Onshoring is a type of outsourcing deal between two companies that operate in the same country. Just like nearshoring, businesses that send out services to a local provider benefit from the location’s language and culture.
Advantages of onshoring
Businesses that outsource locally are able to save travel and communication costs that commonly come with setting up overseas operations and training foreign staff to meet your company’s demands. When you outsource to a foreign location, you would have to undergo long travels for site visits. With onshoring, this can be minimized.
Aside from that, you get to closely monitor outsourced operations to assure that they are done according to your standards. Onshoring works best for those in the manufacturing industry where the quality of products made in every production site should be consistent.
Having a customer service team who speaks the same language as your customers and thinks along the cultural mindset of your market could bridge the gap between your brand and your customers. This solves the communication problem that may arise between you and your outsourced staff in another continent. There, you may have a hard time relaying orders, or worse, you may not engage with your customers efficiently.
Moreover, you won’t have a problem with conflicting customer demands and staff availability, as both your market and team are located in the same time zone.
Onshore outsourcing indeed lets you save travel and communication costs, as well as bridge the lingual and cultural gap between you and your market. Communication and time conflicts can also be lessened because of the geographic benefits brought by this outsourcing model.
Onshoring, however, may not be ideal for every business. Sure, it lowers costs, but the savings may not appease for the trouble you might go through to find a local third party firm with high service quality at affordable rates.
You should still consider the expertise you can get from the outsourcing destination and the overall cost efficiency of this venture. Before settling for a provider based solely on the proximity they offer, consider what you might sacrifice just to get a small saving from the lowered travel costs.