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Introduction to Offshoring

Offshoring is the practice of outsourcing certain business functions or activities to a foreign country, usually to take advantage of lower costs, higher quality, or better availability of talent. Offshoring can help you reduce your operational expenses, improve your productivity, and access new markets.

Some examples of business processes that can be offshored are:

Customer service: Many companies utilize call centers in countries like India, Philippines, or Mexico to handle customer inquiries, complaints, or feedback.

Accounting and finance: Some businesses outsource their bookkeeping, payroll, tax preparation, or auditing tasks to firms.

Information technology: Many software development, web design, data analysis, or cybersecurity projects can be done by teams in offshore countries.

Manufacturing: Some products or components can be produced more cheaply.

Offshoring to the Philippines

Getting Started with Offshoring to the Philippines cityscape

One of the most popular destinations for offshoring is the Philippines, a Southeast Asian country with a population of over 100 million people.

The Philippines is among the leading countries in offshore business services worldwide.

In fact the Philippines ranked 9th in the leading countries in offshore business services worldwide in 2021 with an index score of 5.96. The index score was based on the following criteria: Financial attractiveness assessment, People skills and availability assessment, Business environment assessment, and Digital resonance assessment.

The Philippines has a number of advantages that make it an attractive option for offshoring, such as:

A large pool of skilled and educated workers, especially in the fields of information technology, business process outsourcing, and creative services. The Philippines has a highly specialized talent pool with employees who have worked for large multinational and business process outsourcing companies.

Next, the country has a relatively low cost of living and labor, which translates to lower salaries and overhead costs for your business.

The Philippines is regarded as a highly literate and proficient English-speaking country. The Philippines has a high level of English proficiency, as English is one of the official languages and widely used in education, media, and business.

Also, the Philippines has a favorable time zone, as the country is only one or two hours ahead of most Asian countries, and within the same day as Australia and New Zealand.

Lastly, the Philippines is a democratic country with stable political and economic environment, a free market economy and strong ties with the US and other allies.

Read more about the top 5 reasons to offshore to the  Philippines discussed in our previous article.

If you’re interested in getting started in offshoring to the Philippines, there are several steps you can take.

Getting Started with Offshoring to the Philippines

First, you need to have a clear vision of what you want to achieve by offshoring, such as reducing costs, increasing efficiency, expanding your customer base, or enhancing your innovation. You also need to identify the key performance indicators (KPIs) that will help you measure your success and progress.

Next, there are different ways to offshore your business processes to the Philippines, depending on your needs and preferences. You can either set up your own subsidiary or branch office in the country, hire a third-party service provider or agency, or use a hybrid model that combines both options. Each model has its own benefits and challenges, so you need to weigh them carefully and consult with experts if needed.

You also need to consider factors such as accessibility, connectivity, security, cost of living, and availability of talent when choosing your location.

The Philippines has several cities and regions that offer excellent infrastructure, amenities, and talent for offshoring.

The country also has over 415 economic zones that provide world-class facilities and amenities for offshoring businesses. Some of the most popular ones are in urbanized cities such as Manila, Cebu, Clark, Davao, and Iloilo.

Investors planning to offshore to the Philippines are also eligible to fiscal and non-fiscal incentives. Tax Laws such as the 1995 Special Economic Zone Act were legislated to promote investments in the growing Philippine offshoring industry.

Once you have decided on your offshoring model and location, you need to find and recruit the right people for your offshore team. You can either do this yourself or outsource it to a recruitment agency or service provider. You also need to provide adequate training and orientation for your offshore team, so they can understand your business culture, values, goals, and expectations.

Lastly, offshoring requires communication and collaboration between your onshore and offshore teams, so you need to establish clear channels and methods of communication. You also need to use tools and platforms that facilitate remote work, such as cloud-based software, video conferencing, project management systems, and chat applications. You also need to provide regular feedback and recognition for your offshore team, as well as address any issues or challenges that may arise.

Offshoring to the Philippines can be a rewarding and profitable venture for your business if done right. By following these steps, you can ensure a smooth and successful transition to offshoring and enjoy the benefits of working with a talented and cost-effective workforce in the Philippines.

In conclusion, offshoring to the Philippines presents a compelling opportunity for businesses looking to reduce costs, enhance productivity, and access a skilled workforce. With its abundant talent pool, favorable business environment, and English proficiency, the Philippines has emerged as a top destination for offshoring. By following the steps outlined in this guide, including defining your objectives, choosing the right offshoring model and location, recruiting and training your offshore team, and establishing effective communication channels, you can embark on a successful offshoring journey. By leveraging the advantages of offshoring to the Philippines, you can unlock new possibilities for your business, expand your global presence, and drive long-term growth.

Connext Global Solutions provides Quality Offshoring Solutions

Connext Global Solutions helps manage a client’s team as if it was theirs and makes sure the performance matches or exceeds that of your local teams.

Industries Connext Caters to:

1. Healthcare Providers

2. Distribution

3. Telecommunications

4. Title and Escrow

5. Property Management

6. Accounting

7. Banking

8. Technology

9. E-Commerce

10. Retail

11. Construction

12. Professional Employer Organization

13. Insurance

Connext Global Solutions helps companies build custom, dedicated support teams. Learn more about working with Connext Global Solutions

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Twitter: @ConnextPh 

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