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Ruralsourcing: A Win-Win Idea for Small Businesses

Ruralsourcing: A Win-Win Idea for Small BusinessesFor years we’ve been hearing about offshoring and outsourcing—indeed, the practice of hiring work out to people in India and Asia has changed the way of life for many U.S. small businesses (and not always for the better).

Now, a new trend—and one that’s more positive for the millions of unemployed U.S. workers—is taking hold: ruralsourcing.

Also called “rural outsourcing” and “onshoring,” CNNMoney.com reports [1], ruralsourcing outsources work to small, rural towns where the cost of living is low, but many people are out of work. By hiring workers in these areas, companies pay between 25 and 50 percent less than they would if hiring workers in an urban area.

Onshore Technology Services is a rural outsourcing company with locations in Macon, Lebanon and Joplin, Missouri. It recruits workers out of minimum-wage jobs and trains them to handle IT jobs. In Burnsville, Minnesota, CrossUSA recruits older IT workers who are closing in on retirement.  The company is growing by 7 percent annually. Atlanta-based Rural Sourcing Inc. [2] takes a slightly different tack: It opens locations in midsized cities near colleges, which have a good population of IT workers but still have lower living costs than big cities. The company has clients ranging from small businesses to Fortune 500 firms.

While CNNMoney says ruralsourcing is still small compared with the $60 billion offshoring industry, it’s growing as U.S. businesses seek solutions that let them cut costs without the tradeoffs that offshoring involved.

If you’ve ever outsourced to foreign companies, you know the cost savings can quickly be eaten up by inefficiencies due to different time zones, cultural issues and communication problems. This can make the slightly higher cost of ruralsourcing well worthwhile.

One Rural Sourcing client cited in the article says while they pay 15 percent more than they would to an Indian IT firm, the cost is still half of what they would pay to hire a fulltime developer in their metro area. Plus, when there’s a problem, they can call the worker on the phone and talk about it.

If you, like many American business owners, are dismayed by the flow of jobs offshore but torn because you need to spend less on hiring, ruralsourcing could be a great solution.