What are the advantages of offshoring?
2022-01-19 /

Top 10 Advantages of Offshoring

When it comes to hiring employees, there are many advantages of offshoring. What are they? Read on to find out the top 10 benefits and learn why you should use offshoring for your business.

For many decades, offshoring has been an innovative solution for many businesses. Initially, its primary focus was on production assembly tasks. 

Today, offshoring has evolved to employ customer service, sales, and even IT solutions. Small- and medium-sized companies enjoy offshoring advantages, including cutting costs, solving hiring problems, and generating output. But what are its other benefits? Let’s find out.

Top Offshoring Advantages Today

When companies do offshore outsourcing, they reap many benefits from it. Here are the top 10 advantages:

1. Lowers Salary Costs

On average, a US developer earns a gross salary of $108,991. In comparison, a software developer in the Philippines will make $16,789.89. Evidently, there is a significant difference between compensations for IT talent in the US compared to offshore locations.

Offshore teams are prevalent in IT software development. As labor costs vary immensely businesses benefit from salary costs savings and allocate more funds to the company. Hiring offshore means getting the same quality IT software developer for a lower cost.

2. Higher Savings on Operational Costs

Maintaining an office in the U.S. means higher costs in real estate. Besides that, you also have to think about business taxes, utilities, and labor costs. One would need to put up a considerable amount to invest in an office. 

When you hire offshore, you reap the benefits of lower rates including real estate. Moreover, developing countries have lower rates in Social Security benefits, Medicare, taxes, and insurance compared to the U.S.

There is a lot of opportunity for growth when you choose to build an offshore team. Besides its impact on finances, you can be more productive by hiring a qualified workforce. 

3. Access to Qualified IT talent

One of the most significant limiting factors in business is finding highly-qualified employees. Additionally, with the ongoing IT talent shortage in the U.S., you have to find solutions to that big problem.

India and the Philippines are only two examples of countries where you can hire your IT staff. The IT industry is flourishing in these countries due to active government support and IT programs. 

Also, schools are producing more graduates per year. You are sure to find the right candidate to hire. These two countries are included in the top offshoring destinations, especially in tech development.

You can also opt for an offshoring provider, like Full Scale. The company is built to pre-screen candidates and connect them with clients. We provide you with access to a qualified talent pool without the hassle of recruiting one yourself.

4. Time Zone Differences

Managing teams both onshore and offshore creates higher productivity. Offshore teams can cover time zones not covered by your onshore team. The continuous workflow between projects will allow you to deliver faster and increase client satisfaction.

Create a proper handover process for what to do next. That way, your onshore and offshore teams can work smoothly. Now, you are technically operating 24/7. Just don’t forget to encourage work-life balance practices for your teams.

5. Tax Benefits and Financial Incentives

There are countries, like the Philippines, that offer tax holidays and financial incentives directed for foreign investments. This encourages more foreign companies to invest in the workforce, provide opportunities, and stimulate growth for businesses.

Creating more jobs at the offshore location and returning earnings to the investing country also helps both economies thrive. You maximize profit when your offshore company earns revenue paired with these offshore benefits.

6. Better Control Over Operations

There are two options if you want to hire globally. You can either outsource talent or hire offshore. With offshoring, you don’t need to hand over business operations. In contrast, business operations are limited by outsourcing. You must know the difference between both, especially if you’re planning to build a global team.

Partnering with an offshore company allows you liberty and control over your team. You can opt to train your staff or provide instructions to your offshoring partner. Ultimately, you have complete control over the tasks, while the offshore partner delivers your requirements.

7. Sustainable Scalability

Growing your business requires focus and strategic planning, not to mention challenging. You need to be smart about spending your money, especially when hiring employees.

Let’s say your software team is in the middle of a sprint, one left. This affects project timelines so you have to make adjustments and replace that employee quickly. Your team should allocate the work between themselves while you’re looking for a replacement. Not only that, your recruitment team needs to find someone, train, and deploy.

You see, if you are looking and hiring candidates yourself, you spend a lot of money maintaining the recruitment team. Partnering up with an offshoring company will help solve this scenario quickly. 

Offshoring companies have a database of pre-qualified candidates for their clients. When one employee leaves, they already have a backup candidate with the right skillset. This saves you a ton of money and effort than maintaining your HR and recruitment team. 

By working with offshoring partners, you are free to shift your focus on business initiatives. In effect, scaling your business becomes more manageable.

8. No Retraining

Uninterrupted work helps teams be more efficient and productive. Hiring offshore, you choose the team that is solely working for you. It is similar to an in-house team; the only difference is they’re not in the same location.

When you assign new projects to your offshore team, they already know how to fulfill the task. Once you have trained your offshore staff, you will only need to nurture and hone their skills. Continuous learning helps keep them updated with trends and new technologies to serve your clients better.

9. Opening Up Opportunities in New Locations

Having an offshore company can help you explore new opportunities in that country. Your labor force can help you find a new market or perspective. Culture also influences how you can better connect with this new market.

Offshore teams can better understand people in the location and give you an insight into the buyer persona. With their help and input, you can identify where to make investments for your next business venture.

10. English Language Proficiency

Communication is an essential part of collaborating with your offshore team better. With that in mind, you should choose the best country known to have high English language proficiency.

The Philippines ranks 18th out of 112 countries globally regarding language proficiency. We know that nearly half of the offshoring market comes from English-speaking countries. We want our team to communicate with their clients with ease. This high language proficiency rate is one of the reasons why we choose to hire our developers here. 

How to Choose the Right Offshoring Location

There are a lot of offshore locations that you can consider. But how can you choose the right one? Here are some questions that you need to answer before deciding where to hire offshore:

  • How many developers do I need to complete my project in a specified timeline?
  • Will my offshore team understand the requirements and priorities defined during onboarding?
  • How much will it cost me?
  • Is there high availability of qualified programmers in the location?
  • How much time will I spend training my offshore team?

Knowing the answers to these simple questions will help you filter out which locations are favorable to you. One way to make your offshoring journey more effortless is to find a reliable offshore company. 

Offshore with Full Scale

We know that finding and hiring the right developers is challenging. That’s why we built our company to help find the right solutions to the U.S. IT talent shortage. We already did a big chunk of the work for you. 

At Full Scale, we are actively looking for new additions to our team who are qualified to serve our clients. Candidates go through a rigorous hiring process and assessment to ensure that they have the right skills for the job. All you need to do is choose from our pool of developers and set an interview. It’s that simple.

Work with us and shift your focus on your business strategies to help you grow. Set an appointment here to provide you with options on how we can help you reach your big business goals.

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