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The Advantages of Offshore Outsourcing to the Philippines

October 10, 2024
Theatre 4 LA

Since the advent of the internet, there has been a progressively exponential growth of the business process outsourcing industry which predominantly started in India in the early 1990s. This growth was further heightened with the development of online systems, SaaS platforms, and other cloud platforms that can essentially be accessed anywhere in the world with an internet connection. This prompted first world countries that have significant issues with hiring manpower in-house to look elsewhere for more cost-effective solutions, that not only hire the manpower resources needed, but also, help manage part of their operations that’s not a core function of their business. In this day and age of very specializing industries, the focus has been to be better at what you do best and outsource those that are more straight-forward tasks that can be outsourced. This is where companies can be very successful. 


The Philippine Offshore industry has been the fastest growing industry in the Philippines which now directly employ more than 1.7M direct employees and more than 4M people employed by auxiliary industries such as real estate, fast food chains, convenience stores , etc. The total revenues generated by the industry alone have surpassed $35.5B dollar in 2023 and is currently the second largest dollar generating industry for the Philippines, second only to dollar remittances from oversees workers. 


There’s a lot of reasons why the Philippines has been considered worldwide as the number #1 contact center outsourcing destination in the world, and is second only to India as the offshore outsourcing destination for all verticals. The primary reason the Philippines is number #1 is because of our cultural affinity to the western world, and, our adeptness in the English language. However, the Philippines also has been increasing its competencies and capabilities, veering away from simply just being in the call center industry, but, the country is also becoming a powerhouse in knowledge process outsourcing work that require more specialized skillset in the legal, medical and financial sectors, to name a few. 


North America accounts for roughly 70% of the offshore buyer’s market for the Philippines offshoring industry because there has already been a proven track record of success in North America.


In the past, Fortune 500~1000 companies were the first players in the offshoring outsourcing industry, however, even before the onset of Covid-19, and more so, after Covid-19, Small-to-medium sized business have started to realize that a lot of processes in their existing companies can be more economically and more efficiently outsourced to third party companies. But, if they can be outsourced to onshore third-party companies, why not offshore to third world countries such as the Philippines to maximize the benefit?


The challenge for Small-to-Medium sized companies that don’t have networks outside of North America is in selecting the right offshoring partner for your business. The seminar will highlight all the key factors that needs to be taken into consideration when outsourcing offshore successfully. 


Fred Chua, CEO - Magellan Solutions Outsourcing, Inc.

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