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Toll Free: 1 800 371 6224 | US: +1 650 204 3191 | UK: +44 8082 803 175 | AU: +61 1800 247 724 | Philippine Local No: 63-2-83966000

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Home | Blog | Outsourcing Setups that SMEs Can Choose From

Outsourcing Setups that SMEs Can Choose From

By Magellan Solutions

Updated on June 5, 2024

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There are different outsourcing setups, and they vary according to your business needs. This article will list the advantages of different outsourcing setups and discuss the optimum conditions on where and how to deploy them. Let’s get this going.

Different Outsourcing Setups and Its Advantages

Listed below are some of our outsourcing models that you may find helpful.

1. Third-Party Outsourcing

Third-party outsourcing is the most common delivery model associated with BPOs in the Philippines. It involves transferring tasks to an entity outside the organization. According to a study by the Everest Research Institute, outsourcing to an offshore vendor is more affordable than establishing a captive unit owned by the company.

2. Project-Based Outsourcing

Suitable for companies looking for short-term cost savings on one-time or test projects of low to medium complexity. This model is ideal for projects with well-defined requirements. You may choose this if demand is irregular or you cannot hire full-time employees.

3. Dedicated Offshore Center

Clients who want a cost-effective alternative to in-house production often use an option. Dedicated offshore centers establish a team of local professionals. This team would be working full-time for the client.

4. Captive Centers

They are also called offshore shared services. Captive centers are an in-house delivery model. The company owns some business process facilities in locations outside its principal office. As a subsidiary, it allows the company to support lower-cost offshore resources. Meanwhile, it maintains complete control over processes.

5. Hybrid Model

Today, captive centers have matured into a hybrid model. These models could represent 15 to 20 percent of all work sent to offshore providers. At least 80% of the captive units in Manila alone provide voice, back-office, and IT-related services. About half of the captive units providing voice services are owned by a U.S. company.

Reasons to outsource to the Philippines according to our existing clients

We oftentimes ask our existing clients why they choose to outsource to the Philippines in general and with Magellan in particular. Listed below are the reasons why.

Full control of the business

With staff offshoring, you are still the boss. Outsourced staff would concentrate on operations and business projects according to your instructions. It is also important to remember that communication is critical. Indirect access to the team can cause language barriers, miscommunication, and cultural gaps. This may lead to poor results and even failure to meet your expectations.

Cutting operations cost

Cutting costs is one of the most common attractions. This is one of the many reasons industries decide to offshore their operations. Outsourced staff causes:

The pricing for staffing offshore is also cheaper. This is in comparison to business process outsourcing.

Dynamic team

An offshore team in the Philippines usually consists of young individuals. These individuals have fresh ideas creative input, and are solution-oriented when dealing with problems. This makes the country excel in many fields and makes us one of the top choices for outsourcing jobs.


You don’t need to waste any of your time. We set up your operations and a suitable office for your staff. We also take advantage of the time difference, offering a 24/7 working team. Even if you are resting, your business continues its operations with us.

Government support

The government has been integral to BPOs’ success in the country and has backed the industry for over 25 years.

Support provided includes:

Multilingual speaking agents

GlobalEnglish Corporation says the Philippines has the top spot for business English skills. At least 90% of the country’s population are English speakers, which has become a significant advantage in the Philippine outsourcing industry. Many Filipinos also speak other languages.

Still can’t find the perfect setup for you? Let’s talk!

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      Outsourcing Setups that SMEs Can Choose From

      Magellan Solutions

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