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Why Australian Companies Outsource to the Philippines

By Magellan Solutions

Updated on June 10, 2024

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Australia (and New Zealand) have been outsourcing their business processes to the Philippines for quite a long time now. Rising costs, market saturation, and competition are just some of the reasons why businesses feel the need to lower their overhead expenses. This helps them maximize resources and expand profit margins, enabling companies to sustain themselves and the customers who do business with them. This has paved the way for the global outsourcing industry, which has grown exponentially in the Philippines over the last decade.


Here’s Why Australian Companies Outsource to the Philippines

Though the bulk of clients are American companies, the country has seen a surge in Australian clients as well. Here are some of the reasons why they outsource to the Philippines:


skill and expertise are one of the reasons why Australian companies outsource to the Philippines

1. Skill and expertise offshore

Just about anything can be outsourced to the Philippines, from repetitive back office tasks like data entry to complex processes that require specialized knowledge, such as legal work. Local service providers have the capacity and talent to offer a wide range of business solutions. However, the country is still best known for voice services and customer support.


2. Numerous options for Philippine outsourcing

There are many business models that clients can choose from. They may transact with a BPO company that can screen, hire, and manage an offshore account on their behalf. There can be more than one middleman involved in this type of arrangement. Fewer middlemen usually involve lower costs and less confusion, Which is why it’s ideal for Australian companies to get a referral from a trusted source or to make on-site visits to understand how a given BPO company operates.

Clients also bypass BPO companies and decide to hire freelance employees directly. They either advertise openings on Filipino job search websites or register for freelance websites. This option lowers costs drastically since Filipino freelancers are paid hourly rates that go as low as $5, depending on their qualifications and work experience.


The 2 hour time difference between Philippines and Australia is one of the reasons why Australian companies outsource to the Philippines

3. Two-hour time difference

A negligible time difference between Australia and the Philippines means Filipino service providers can easily adapt to the client’s time zone. This also means clients won’t have to pay extra for the night differential unless they’re interested in round-the-clock services. Filipino employees also prefer the 6 a.m. to 3 p.m. work shift that comes with Australian accounts because it helps them dodge rush hour.


4. Proximity

A typical flight from Australia to the Philippines lasts about six hours. The proximity and relatively cheap plane fare allow clients to make more frequent trips to their offshore sites, allowing them to make emergency visits whenever necessary. The light travel time also makes business trips more convenient.


5. Better jobs for onshore employees

By transferring low-cost jobs to the Philippines, Australian companies can develop high-skill, high-value jobs for their local employees. It also lets their staff focus on core tasks and increase their productivity. The key is to retain fundamental roles and high-risk jobs onshore. Outsourcing to the Philippines is highly beneficial for Australian companies that want to drive growth and create more local and international jobs. It plays a crucial role in cost savings and business expansion.


The Philippines has also proven to be a reliable offshore destination, with reputable and globally renowned BPO companies operating in different parts of the country. With the local market becoming increasingly crowded, Filipino service providers are incentivized to offer flexible business models and competitive rates to Australian clients. This is the reason why Australian companies outsource to the Philippines.


For Magellan’s most popular outsourcing services for Australian companies, please check out our call center services page.


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      Why Australian Companies Outsource to the Philippines

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