ABSTRACT
This chapter explores contracting with another party to perform a specific function which can provide cost savings. It investigates outsourcing from a historical perspective, and in areas where it is most widely used. The chapter analyses the three types of outsourcing of personnel that prevailed in Russia. Additionally, it examines tolling in sugar, ferrous metallurgy and light industries. Outsourcing is contracting with another subject to perform a specific function or a repetitive long-term task. Characteristically, the function and the task being outsourced are not considered vital to the business. Theoretically, outsourcing is able to provide cost savings and improved services through specialisation and economies of scale. Moreover, by using the services of professional firms, companies can employ their own resources in their most profitable segments. Modern Russian outsourcing is in the early stages of development due to a late start; however, there are already companies that provide outsourcing services.
