Love is in the air! And while couples are making the most of Valentine’s Day, more and more US companies are making a beeline for the borders—and it’s not for roses or chocolates. Let’s face it, the benefits of outsourcing, such as reduced long-term costs, liability and overhead, can certainly make businesses fall head over heels. A recent and rapidly growing outsourcing trend, however, has been making waves in the US, where adjacent and nearby locations like Latin America are proving to be dominant players. Let’s say hello to ‘nearshoring’.
The cost of living in the US is rising. So is the cost of doing business. These are the signs of the times. In order to lower operational costs and accommodate customer needs, many US companies are outsourcing to service providers in countries that are closer to home, otherwise known as nearshoring. But why go near rather than offshore? Because nearshoring allows US companies to realise greater productivity improvements, better morale and a stronger ROI.
Cost is, as ever, a main driver of outsourcing. Being closer to the service provider means lower travel costs and improved speed-to-market. More importantly, this erases the need for staff to work overtime or night time hours due to nearshore locations being within the same or similar time zone—this can dramatically lower the cost compared to offshoring.
Outsourcing to nearby locations is a logical way to maximise value and efficiency. Proximity (in terms of distance and time zone) of the client country to the nearshoring partner allows for faster and easier collaboration. Clients can visit and direct operations far more regularly, ensuring quality and consistency. Since both parties can operate in real-time instead of waiting a day to turn around a solution, there is greater productivity, as well as more steady and satisfied workforces.
Cultural affinity is key to effective collaboration and problem solving. And because Latin America shares an extensive border with North America, including a common history spanning more than 300 years, it is more familiar to the language and lifestyle of the nearshoring client. This translates into a more effective working environment, smoother business cooperation and financial synergy.
In the past, US companies have limited their offshore or nearshore functions to low wage and low responsibility jobs. The trend has begun to change, however, with higher-level jobs seeing an upsurge. The talent pool in geographically closer locations has been keeping up with this trend, with innovation hubs and technology popping up in the Caribbean and Latin America, making it more attractive for US companies to transfer even more complex work and responsibilities to its nearby shores.
As market trends, the economy, technology, cost of oil and labor practices continue to change, nearshoring is proving to be the better alternative, which is why US companies are increasingly tweaking their outsourcing strategies around it. Look closer to home and capitalise on the benefits of our nearshore operations in the Dominican Republic https://acquirebpo.com/solutions/.
Acquire BPO has chosen the Dominican Republic as the ideal US nearshore location when factoring in a strong mix of performance and cost.