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Home | Blog | Don’t Know Where to Outsource? Why The Philippines is a No-Brainer

Don’t Know Where to Outsource? Why The Philippines is a No-Brainer

By Magellan Solutions

Updated on July 26, 2024

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Are you facing the dilemma of deciding where to outsource some of your non-core business activities?

The technological revolution has allowed industries worldwide to grow. It’s a no-brainer that most businesses, especially in the western part of the globe, have been outsourcing their work. It’s now commonly acknowledged that cost optimization is the main propeller of growth. An even more critical propeller is the global quest for talent and excellence.

We live in a small world that becomes more interconnected through the widespread use of various gadgets, software applications, and high-powered internet connections.

Western companies can gain insights from an expert working on the other side of the world within seconds.

It’s also a no-brainer why the Philippines is rapidly becoming one of the most prominent outsourcing destinations worldwide.

Already serving companies in North America, Asia Pacific, and Europe, the Philippines established itself as an essential offshoring service destination and an international industry leader in voice-related work. The United States, for example, makes the Philippines its preferred overseas site for voice-based services in outsourcing.

Since 2011, more and more US companies have relied on Filipinos for outsourcing work. The rapid multiplication of countries investing in the Philippines proves that the government should be the best choice for outsourcing needs.

Still not convinced? Here are five excellent reasons why the Philippines is the perfect environment to outsource your business:

 

Specialized and available workforce

outsourcing destinations

Image source: World Economic Forum

 

The success of the Philippines in the outsourcing industry is mainly attributed to its high-skilled and well-educated workforce. A World Economic Forum article ranked the Philippines as Asia’s third proficient English-speaking country, with a 60.33 literacy rate. Reputable universities and colleges provide many candidates to meet the demands of the rapidly growing outsourcing industry. More than talent, Filipinos are naturally friendly and hardworking — values suited for the service-oriented nature of outsourcing.

 

Cost-efficient advantage

The Philippines is consistently ranked as one of the most cost-competitive outsourcing destinations, particularly in the information technology sector. The country has a substantially lower cost of living compared to other countries. This is among the significant reasons the salary in the Philippines is a small percentage of those in Western countries. Beyond labor costs, operational expenditures such as office space, utilities, and equipment are undeniably cheaper. These significantly affordable costs allow business owners and investors to save more and earn higher profits simultaneously.

 

Cultural Adaptability

The Philippines has a rich historical culture. Its receptiveness to Western culture and ideas can be traced back to 400 years of shared culture with Spain and the US. This continues to shape Filipinos’ lifestyles, including their ability to communicate and build rapport quickly with people from different races.

 

High-quality telecommunications

The country’s fast-expanding and rapidly improving telecommunications and IT infrastructures are notably adequate to support corporate transactions of outsourcing companies. Digital connectivity is solid and consistent, enabling reliability and convenience for an outsourcing environment.

 

Government support

The strong support of the Philippine government has enabled the outsourcing industry’s continued growth. The government has actively encouraged investment through fiscal and non-fiscal incentives. Depending on the nature of the business, incentive packages include income tax holidays and duty-free importation of specific equipment. The industry has become one of the country’s main revenue drivers, which is why outsourced companies are entitled to special privileges from the government. On top of these benefits, the government also focused on developing human capital through education and training to produce more talent for the outsourcing sector.

 

Data privacy and cybersecurity

The BPO industry is among the most vulnerable or high-risk sectors in terms of data breaches and cybersecurity threats. It is good that most Philippine BPO companies comply with international data and information security standards. It is about the quality of service delivered to customers and how to protect their data.

 

Industry upgrade

Around 2018, automation started threatening call center jobs in the country. Despite this, many still argue that artificial intelligence can’t provide the same level of service and empathy to angry customers — reassuring the industry’s stability.

Humans and automation aren’t supposed to clash anyway.

A World Economic Forum article says, “While machines will be increasingly powerful, humans will be more essential.”

In what way can humans take advantage of machines?

Skills upgrade.

The Philippine BPO industry has started encouraging its employees to level up their creative and technical skills to meet the demands of this technology-driven world. If they knew how to manipulate AI, they wouldn’t be slaves of automation.

 

How to outsource in the Philippines

Looking for outsourcing destinations is easy. Choosing a BPO partner is quite a task. However, maintaining a good business relationship is challenging.

When planning to outsource in the Philippines, you need to consider specific steps to ensure a successful business relationship.

First, it should all begin inside. Determine the business functions that you need to outsource. Outline the elements required for the task. What are your expectations and limitations? Only by knowing what you need on the inside will you find the perfect BPO partner that can assist your business well.

Second, identify the tools that the function would need. Check if the BPO company has similar software or if it is willing to provide it. Aside from the tools, determine the number of staff you need and the estimated time to complete a project. Is it a long-term partnership or a short one?

Third, identify your outsourcing budget. After this, you can get a quote from the short-listed companies that you have.

The Philippines is one of the world’s perfect outsourcing destinations for the above reasons.

If you’re interested in this business activity, contact us now to help.

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