other outsourcing varieties.
Indian IT firms are still dipped into outsourcing, but with the increasing rupee appreciation in India, an apprehension of ruination the future of IT outsourcing prevails over there. Till now IT outsourcing is doing a good business. How long it continues is the matter of concern.
Software Products And Services
* Seed your existing market with a new product without an expensive sales program.
* Create a new market for an existing product in combination with a new product.
* Clear inventory of current versions in preparation for new versions of products.
* Extend the life of one or more products.
While this has been a staple of marketing in the software business for years, it can also work for other types of products and services.
To be fair, bundling already works well in other businesses too: hair care products are often sold in bundles of shampoo and conditioner; books and music CDs are sold in sets; dishes are offered with accompanying accessories.
What Is A Bundle?
What makes a bundle, well, a bundle? Generally, a bundle consists of two or more products that either share some characteristics or that can be used to solve different problems for the same target customer. I've already mentioned some of the more obvious examples, but let's consider some not so obvious examples.
Organizers
If you sell your services as a clutter coach or a professional organizer, you might consider bundling a few products with your services:
* Filing cabinets
* Shelving units
* Desk accessories
* Waste baskets
* Office supplies
* Cleaning supplies
Of course, these are products that would be easy enough for the client to obtain on their own, but why not add these to your offering? You can deliver the products to your clients when you come to perform your consulting duties, saving your client a trip or even saving them from ordering the wrong supplies or too many, not enough, and so on.
You may even be able to forge a deal with an office supply company to provide you the products at a slight discount. Or look for suppliers who might be willing to private label supplies using your logo and company name.
The Common Computer Hardware Example
When you sell computer equipment and installation to a small company, why don't you bundle in a service package that provides monthly cleaning, backup, and troubleshooting service. Bundle in training. Offer a supply of blank DVDs or online storage for backup. How about cleaning supplies, and laser printer paper?
You know that your customers will be using these products, so why not provide them as a convenience. Save your customers the trouble of ordering the items from another vendor.
One of the problems I can already hear you bringing up is, "But we already offer a service contract and we can't get people to take it."
Of course not! We all hate being nickled and dimed, which is why extended warranties and service contracts have such a bad reputation. If you built enough profit into your products and services, you could simply provide the service contract as part of the deal, and even call it a FREE bonus. Spread the cost out across your entire product line and it won't raise your prices much. And you'll make up the added expense through regular upsale opportunities.
Software Examples
A friend of mine once wrote and sold a software program that helped companies monitor and identify performance bottlenecks in their database applications. Once a customer knew where the problem was, he could write a script to fix the problem. My friend wrote twenty-five scripts that would fix the most common performance problems in the most popular databases. As an incentive, he would provide those scripts to anybody who purchased his product within a certain time limit.
Issues to Keep in Mind
If you decide to bundle two or more products, keep the following issues in mind:
* If you discount your bundle relative to the cost of the individual components, make sure that you don't discount so much that you actually lose money on one or more components.
* If you charge more for the bundle than the customer would pay for the component parts, add value by including a booklet or some type of service.
* Make sure your follow-up procedures are in place. If you offer ongoing service, you must be prepared to provide that service consistently. If you offer products that need to be replenished, make terms of the arrangement clear to the customer: if you will charge for the replenished products, obtain approval up front.
* Keep packaging simple unless you intend to create a long term product that will need its own packaging. Often, software product bundles have their own special packaging, the Leaky Faucet First-Aid Kit probable won't.
Both Smita & Mark Smallwood are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Smita has sinced written about articles on various topics from About Web Hosting, Computers and The Internet and Elearning. Smita, is the author of . She is an expert writer and has been working with the company since years. She writes on various topics on Inf. Smita's top article generates over 165000 views. to your Favourites.
Mark Smallwood has sinced written about articles on various topics from Information Technology. You can read other articles by Mark Smallwood at http://www.eversmall.com where he deals with small business, freelancer, consultant, and work at home issues. Contact Mark at marks@eversmall.com.. Mark Smallwood's top article generates over 590 views. to your Favourites.
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