Backsourcing is the process of terminating or expiring an outsourcing contract, which begins the process of re-establishing operations in-house. The primary reasons for companies to backsource include:

• High outsourcing costs and poor service quality.
• Loss of control.
• Management changes.
• Changes in company strategies.

The backsourcing process must be incorporated in the agreement or contract with the outsourcing business and cover measurable service level objectives and service delivery commitments of both sides to minimize misunderstandings and lower risk factors.