BPO for E-Commerce in Phoenix: Outsourcing Non-Core Tasks for Improved Online Shopping Experience

The Phoenix e-commerce market is a growing and dynamic industry. It is home to various businesses, from small startups to large multinational corporations. However, such market conditions can make scaling difficult.

That is why many e-commerce businesses have leveraged the power of business process outsourcing (BPO) for their non-core functions. If successfully implemented, this strategy lets your entrepreneurs enjoy many benefits.

If you are curious about how outsourcing can help online retailers improve the buyer journey, this article is for you. It explores the practice’s advantages and tips for choosing the right BPO company in Phoenix.

The Rise of E-Commerce in Phoenix and the World

Society saw a rise in online shopping at the height of the pandemic. The convenience and accessibility of e-commerce contributed to the trade’s continuous growth even as the world slowly returned to pre-pandemic ways. According to Statista, global e-commerce sales surpassed $5.7 trillion in 2022 and are expected to grow more in the following years. 

Phoenix is no stranger to this practice. The city’s access to major markets, dynamic trade programs, and diverse infrastructure make it a favorable location for e-commerce companies. 

Many local businesses of all sizes take advantage of the increasing popularity of online shopping. They offer more diverse product selections and competitive prices to stay ahead of the intense competition.

The Power of Outsourcing Non-Core Functions: Definitions and Benefits

Business process outsourcing is delegating non-core functions to an external service vendor, whether front-office or back-office. But what exactly are non-core tasks, and how do they differ from core activities?

Core business functions are processes essential to your e-commerce company’s success. These tasks include product development, marketing, sales, and order fulfillment.

On the other hand, non-core business functions involve mostly supportive and administrative tasks. Outsourcing these processes is generally more manageable, lowering the risk of losing control. It offers several advantages that cost-efficiently help your e-commerce business scale.

Significant Cost Reductions

Outsourcing is typically less expensive than operating in-house. Many factors contribute to the practice’s economies of scale, including lower living expenses and wage ranges. 

Here are a few ways partnering with a BPO provider helps you reduce costs:

• Eliminated overhead. Outsourcing mainly involves employing remote workers. Such arrangements lessen the need for ample office space, allowing you to save on rent. Thus, you no longer have to worry about utilities such as electricity, water, heating, ventilation, and air conditioning (HVAC) systems.

• Fewer infrastructure costs. Most BPO firms use the latest technologies and e-commerce software. Partnering with a reliable provider lets you access such tools without making expensive purchases or subscriptions. We explore the technologies outsourcing teams leverage in the following sections.

• Lower labor costs. With the fluctuating compensation costs in Phoenix, salaries and wages become expensive, making it challenging to increase the bottom line. Partnering with a BPO provider gives you more power over labor costs. Companies that outsource non-core functions to the Philippines report cutting labor costs by 70%.

• Diminished benefits. Outsourcing providers cover their teams’ benefit packages. They provide health insurance and retirement plans and manage all contributions necessary in their region. Thus, you do not have to manage and pay for the third-party team’s benefits. You can rest assured that workers are fairly compensated.

• Reduced hiring costs. Investing in job postings and fairs can be expensive. Fortunately, outsourcing firms take responsibility for hiring their teams. BPO providers handle the entire process, from creating advertisements to screening candidates and recruiting talent to training new hires, allowing you to save on hiring costs.

Readily Available Workforce

Acquiring qualified talent may take a lot of work in Phoenix. According to the U.S. Bureau of Labor Statistics (BLS), the city has a relatively low unemployment rate of 3.9% as of October 2023. The data indicates a tight local labor market, especially considering the region’s 198,000 job openings.

