February 1, 2022 •Andrew Reiter
When outsourcing customer service, there are three options:
- Offshore refers to outsourcing to a faraway foreign country. For a U.S. company, an offshore location could be India or the Philippines.
- Onshore refers to outsourcing within the same country.
- Nearshore refers to outsourcing to a nearby foreign country with similar time zones. For a U.S. company, a nearshore location could be Mexico or Puerto Rico.
Many businesses find that call center outsourcing gives them benefits over hiring in-house, especially since a business process outsourcing company handles staffing, training, and infrastructure. But not all outsourcing is created equal. Which contact center option is right for you?
While the first thing that comes to mind is cost, sometimes cheapest isn’t always best. It's worth understanding the pros and cons of each outsourcing option to choose the right partner for your call center services.
The differences between offshore, onshore, and nearshore include:
- Labor costs
- Quality of service
- Data security and technology
- Language, accents, and culture
- Accessibility for visits
What is Offshore Outsourcing?
Offshore outsourcing is located in a foreign country, including around the world, like Southeast Asia and Eastern Europe. The Philippines, India, and Ukraine are popular countries to outsource call center operations.
The biggest advantage is cost savings because offshore call centers often pay lower wages. But the results can be positive or negative, and you want to avoid damaging your brand, which can impact ROI and be hard to recover from.
Benefits of offshore outsourcing:
- Low cost
- Competitive call center market.
- Plentiful labor supply for large operations.
- Conducive to overnight shifts for U.S. hours.
- Government support to bring jobs to their country.
- Multilingual agents
Disadvantages of offshore outsourcing:
- Cultural barriers can leave customers frustrated and unhappy.
- Language barriers, or speaking English not translating to empathetic service.
- Privacy concerns
- Lack of control
- Lack of transparency into call center and contact center analytics.
- Mismatched values when brand expectations and values aren’t aligned.
What is Onshore Outsourcing?
Onshore outsourcing is known as domestic outsourcing. With onshore outsourcing, you get agents in your own country who speak the same language.
Although this often comes with a higher price tag, many businesses enjoy savings over time with better customer retention, increased efficiency, and clear and easy communication with the call center.
Benefits of onshore outsourcing:
- No concerns about language or cultural barriers.
- Customers and agents connect better through relatability, enhancing customer experience.
- Easier travel for training.
- Easier communication due to similar time zones.
- Stringent data security in compliance with U.S. laws and regulations.
Disadvantages of onshore outsourcing:
- Higher cost
What is Nearshore Outsourcing?
Nearshore outsourcing involves outsourcing to nearby foreign countries in similar time zones. For the U.S, places like Mexico, Puerto Rico, and Central and South America are considered nearshore.
Nearshore outsourcing balances the benefits of onshore and offshore.
Benefits of nearshore outsourcing:
- Up to 50% more cost-effective than onshore.
- Bilingual agents to help with U.S. demand for Spanish fluency.
- English fluency and cultural familiarity, since many agents have lived or worked in the U.S.
- Easier travel than offshore.
- Easier communication due to similar time zones.
Disadvantages of nearshore outsourcing:
- Often more expensive than offshore.
Which Call Center Outsourcing Should You Choose?
When choosing the right call center outsourcing, ask yourself: what are your priorities? The best customer experience? The most security? The lowest cost?
If you’re looking for the cheapest option, offshore outsourcing may be the best option for you to scale your customer support within your budget.
While it’s tempting to cut costs as much as possible, it’s important to find an outsourced call center that will represent your brand like you would.
If you have a larger budget, customer experience becomes the biggest factor for many companies. To secure customer loyalty and brand equity, these companies should consider an onshore or nearshore call center.
It’s important to do your due diligence to find the right BPO partner. At RUI, we streamline outsourcing with the best people, processes, and technology. With contact centers in the U.S. and in Mexico, we provide the best customer care to achieve your business goals. Contact us to see what onshore or nearshore outsourcing can do for you!
