Near-Shore vs. Off-Shore: Which is Right for Your Business?

As a contact center professional, you’re probably already aware of one of the hottest topics in the contact center space today: the question of outsourcing near-shore vs. off-shore contact center operations. Near-shore outsourcing refers to hiring a company located in a country – and time zone – close to your own. If you’re based in the United States, near-shore can include Canada, Mexico and Central America. Near-shore employees usually speak English as a first or second language and have a reasonable understanding of the U.S. culture. Call centers in higher cost, developed countries are often ideal for:

• Sales or lead generation with a finite database
• Higher value inbound support
• Low volume inbound or outbound
• Functions that involve higher margin products/services

Off-shore outsourcing companies, in contrast, are located on the other side of the world – and in far-away time zones. Off-shore companies are usually located in India, the Philippines and Eastern Europe and are often ideal for:

• Consumer lead generation or sales with very large targets/lists
• High volume / low level multi – channel customer support
• Back-office functions like transcription, chat, and online research
• Functions that involve low margin products/services

 Near- and Off-shore Pros
While the primary objective for using a near-shore or off-shore contact center is the cost savings – labor and overhead can be significantly less – there are other benefits, as well:

• Outsourced service providers usually manage employee recruitment and training, which means you save on HR costs, as well as the time you would spend on these tasks.
• The contact centers can usually handle 24/7/365 customer service, often at a fraction of the price of on-shore options. This provides you the ability to confidently meet your customer demand.
• You can increase business continuity if your provider guarantees 100 percent uptime, has servers located in multiple geographic locations and a dedicated team to ensure call quality.
• Many near-shore providers offer the availability of college-educated agents, as well as multilingual services.
• Proponents believe that contact center agents at near- and off-shore centers value their jobs more than those in the United States, and therefore there is less agent turnover and higher performance.

 Near- and Off-shore Cons
Despite the costs savings, there can be downsides to working with off- or near-shore contact centers: Voice quality concerns — language barrier, communication and cultural differences.

• Time zones can hinder check-in calls.
• Agents may have accents.
• Cultural differences can come across as rudeness or being cold.
• It can be harder to evaluate a company from so far away.
• Data security can be questionable.
• Geopolitical concerns may exist (government policies, unstable political leaders, terrorism, etc.).
• Some consumers can be turned off by companies who they view as sending jobs outside of the the United States.

 Making the Right Decision
Proven near-shore and off-shore contact centers can reduce outsourcing costs by 30 to 50 percent, compared to U.S. vendors. However, price alone should not drive your decision. Make sure the vendor you choose has a proven track record of working with companies like yours. If your costs are lower but your vendors underperform, it defeats the purpose of outsourcing.

Finding the best possible contact center provider – regardless of where it is located – is vitally important to the success of your business. While outsourcing to near- or off-shore vendors isn’t right for every company, it may be worth your consideration. When evaluating these vendors, your due diligence is critical, and it can be overwhelming. CHCG has helped many companies determine which option is the best fit for their particular needs and long-term goals. If you are considering hiring a near- or off-shore contact center vendor, I encourage you to please contact me directly to discuss your options.