Fortunately, BPO providers let you tap into their broad global talent pool. These professionals train to master e-commerce best practices and relevant federal and state laws. They are skilled and well-versed in specific non-core functions, such as:

• Information technology (IT) support. Monitoring, maintaining, troubleshooting, and updating e-commerce sites and platforms requires a lot of manpower and time. Outsourcing this non-core function helps ensure your pages are optimized, stable, and secure, allowing you to provide a seamless online shopping experience.
• Human resources (HR) tasks. HR BPO teams can help your business streamline employee payroll processes, benefits administration, and compliance with employment laws. They can also handle performance management, employee relations, and other development programs. Having a dedicated HR team helps boost productivity.
• Accounting and bookkeeping. Financial tasks can be daunting, especially within e-commerce businesses. Relying on third-party accountants and bookkeepers helps you maintain compliance with financial codes. They record transactions, prepare reports, and reconcile accounts.
• Customer support services. A consumer’s online shopping journey can make or break your virtual retail business. E-commerce customer service outsourcing lets you achieve high customer satisfaction ratings despite surging demands. An e-commerce customer support case study by Unity Communications perfectly demonstrates this benefit.
• E-commerce website development. Designing and developing your online shop’s website can be tricky. It must be user-friendly, functional, and optimized for search engines. BPO providers have a talent pool of website developers who perform these tasks to a high standard. They can also create a mobile version of your site.

• Graphic design. You can partner with a BPO provider for creative tasks. Their teams help you create appealing and engaging content for your e-commerce business. Your brand’s graphic design is vital to establishing a powerful identity and presence, so outsourcing this non-core function is a practical strategy for online retailers.

Sophisticated Technology

As mentioned, outsourcing teams use the latest tools and software to support e-commerce businesses. BPO trends and predictions show digital transformation as one of providers’ most popular strategies.

Advanced technologies help them streamline processes, enhance operational efficiency, and deliver exceptional customer experiences. Here are the most popular tools and software utilized by e-commerce BPO teams:

• Artificial intelligence (AI). BPO teams use this technology to automate time-consuming and repetitive tasks. It also personalizes customer experiences and extracts insights from the data. According to a study submitted to the National Bureau of Economic Research (NBER), AI increased productivity by 14% in issues resolved per hour.

• Cloud technology. These platforms allow you to access, store, and exchange software, applications, and data anywhere with an internet connection. E-commerce BPO teams use cloud computing for seamless collaboration, to quickly address customer concerns, and to scale operations at a level that traditional infrastructure cannot match.

• Enterprise resource planning (ERP) systems. Supervising your e-commerce shop’s operations can be challenging. ERP systems help you oversee all aspects of your business, from accounting to inventory to supply chain management. BPO teams use these tools to organize product catalogs, process orders, and track inventory levels.

• Content management systems (CMS). Outsourcing providers utilize this software to organize and create website content. It lets them update product descriptions, add blog posts, and manage website design elements. It also helps maintain content, ensure brand consistency, and optimize e-commerce platforms for search engines.

• Customer relationship management (CRM) systems. This software is indispensable for managing customer data, tracking interactions, and providing personalized support. BPO teams use CRM systems to monitor orders, oversee help desk tickets, analyze customer behavior, and segment customers for targeted marketing campaigns.

Improved Scalability and Service Scope

Access to a readily available workforce and state-of-the-art automation tools allows you to scale operations up or down as needed. Thus, you can accommodate fluctuating customer demands and transactions without worrying about over- and understaffing. 

Additionally, you can power your online shop with outsourced non-core functions, expanding its service scope. Below are the different ways you can enhance e-commerce operations with the help of BPO providers:

• Provide 24/7 services. One of the many advantages of outsourcing to a provider in a different time zone is gaining a round-the-clock team. Whether for support tasks or administrative processes, operating beyond regular business hours gives your shop a competitive advantage. It helps prevent disruptions and increases customer satisfaction.

• Employ multilingual agents. The Phoenix metro area is a diverse region, with Latinos comprising 31% of its population. Outsourcing customer support services to countries such as Mexico gives you a team of English- and Spanish-speaking representatives. Multilingual services reduce the risks of misinterpretations and miscommunications.

• Access global market insights. E-commerce BPO providers often have access to vast amounts of global data, including consumer behavior data, market research reports, and industry trends. You can use this information to identify trade opportunities, assess risks, better understand customers, and develop market- and data-driven business decisions.

Enhanced Focus on Core Functions

With extra manpower and tools to streamline tasks, you can reallocate the resources you saved by outsourcing non-core functions into more central activities. Attending to matters directly impacting your e-commerce business’s growth is the key to maintaining a competitive edge in this fierce industry.

