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Outsourcing vs. Nearshoring vs. Offshoring: Which one suits your business best?

Outsourcing, nearshoring, and offshoring are among the names used to describe companies that have outsourced their work overseas. While they all have similar meanings, there are some key differences that you should be aware of when determining which one best suits your company’s needs. We will tackle each of them.

Starting from the basic: Outsourcing

Outsourcing is the act of having a business with a particular company to perform tasks or provide services on your behalf. It is known as a third-party provider. This can be beneficial to your business in many ways. The main advantage is that you can do cost-cutting. Outsourcing delivers services with expertise from a highly skilled workforce at a fair price. You can concentrate on the other core processes of your business while your outsourcing provider handles the rest. You also do not have to worry about delegating everything else, as they have already proven success in this area.

Outsourcing with FBC Asia Pacific Inc.

We provide solutions tailored for your business needs and help you build your outsourced dream team. For instance, the Philippines has a large population of English speakers, which makes it an ideal place to get your services and work. In a recent study last 2021, it was found that Philippines ranked as the 18th most proficient country in the world and placed 2nd in Asia—just behind Singapore. Philippines continues to provide great business value as BPO is the second-largest contributor to the country’s GDP making it a top tier location for outsourcing. Consider the Philippines as your next outsourcing destination.

What to know about nearshoring?

Nearshoring lets your business expand its reach by contracting out work to a nearby place or country. For companies that want accessibility to their team and operations, this option can prove useful. Due to geographical proximity, nearshoring is much more accessible and flexible than offshoring.

For example, if your business is based in the United States and you outsource your service to a third-party provider in Mexico, since they are nearby, travel costs will be reduced, and you can save more. When you want to communicate with the team, it will be easier and more productive if you share a common time zone.

This is a notable difference between nearshoring and offshoring. There will also be fewer cultural differences, a similar working culture, and the language barrier will be minimized. It is known that offshoring provides a wide pool of talents, but nearshoring can be more challenging because you are narrowing down and limiting your options to nearby territories. This can have slightly higher costs than offshoring.

What is offshoring?

Offshoring is a process in which companies hire workers from another region or distant country to perform certain tasks. You can get a great deal on services while reducing costs by partnering with an outsourcing/offshoring provider. Hiring for hard-to-find talents is costly if you are in your country, but with offshoring, you can hire a competitive workforce from a developing nation that tends to have lower labor costs. This is due to the low cost of living. In addition, while there might be delays in communication due to time zone differences, you can manage and operate your business for 24 hours, seven days a week.

Offshoring with FBC Asia Pacific Inc.

If you own a business and are interested in hiring professionals in other parts of the world, FBCapac has a workforce available not just in the Philippines but also in Sri Lanka. According to the data, Sri Lanka ranked 9th place as one of the most leading-edge locations for offshoring with over 300 IT and BPO companies. This works well with the recently implemented Personal Data Protection Act No. 9 of 2022 (the “Act” or “PDPA”), which was patterned after the European Union’s General Data Protection Regulations (GDPR). This means that your personal data will be protected and handled properly by the company.

Which among these suits your business best?

Whether it is outsourcing, offshoring, or nearshoring, all can be effective and efficient to reduce costs without compromising the quality of work. Also, all the mentioned countries in Asia have cemented their names as providers of outstanding and stellar outsourcing and offshoring services.

Let FBC Asia Pacific Inc. help you grow your business. Talk to an expert for a free assessment.

Talk to an expert and see how outsourcing can work for you.