When a business is choosing which company to outsource with, location can often be overlooked in favour of the most appropriate specialist for the project. However, location – and especially proximity - should be a critical part of the decision process. For example, if your company is based in Europe, it will be more difficult to outsource from a provider based in Asia, due to a mixture of time, travel, language, and perhaps cultural differences. To ease this dilemma, nearshoring offers greater potential in outsourcing because it has the strongest collaboration opportunities for a number of additional reasons.
The key benefits of nearshoring are the shared time zones and ease of travel to meet your outsourcing partner. The further apart the companies are, the more expensive flights will be, and with the added flight time, more work time will be hindered. In addition, the working hours of the two companies based nearshore will be similar, so if a problem occurs, the teams can organise an immediate call to fix the problem. Alongside this, if both companies have working hours that are either within the exact same time zone, or very similar, weekly meetings can also be secured easily, as opposed to one party having to use time in their early morning or evening.
On top of this, you’re far more likely to be aware of—and share—the national holidays of your nearshoring partner, and will consequently be aware of which working days your outsourced partner won’t be present in their office. With these dates in mind, project deadlines can be calculated accordingly. If a country has a national holiday shortly before a deadline, you will be able to adapt the workload accordingly, rather than find out about the holiday last minute.
The work culture of each country also impacts how companies communicate with each other. For example, misreading a message can have disastrous consequences if interpreted incorrectly, affecting both the direction and development of your partnership. The same applies to languages. If both company representatives share the same language, or at least share knowledge of a language, then the two companies can work much easier. This is far more likely to happen in regions where one language is commonly used amongst neighbouring countries.
And yet, other benefits to nearshoring, such as the company having a greater understanding of the country’s changes in legislation and law, are more often ignored. For example, companies based in the EU, or with customers in the EU that store customer data will be impacted by the incoming General Data Protection Regulation (GDPR) legislation, but an outsourcing partner in Asia may not be aware of this new legislation. By nearshoring, the businesses will be aware of changing legislations or laws, and can consequently understand new processes that the company needs to undertake.
Shared culture and location are undoubtedly the biggest advantages to nearshoring. With smoother and more efficient communication and date planning comes a product that is created quicker and with greater quality, with a higher chance of having as little miscommunication dilemmas along the way as possible.