How business is conducted is called the manner of business. Outsourcing is referred to as the new model of business as it has brought changes the way business is conducted and it is referred as an emerging mode of business, it is different from traditional thinking of business where firms were self-sufficient and do most of the work in-house, now companies can outsource their work to third parties to gain from their expertise, experience, efficiency and even investment, and focus on their core work where they are good at. Generally, non-core activities were outsourced, but now companies also outsource core activities like sales, accounting, human resource management etc.

Factors responsible for the growing importance of this trend-

• Improved business process – as companies can outsource activities in which other partners have a specialisation, have better experience and expertise, it improves the efficiency of the firm.

• As the consumer demands are growing, e-business facilitate meeting the demand of customers from a larger geographical area, with e-business and outsourcing of delivery, it can be achieved

• With the increasing competition among the firms in a rapidly changing environment, innovation in product and process is key for sustainable business, outsourcing facilitate continuous development of new business strategies and new product.

• To remain competitive, cost-cutting is important, many companies outsource their manufacturing to the developing and underdeveloped where labour is available cheap to cut down the production cost.