What are the world’s leading offshoring locations for your business?
These days, going offshore to find talent and resources to expand and further improve your business is a no-brainer. Companies of all sizes either relocate their operations offshore, or create an extension of their office in an offshore location. Employers either use online job platforms or seek the services of a Business Process Outsourcing (BPO) company in top offshoring locations to outsource.
The offshoring strategy
Offshoring is a cost-effective business strategy where businesses move some of their business functions to an offshore location to enjoy the variety of benefits that it offers. Offshore outsourcing seeks the help of a third party provider to provide the company with dedicated and efficient staff.
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This strategy is usually catered to North American and European businesses due to the high costs of running a business in these regions. From office spaces, parking spaces, equipment, employment costs, bonuses, insurances, government taxes, operating expenses in the West is proven costly – and frankly, not practical.
By offshoring, businesses get to enjoy various benefits, all while helping the country where the outsourcing provider is located.
While this can be a win-win partnership for the business, the outsourcing provider, and the offshore destination, it can still be pretty overwhelming. After all, there are a number of established and rising offshore outsourcing destinations all around the world to choose from.
Leading offshoring locations in the world
Here’s a list of the leading offshore destinations around the globe:
The Philippines is always included in the offshoring destinations list. For decades, the country’s highly proficient employees and graduates have been offering services and skills to businesses on the other side of the world.
At the start of the outsourcing industry in the Philippines, the country is pretty much the world’s biggest supplier of call center services. In 2015, the Los Angeles Times even dubbed the Philippines as the call center capital of the world.
The country specializes in providing excellent customer service and IT support. However, the past several years gave the country a chance to enhance employees’ skills on graphic design, telehealthcare, bookkeeping, social media management, and more.
Further, the country is looking to upskill one million workers in the next five years. The country’s BPO industry has strong government support and a world-class pool of talents combined.
Here are other reasons why the Philippines is a top offshore outsourcing location:
- Filipinos are English-proficient and can speak clear English without thick accents;
- The country’s BPO organizations have long-term plans and goals for the sector;
- Low cost of living, resulting in more affordable packages;
- Companies offer round-the-clock services and can adjust to your time zone;
- Filipinos are known for their hospitality, resourcefulness, adaptability, and willingness to please.
India remains on top of Tholons Global Innovation Country Index, which ranks the Top 50 Digital Nations for global offshoring. The country specializes in its technical competence, especially in the fields of software programming and technical support, as well as customer service. In fact, India’s software outsourcing industry is $129.5 billion as of 2016) – bigger than that of the entire Europe.
The country is also the second largest English-speaking nation in the world, second only to the United States. India prides itself on its continuously growing professional population. As of 2018, the country has a labor force participation rate of 49.8%.
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Here are other reasons why India is a top offshore outsourcing location:
- The country’s BPO firms have proven experience with Fortune 500 companies;
- It offers very cost-effective solutions;
- The country’s outsourcing industry has strong government support;
- Companies offer round-the-clock services and can adjust to your time zone.
China may not be considered as “English proficient” as compared to India and the Philippines, yet it remains as one of the top offshore outsourcing destinations in the world.
The “Red Dragon” specializes in information technology, pharmaceutical research and development (R&D), and of course, manufacturing. It’s incredibly low cost manufacturing services and labor expenses are main reasons why Western countries offshore outsource to China.
China is the largest manufacturing nation in the world, and it accounts for 20 percent of the global manufacturing.
Here are other reasons why China is a top offshore outsourcing location:
- It provides very affordable labor services and products;
- China has the highest population in the world, making manpower abundant;
- Manufacturing companies in the country have vast experience in dealing with foreign companies. In fact, the majority of companies have factories in China;
- The country invested heavily in its telecommunications and internet infrastructure to attract more investors.
Malaysia is a rising country for outsourcing. Its well-developed infrastructure, strong government support, and IT proficiency makes it a star to watch out for in the offshore outsourcing industry.
Last year, A.T. Kearney’s 2019 edition of the Global Services Location Index™ ranked Malaysia as third out of 50 countries for its Global Digital Resonance 2019 rankings. The ranking is based on the countries’ potential and fit to deliver business services to global companies.
Malaysia represents around 1.7% of the total BPO market in the Asia Pacific, but experts are predicting that it will only continue to grow even more.
Here are other reasons why Malaysia is a top offshore outsourcing location:
- It has dedication to serve as an IT hub in the Asia Pacific region;
- The country offers balanced opportunities for global players in terms of investment ownership and control in the country;
- Malaysia has investor-friendly policies and strong government support.
The only European country in the list, Poland offers a variety of offshore services, specializing in finance and accounting. It’s one of the biggest IT players in Eastern Europe, and is arguably the pioneer of outsourcing.
Over the years, Poland has become home of the largest IT outsourcing companies in the world, like IBM, Accenture, Luxof, Amway, Carlsberg, and hundreds more. Further, while the cost is definitely not cheaper compared to Asian countries, Poland offers relatively cost-effective pricings compared to its nearby outsourcing locations.
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Here are other reasons why Poland is a top offshore outsourcing location:
- It has a stable and healthy economy, in addition to strong government support;
- The country sets US and EU standards when it comes to intellectual property and data security measures.
- It’s geographically closer to the west.
- Poland ranks 11th out of 100 countries in the English Proficiency Index.