Comparing Outsourcing Locations: Nearshore vs. Onshore vs. Offshore

Flexibility is the hallmark of a great business. Outsourcing in various forms gives your organization the agility of a world-class boxer in your business. You can bob, weave, and engage with outside talent when needed instead of keeping someone on the payroll. These methods are especially advantageous for startups with tight capital or legacy businesses looking to evolve. Did you know there are three main options -onshore vs. nearshore vs. offshore – to choose from?

Why You Should Consider Outsourcing

Every business is like a snowflake; no two are alike, so every viable business option should be on the table. Whether your business is in software development, manufacturing, tax services, or even a law firm, there is an outsourcing option right for you. A recent Deloitte survey shows the top objectives for companies looking to outsource aspects of their business are:

  • Cost-reduction
  • The tight local hiring market
  • More opportunities due to global business practice standardization

Outsourcing is no longer reserved for the most prominent organizations in the world. No matter your size, you can utilize the benefits of outsourcing. Thirty-seven percent of small businesses now outsource at least one business process. Let’s review the outsourcing options of onshore vs. nearshore vs. offshore.

What is Onshore Outsourcing?

Onshore outsourcing involves using talent from the country where your business resides. You can think of this as freelance or contract workers from “local” locations. You will pay a premium for the onshore option, as the cost of living and everyday expenses will be the same as what you currently pay for employees on payroll.

Why Choose Onshore Outsourcing?

A few benefits of onshore outsourcing include choosing individuals who can come onsite for regular meetings, reduced cultural misunderstanding, and no monetary conversion fluctuations. If you have a project that requires only limited time, this could be your best option. Typically, nearshore or offshore options want longer-term project commitments. Based on the project’s needs, your potential talent pool could be less with onshore outsourcing.

What is Nearshore Outsourcing?

Nearshore outsourcing encompasses talent whose location is physically near the country where the main business resides. For example, if your company was based in the United States, a nearshore outsourcing option would be Canada, Mexico, or El Salvador. A bonus with El Salvador is that the US Dollar is the national currency, so payment conversion issues are eliminated.

Why Choose Nearshore Outsourcing?

As with any project, you should expect some hiccups. A major advantage of nearshore outsourcing is the proximity to your main location. If an issue arises that requires you to physically be there, a plane trip is just a few short hours away. Shared time zones are another chef’s kiss of choosing nearshore. Potential issues related to reaction times to projects and communication needs will be greatly reduced compared to the fully offshore option.

What is Offshore Outsourcing?

Offshore outsourcing is typically located someplace else in the world from you and your business. Hot spots for offshore outsourcing are India, the Philippines, South America, and Eastern Europe, just to name a few. Offshore outsourcing options have increased from manufacturing to the entire spectrum of business processes.

Why Choose Offshore Outsourcing?

Offshore outsourcing is traditionally used for large projects for extended periods. Since offshore outsourcing is familiar, these places have established operations and deeply skilled workers to do virtually any job needed. According to Outsource Accelerator, a Filipino software developer with skills comparable to a US-based programmer’s will cost just 10 percent of their US counterpart. Offshore outsourcing can also be a massive windfall for physical production costs. Your overall costs will be significantly lower than the onshore option.

What Business Benefits Come from Onshore vs. Nearshore vs. Offshore Outsourcing?

The children’s story “Goldilocks and the Three Bears” comes to mind when thinking about onshore vs. nearshore vs. offshore outsourcing. You have three options, and all have their pros and cons, but when it comes down to it, nearshore outsourcing will, in most instances, be the best solution for you. It is not too far, which lengthens resolution times, and not too close, which raises the cost of the work being done. Nearshore is just right.

Here are more details as to why nearshore is a great choice: You get personnel relatively close in proximity, language and cultural issues are reduced, and, best of all, skilled workers for a more reasonable price than the onshore option.

Regardless of which option, onshore vs. nearshore vs. offshore, is right for you, the point is that you have a choice. The best part is that you get a staffing company well-versed in local talent, which lessens the load of having to find someone remotely.

OSI is Your Perfect Nearshore Option for Your Outsourcing Needs

Outsourcing has gone mainstream. Whether onshore vs. nearshore vs. offshore, don’t let your business struggle to find what it needs and when it needs it. If you are considering nearshore outsourcing, OSI services include a wide range of vocations, including IT, Accounting, Operations, and more!

Contact us today!