An outsourcing company is a third-party organization that provides services or performs tasks for another company on a contract or ongoing basis. Outsourcing is a business practice that companies use to cut labor costs, including salaries for their personnel, overhead, equipment, and technology. Companies can outsource entire divisions, such as their entire IT department, or just parts of a particular department. Outsourcing can involve using a large third-party provider, such as a company like IBM to manage IT services or FedEx Supply Chain for third-party logistics services. But it can also involve hiring individual independent contractors, temporary office workers, and freelancers.

Outsourcing companies provide a range of specialized services to other companies. They document client requirements, outline the work process, estimate the completion time frame and costs involved, and complete and deliver the work. The services offered by outsourcing companies can range from business process outsourcing and information technology outsourcing to customer relations management, human resources management, and finance and accounts management. Other outsourced areas include health and pharmaceutical business process outsourcing, and animation and creative industry outsourcing.

Companies today can outsource a number of tasks or services. They often outsource information technology services, including programming and application development, as well as technical support. They frequently outsource customer service and call service functions. They can outsource other types of work as well, including manufacturing processes, human resources tasks, and financial functions such as bookkeeping and payroll processing.

Outsourcing can be done onshore (within the same country), nearshore (to a neighboring country or one in the same time zone), or offshore (to a more distant country) . Nearshore and offshore outsourcing have traditionally been pursued to save costs.

In summary, an outsourcing company is a third-party organization that provides services or performs tasks for another company on a contract or ongoing basis. Companies use outsourcing to cut labor costs and focus on their core business operations. Outsourcing companies provide a range of specialized services, including business process outsourcing, information technology outsourcing, customer relations management, human resources management, and finance and accounts management. Outsourcing can be done onshore, nearshore, or offshore.