Rachel Reeves has now delivered her much anticipated Autumn Budget, outlining the government’s plans for the UK economy.

A key element of the budget has been a package of revenue raising measures – with over £40 billion in tax rises. The largest increase from any budget in the past 50 years. The centre piece of these measures has been the increase to employers’ national insurance (NI), which the Office for Budget Responsibility expects to raise £26 billion.

In total employers' national insurance contributions will be increasing by 1.2 percentage points. And crucially, the threshold at which employer's pay NI will fall from £9,100 to £5,000.

This will raise the overall cost of employment to employers throughout the UK.

What are you options?

The increase in employers’ national insurance contribution has thrown a spotlight on to one of the benefits of outsourced business functions.

As one option to reduce your exposure to the national insurance increases is to consider outsourcing your business functions - such as marketing.

By outsourcing your business functions, you can help to reduce your exposure to increased employer’s national insurance contributions by reducing your business headcount. This gives you greater control over your costs.

So, in the case of marketing, rather than having the fixed costs of an in-house marketing employee or team – with an outsourced function you will be able to scale your marketing resources flexibly as your business needs change.

Won’t outsourced agencies simply pass on the cost?

An argument against this is that outsourced agencies will simply pass on the increase in national insurance contributions from their own employees to you in fee increases.

This is true for big agencies. However, given the increase in employment allowance, the government has set out it's stall in shielding smaller businesses from NI increases. This means smaller agencies and freelancers will not see an increase (or a smaller increase) in national insurance contributions – and therefore have reduced additional costs to pass on.

Even in the case of big agencies, they will be the one taking on the risk of additional employment costs, rather than your business.

Other benefits to outsourced marketing

At the RMC we are specialist in outsourced marketing, and so alongside the cost implication we believe there are also plenty of other benefits to an outsourced marketing function.

These other benefits to outsourcing your marketing include:

Flexibility and scalability

With an outsourced marketing function you only pay for the services you need. In a business environment where speed and responsiveness to changes has become increasingly important – using an outsourced function can help to keep your business agile.

And, as your business grows, your marketing function can scale quickly alongside. No need to go through long recruitment processes or be lumbered with long-term employee expenses.

Specialist expertise

Marketing has become an increasingly specialised industry. With marketing success increasingly built on having a mix of creative and analytical skills.

Instead of trying to find these skills in single individuals (or even one agency) it has become important to instead use a network of specialists.

Have a writer, editor, SEO expert, graphic designer, and web designer all working on one project.

Or, in other words, use the right tool, for the job.

A Fresh perspective

Sometimes it can be difficult to see the wood-from-the-trees. An outside expert can help to bring a fresh and unbiased perspective to a problem and bring their expertise from working across multiple projects.

RMC provides long-term outsourced marketing services to B2B companies, including professional services, manufacturing and medical device firms. If you would like to find out more and how we could help your business, please get in touch. We would love to hear from you.

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