Outsourcing Business

How Much Does It Cost To Start An Outsourcing Business? (In 2024)

Pat Walls

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Updated: October 6th, 2024

Looking to start an outsourcing business?

But curious about:

how much it costs to start an outsourcing business?
what are the typical outsourcing business startup costs?
or the actual cost of starting outsourcing businesses?

Well, we have the data to prove it, supported by real outsourcing businesses and how much they actually cost to start.

Let's go over it.

What is the average cost of starting an outsourcing business?

Based on our data reported by actual outsourcing business founders, the average cost of starting an outsourcing business is between $250 and $500,000.

Additionally, our data shows that the the median startup costs for an outsourcing business are around $19K.

Remember, though, not all outsourcing businesses are the same - and neither are people's budgets. It's important to distinguish between different levels or types of outsourcing businesses

Real World Examples: How much does it cost to start an outsourcing business?

We asked real outsourcing business founders and business owners how much it actually cost to get started?

Here is what they said:

Heather Lawson-Bradfield

Founder of The Clover Collective ($50K/month)

"I bootstrapped, painfully bootstrapped. I took in small accounts - $500/mo, $1k/mo retainers. My initial goal was to hit 3k a month in revenue."

Heather Lawson-Bradfield is the founder of The Clover Collective, a virtual operations management agency for creatives, that supports neurodivergent entrepreneurs and members of marginalized communities.

Read this case study

Read by 1,246 founders

Pavel Stepanov

Founder of Virtudesk ($500K/month)

"The process of designing, prototyping, and manufacturing our service was not difficult or time-consuming. All it took was 2-3 days and $2,000 to start serving our first clients."

Pavel Stepanov is the founder of Virtudesk, a virtual assistant services business that helps entrepreneurs scale and automate their businesses.

Read this case study

Read by 7,977 founders

Linh Podetti

Founder of Outsourcing Angel ($120K/month)

"The MVP took just 2 weeks to build and cost only $400. I registered the domain and it cost $12.99. It really didn't cost much."

Linh Podetti is the founder of Outsourcing Angel, a virtual assistant agency that has grown into a 7-figure business.

Read this case study

Read by 4,525 founders

Jaime Nacach

Founder of Virtual Latinos ($350K/month)

"The company’s domain, VirtualLatinos.com, was purchased in January 2018, which we count as the company’s anniversary. The first landing page to attract VA was launched on Feb 24, 2018, and the client’s landing page soon after April 27. The first 50-100 VA applicants completed their application within a few weeks, and by May 3, 2018, we had hired the first VAs from Virtual Latinos!"

Jaime Nacach is the founder of Virtual Latinos, a virtual assistant platform that connects North American companies with pre-vetted talent from Latin America.

Read this case study

Read by 5,993 founders

Enjoyed reading these real world examples?

Our platform is full of case studies of successful outsourcing businesses that you can learn from.

Starting an outsourcing business - what you should know:

Launching an outsourcing business involves navigating various cost factors that can significantly influence your initial and ongoing expenses.

Infrastructure and Technology

Investing in the right infrastructure and technology is crucial. Initial setup costs for essential devices such as computers and printers can range from $500 to $2,000 per employee. Additionally, purchasing or subscribing to reliable software solutions for project management and communication can cost between $100 and $300 per month per user. Choosing cloud-based solutions might seem more expensive initially, but they often offer scalable options that can reduce costs as your business grows.

Staffing and Salaries

Outsourcing businesses rely heavily on human resources, making staffing a critical cost consideration. Depending on the role and region, salaries can vary significantly. For example, hiring a virtual assistant might cost you $10 to $30 per hour, whereas specialized roles, such as IT support or customer service representatives, could range from $20 to $50 per hour. Hiring freelancers or part-time workers initially can help manage these costs efficiently.

Marketing and Client Acquisition

Marketing your outsourcing business is essential to attract clients. Digital marketing, including SEO, social media advertising, and content marketing, can collectively cost around $1,000 to $5,000 per month. If you opt for more aggressive strategies like pay-per-click (PPC) advertising, it could push your budget upwards to $10,000 monthly. Establishing a strong online presence with a professional website could involve a one-time cost of $1,000 to $5,000 depending on design complexity and features.

Operational Costs

Monthly operational costs such as utilities, internet, and office space (if not operating remotely) are additional factors. Renting a small office could range from $500 to $2,000 per month depending on location, while utilities and internet services may add another $200 to $500. For those operating remotely, co-working spaces offer a flexible alternative, costing about $100 to $500 per month per user.

Legal and Compliance

Legal and compliance costs should not be overlooked. Registering your business and obtaining necessary permits could cost between $300 to $1,000. Ongoing legal advice and tax services might add another $100 to $300 monthly. Ensuring you're compliant with local labor laws and international regulations is essential to avoid costly penalties.

Understanding these cost factors and planning accordingly can enhance your chances of success and sustainability in the competitive outsourcing industry.

Potential Costs of Starting an Outsourcing Business

Starting an outsourcing business involves a variety of upfront and ongoing costs, including infrastructure, labor, software, and other operational expenses. Here is a detailed breakdown of the potential costs you might incur:

Cost Category	Description	Estimated Cost
Business Registration	Legal fees for registering your business and obtaining licenses.	$300 - $1,500
Website Development	Design, development, and maintenance of a professional business website.	$1,000 - $5,000
Web Hosting Fees	Monthly or annual fees to host your business website.	$10 - $100/month
Domain Name	Annual cost to register a domain name for your business website.	$10 - $50/year
Office Space	Rental costs for office space depending on location and size.	$500 - $5,000/month
Utilities	Electricity, water, internet, and other utility costs.	$200 - $800/month
Hardware	Desktops, laptops, servers, and other IT equipment.	$500 - $2,000/unit
Software Licenses	Costs for essential software such as project management tools, CRM, and accounting software.	$20 - $200/month per software
Employee Salaries	Monthly salaries for employees; representing the biggest cost component.	$3,000 - $10,000/month per employee
Freelancer/Contractors	Fees paid to freelancers or contract workers for specialized tasks or projects.	$15 - $60/hour
Marketing & Advertising	Budget for digital marketing, SEO, PPC campaigns, and other promotional activities.	$500 - $5,000/month
Insurance	Business insurance including liability, property, and health insurance for employees.	$500 - $2,000/year
Training & Development	Costs related to training programs, workshops, and courses for employee skill enhancement.	$200 - $1,000/session
Legal & Professional Fees	Ongoing legal counsel, accounting services, and other professional fees.	$1,000 - $5,000/year
Miscellaneous Supplies	Office supplies, furniture, and other miscellaneous items.	$100 - $1,000/month