Nearshore vs. Offshore Outsourcing: What’s Best for Me?

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Businesses across the globe are starting to venture outside their office walls to supplement daily workloads. This trend is reflected in the market size of the outsourcing industry, which has exploded over the past two decades. In fact, it’s grown from $45.6 Billion to $85.6 Billion in less than 20 years.

The growth isn’t a coincidence; many companies are coming to realize the advantages of business process outsourcing (BPO). From multinational giants to mom-and-pop shops, any-sized organization can leverage the benefits of BPO.

If you’ve started searching for an outsourced provider, chances are you’ve seen the term “nearshore” vs. “offshore“. But what do these words actually mean? Is there a difference between the two services? Continue reading to find out.

Understanding The Difference Between Nearshore and Offshore BPO

Over the years, outsourcing your back office functions has become synonymous with cost savings, skilled talent, and measurable deliverables. However, it’s important to note that results may vary, and your success is largely based on the outsourcing model you choose.

What Does Offshore Outsourcing Mean?

Understanding the differences between nearshoring vs. offshoring doesn’t need to be confusing. Simply put, offshore outsourcing refers to the process of delegating tasks to third-party workers in a foreign country.

To be considered “offshore,” the support staff needs to be located in a region with a considerable time difference from your home nation, usually eight hours or above. For example, a company located in the United States engaging with a BPO service in India, the Philippines, China, or Ukraine would be considered going offshore for extra help.

Pros of Offshore Outsourcing

Companies often choose to outsource their workload with an overseas partner due to the following benefits:

  • Access to a global talent pool
  • Cheap support teams
  • Wide range of BPO services

Cons of Offshore Outsourcing

However, it’s important to note there are some risks if you choose to go offshore, including:

  • Significant time-zone differences
  • Losing control over daily activities
  • Different workplace and national cultures
  • Difficult to visit or maintain in-person communication
  • Disparate attitudes toward hierarchy, scheduling, and responsibility

Nearshore outsourcing serves as a happy medium for businesses that need to supplement their workload but want more control over the process.

What Does Nearshore Outsourcing Mean?

Similar to supplementing your workload overseas, nearshore outsourcing also involves working with a third-party from a foreign country. However, with nearshore BPO, there isn’t a huge time-zone difference.

Taking your back office support nearshore usually involves working with a neighboring country located less than three hours of air travel away from your business. To put it into perspective, a US-based company that delegates back-office tasks to Mexico would be working with a “nearshore” BPO provider.

Pros of Nearshore Outsourcing

Now that we’ve covered the main differences between nearshoring and offshoring, let’s explore why nearshore providers are regarded as front-runners in the BPO industry.

Seamless Customer Service and Cultural Affinity

Companies who decide to take their BPO overseas often experience their fair share of communication complications. This can be problematic because it’s essential to deliver high-quality communication throughout every aspect of the customer experience.Failure to do so can hurt your company’s reputation and, in return, profit margins.

Proximity to your client base is a huge benefit to nearshore services. By outsourcing to a neighboring country like Mexico, your support staff shares a cultural affinity with your customers, communicating easily to improve customer experience.

Budget-Friendly Support Solutions

When evaluating nearshoring vs. offshoring, another crucial factor to consider should be affordability.

Most businesses outsource tasks to improve their profitability, as investing in the resources to handle back-office procedures in-house gets expensive. However, by partnering with a nearshore BPO, you simply need to pay for a monthly, predictable fee.

Instead of covering the costs associated with salaries and physical infrastructure, going nearshore means you get the same dependable service as you do with an in-house team—but for far cheaper.

Time For Your Business to Supplement Its Workload? Partner with Your Neighbors at GGA Solutions

Looking for a cost-effective way to supplement your workload? As a nearshore BPO located in Tijuana, Mexico, GGA solutions specializes in providing high-quality support that fits your budget.

On average, our solutions are 40% cheaper than US workers. English is the first language for over 85% of our employees, as most received their education in the United States. You need a BPO who fosters effective communication with your clients—and that’s exactly what we do.

Get in touch with our experts to learn what GGA can do for you.