Businesses are outsourcing a host of internal processes to capitalize on competitive advantages.
In many instances, outsourcing simply makes good business sense. The cost of outsourcing can reduce costs in other areas. But, if you are considering outsourcing, the decision should be more than a matter of money.
Outsourcing could expose your business to business risks. Fortunately, you can reduce these risks by purchasing various business insurance products.
Reduce Financial Responsibility with Commercial Liability Insurance
Outsourcing is a great way to streamline your business operations. But, you are still responsible for the services the performing company provides your customers. If the performing company is negligent, your customers may try to sue you.
To protect your business, you need liability insurance. With commercial liability insurance, you can insulate your business financially from negligence.
Depending on the services the performing organization provides, you may need to require the organization to buy a surety bond. There are various types of surety bonds, including a performance bond. A performance bond will decrease your financial losses if the performing organization doesn’t perform the work outlined in the contract.
Protect Your Business from Product Liability
Businesses don’t only outsource services. Some businesses outsource the manufacturing of their products too. Perhaps you outsource your products overseas to maximize your profit margins. If you do, you must safeguard your business against any defects built into your products.
Many overseas manufacturers don’t comply with the United States' strict manufacturing guidelines. They may operate using the same quality control standards as those in the United States. As such, it’s imperative that you have product liability insurance. This can help you avoid economic disruptions to your business if you have to face a lawsuit.
Always Protect Your Reputation
You can protect your business from financial losses using insurance. However, your insurance won’t help you protect your brand’s image. If your business is considering outsourcing any aspect of your operations, it’s best to be discriminating when it comes to choosing partners. Look for a company that can deliver both quality and cost-savings. Then purchase business insurance to shore up your business from uncertainties you can’t control.
Buschbach Insurance Agency can help you choose the business insurance plan you need. Explore our online options to learn more about the choices you have. Call us today at (708) 423-2350 for more information.