# Outsourcing Savings Calculator

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## What is Outsourcing Savings Calculator?

An Outsourcing Savings Calculator is a simple tool that helps businesses calculate the potential cost savings that can be achieved by outsourcing some of their work. The calculator uses a simple formula to estimate the total annual savings that a company can make based on its current number of employees, their average rate, and the outsourcing savings rate.

**Formula and Calculation**

The formula used by the Outsourcing Savings Calculator is:

S = 251 * 8 * #E * AHR * OSR

**Where,**

- S = Total Annual Savings ($)
- #E = Current Number of Employees
- AHR = Average Rate of Employees ($/hr)
- OSR = Outsourcing Savings Rate (%)

To calculate the total annual savings, simply input the current number of employees, their average rate, and the outsourcing savings rate into the calculator and click the ‘Calculate’ button. The calculator will automatically perform the necessary calculation and display the result.

**Example Calculation**

Let’s say a company has 50 employees with an average rate of $20 per hour, and they are considering outsourcing some of their work to save costs. If the outsourcing savings rate is 25%, then the potential total annual savings can be calculated as follows:

S = 251 * 8 * 50 * 20 * 0.25 = $100,500

This means that by outsourcing some of their work, the company can potentially save $100,500 in a year.

**FAQs**

**How accurate is the Outsourcing Savings Calculator?**

The calculator uses a simple formula to estimate the potential cost savings, and the accuracy of the result will depend on the accuracy of the input values. However, it provides a good estimate of the potential cost savings that can be achieved through outsourcing.

**Can the Outsourcing Savings Calculator be used for any type of business?**

Yes, the calculator can be used for any type of business, as long as the input values are accurate.

**Can the Outsourcing Savings Calculator be customized?**

Yes, the calculator can be customized to suit the specific needs of a business. For example, the formula can be modified to include other factors that affect cost savings.

### Conclusion

In summary, an Outsourcing Savings Calculator is a useful tool for businesses that are considering outsourcing some of their work to save costs. By using the simple formula provided, companies can estimate the potential cost savings and make informed decisions about outsourcing.