Nearshoring is an outsourcing model where a business sends tasks to a third party firm operating in a neighboring country. From the name itself, you can tell that this model highly considers the proximity of the outsourcing destination to harness the location’s lingual, geographical, and cultural advantages.

Benefits of nearshoring

Most businesses resort to nearshoring to benefit from the destination’s affinity with the source country, and not mainly to save travel and communication costs.

Let’s say you’re a company based in Argentina that caters to Spanish-speaking customers across South America. You want to engage with your consumers better through phone-based customer service, but you don t find your local labor force fit for the services you want to carry out. You may consider outsourcing to a South Asian location, but you’re afraid that the people there won’t be able to connect with your Latin American market. What should you do then? Find a neighbor country whose workforce also speaks your language and lives your culture, perhaps Costa Rica or Chile.

If your business’ main concern is quality monitoring and accessibility of the outsourced services, your answer still lies in nearshoring. Some tasks, particularly those in the production industry, need to be closely supervised for quality assurance, so overseas operation may not be the best choice. In cases like this, it would be more ideal to farm out to a nation that’s just a border away from your headquarters. This way, you can travel between two locations or communicate with your outsourced staff with greater ease at lower costs.

Where to nearshore?

In determining the right nearshore destination, you should first list down what you need from an outsourcing firm and what your choices can offer you.

If you don t want time zones to cause conflict between your staff’s availability and your customers’ needs, then operate in a zone where your market concentrates. And if you want to have a central location instead of setting up various offices across different regions, then outsource to a geographically accessible multilingual call center that delivers voice services in the languages that your consumers speak.

As with any type of outsourcing venture, there are many important things to consider before you enter a nearshoring deal. Take a closer look at your prospects to ensure that they would not just bridge geographic distances but the quality, language, and culture gaps as well.