Why Outsourcing Data Entry for Small Businesses Makes Sense

Traditionally, typical data entry was done by hiring a number of people to manually key in the necessary information into the data system. This used to be the only way. In recent years however, labor has become more expensive and automation has improved. Today, most data entry is done via automated systems that combine scanning hardware, computers, and optical character recognition (OCR) software.

Scanning hardware has been around, in the form of copiers, since the Xerox 914 was introduced in 1959. The first image scanner made to work with a computer was a drum scanner developed in 1957. The cost of the hardware, the quality of images it produces, and the speed at which it can operate has improved dramatically, especially since the 1990s when computers really started to make a big showing in homes and businesses.

Similarly, OCR software has improved tremendously since it was first developed in the 1960s. Today, when tuned properly, and paired with good scanning hardware and computing resources, OCR can do the bulk of data entry by itself.

In small businesses, more often than most large business, there is very little extra income with which to spend on services like data entry. Furthermore, many times the data that small businesses need entered is not a large quantity or is a sporadic task not well suited to a full-time job. Given this, a common decision that small businesses have to make is whether to delegate a current employee to do data entry tasks, hire an intern or part-time employee, or possibly outsource the work.

The advantages of outsourcing data entry to a company that specializes in it are there, even if it’s not as obvious a choice as with larger companies. For a small company with small or sporadic data entry needs, outsourcing can often save money and time. It saves money because the data entry company bills for only the work that they do, they own and operate the equipment and software, and they handle the taxes and benefits for the employees who do the work.

On top of the outright cost savings, using a data entry service will often save time and improve the quality of the resulting files. The reason for this is because it is in the data entry company’s best interest to be as efficient as possible. This means getting the best scanning hardware, computers, and OCR software they can so that they can minimize manual intervention and editing. Furthermore, the people they hire to run the automated data entry systems and do any manual data entry are good at their job, so they minimize errors that cause jobs to be redone.

These advantages combine to make it much more cost-effective for small businesses to hire a company for their data entry services. They can leverage the expertise of that company’s employees, their investment in the hardware and software, and spend their own time focusing on tasks to grow their own business.

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