Here are a few advantages you can reap by focusing on core competencies:

• Increased expertise and innovation. By dedicating your time and resources to central activities, you can deepen your knowledge, develop innovative solutions, and stay ahead of the curve in your specialized fields. Such conditions enable you to deliver superior value to your customers.
• Boosted internal efficiency and productivity. Outsourcing non-core functions reduces the burden on internal teams. It allows them to work more on tasks that align with their expertise. This improvement translates into faster turnaround times, better work quality, and enhanced customer satisfaction.
• Strategic alignment and resource optimization. Your e-commerce shop can make strategic decisions that align with its vision and objectives. You can allocate resources more effectively, prioritize initiatives that drive growth, and avoid distractions from non-essential activities.
• Improved customer focus and experience. Internal teams can dedicate more time and attention to customer interactions, providing exceptional service and building stronger relationships. This focus on customer experience enhances brand loyalty and contributes to long-term business success.
• Enhanced adaptability and agility in a dynamic market. The e-commerce landscape is constantly evolving. Your e-commerce business gains the power to focus on strategic adaptation and innovation by outsourcing non-core functions. It will help you remain agile and responsive to market change.

Guaranteed Return on Investment (ROI)

Focusing on core competencies, improving operational efficiency, and significantly saving costs through outsourcing increases profitability. These benefits help you achieve a positive ROI, which means you generate more revenue than you spend on operations.

In Phoenix’s intense e-commerce industry, it may be challenging to scale. However, if your business is performing well, you can enjoy many benefits essential to ensuring sustainability, growth, and a competitive edge. Such advantages include:

• Maintaining stable and continuous financial scalability
• Attracting investors and funding
• Making informed business decisions
• Measuring progress and adapting to market changes
• Maintaining stakeholder confidence

How to Find the Right BPO Provider for Your Phoenix E-commerce Business

The key to ensuring your outsourcing initiative’s success lies with your chosen BPO partner. Short-term or failed endeavors could lead to more costs, detrimental disruptions, and reduced customer satisfaction.

So, how do you find an outsourcing partner that best meets your e-commerce business’s needs? Here are a few vital steps you can take when searching for a provider:

• Assess your outsourcing goals and needs. Determine what you want to achieve by partnering with a BPO provider. Ensure these objectives are specific, measurable, achievable, realistic, and time-bound (SMART). These goals help you identify which non-core functions you should outsource and what technologies you need.

• Research different BPOs and pricing models. Outsourcing follows many methods depending on services, strategies, relationships, etc. Learning about these models gives you the power to conduct a smooth transition for outsourced non-core functions. You should also look up pricing structures to ensure a cost-efficient initiative.

• Compare potential outsourcing providers. Once you have your goals, needs, and preferred models, it is time to search for BPO companies. Read through their websites, marketing materials, and client reviews to better understand their approach and achievements. Compare their experiences, rates, service inclusions, and infrastructure.

• Draft a comprehensive service-level agreement (SLA). Create a contract that specifies your expected service scope, targets, and remedies. Remember to indicate key performance metrics (KPIs) since this SLA will be your basis for tracking the BPO provider’s progress and delivery.

• Request a project proposal or trial period. This extra measure gives you a clearer idea of what it is like to work with your chosen outsourcing provider. It lets you assess their expertise, strategies, solutions, risk management measures, and outsourcing processes firsthand. Trial periods also allow you to identify possible issues early on.

The Bottom Line

In Phoenix’s thriving e-commerce landscape, outsourcing non-core functions emerges as a strategic practice for businesses. It provides better access to expertise and technologies, reduces costs, improves core competency focus, and increases scalability. 

The many benefits of outsourcing allow online retailers to achieve a good ROI and stay agile, competitive, and customer-centric. To maximize these advantages, partnering with the right BPO provider is crucial. 

Let’s connect if you want to power your e-commerce business by outsourcing non-core functions. Unity Communications provides cost-effective, round-the-clock services to help your online shop scale. Having second thoughts? We offer a 60-day pilot period for our new clients!