Offshoring Explained: How Your Business Can Profit

Offshoring Explained: How Your Business Can Profit

02 Aug 2024
Intro

Offshoring can be a practical business solution when it’s done properly, as Hunt & Hawk has proved for more than a decade.

Whisper it quietly, but offshoring doesn’t have to be a dirty word.

Sure, some businesses exploit the practice. How many times have you dialled a phone helpline only to be connected straight to an offshore call centre?

But spending a little bit of time and effort getting to get your offshoring right from the start can save you plenty of heartache in the long run.

That’s certainly been the case for Hunt & Hawk, whose two longest-serving employees have been based in Manila since day one.

It’s a set-up that has benefitted all concerned, but one co-founders Ryan Devlin and Sonya Vanjicki admit required some forward thinking on their part.

What is Offshoring?

First things first, what is offshoring and how does it differ from outsourcing?

Offshoring is simply the process of having one element of the business – in Hunt & Hawk’s case, two of the company’s team members – based in another country.

It differs from outsourcing in the sense that the latter entails delegating certain business functions – for example, those aforementioned call centre helplines – to a third-party provider.

Hunt & Hawk could actually be classified as an outsourcer, because businesses outsource their branding, sales, and marketing to us,” Devlin explained.

“But we’re also involved in offshoring, because Tin and Jen are both based in Manila and it’s been our responsibility to train them and ensure they’re fully integrated within the business.”

How Did We Get Started?

Hunt & Hawk’s offshoring experience began before the company was even founded, when Vanjicki took a trip to The Philippines to explore some Business Process Outsourcing (BPO) opportunities as part of her duties as Global Marketing Director for Panalitix.

It was on this trip that she first met the firm’s long-serving Client Success Manager, Jennelyn – who went on to become Hunt & Hawk’s very first employee. Along with long-standing Marketing Team Lead, Tin, the pair have been ever-present on the company’s Zoom calls and Slack channels since Hunt & Hawk ramped up its offerings in 2020.

“It was never a case of us thinking: what can we offshore?” Vanjicki explained.

“We’ve always been big believers in the idea that you can hire anyone, in any location, and they can do a job for you.”

It’s an ethos that has seen both Jen and Tin play important roles in the growth of the business.

“The fact of the matter is that Jen and Tin both possess skills we didn’t necessarily already possess in house,” Devlin explained.

“If you’re a business struggling to attract talent and you’ve exhausted all your avenues in Brisbane, Sydney, and Melbourne… looking for offshore employees in places like The Philippines makes a lot of sense.”

Ryan Devlin

The Benefits of Offshoring 

So why do businesses choose to offshore in the first place?

Perhaps the most obvious benefit is simply the opportunity to reduce overheads and costs.

With service-based industries now comprising up to 60% of The Philippines gross domestic product, the nation is well-equipped to provide a range of services to foreign firms at significantly lower costs than can be found elsewhere.Yet it’s not the only reason Hunt & Hawk has benefited from hiring staff based in Manila.

“The time zone is one of the best things about offshoring in The Philippines,” Vanjicki said of the two-hour difference between the Brisbane office and Manila.

“But beyond other things like the shared language and strong work ethic, there’s also just the loyalty Tin and Jen have shown us,” she added.“We’ve built up so much rapport and trust with them over the years, and that’s really important from a business perspective because it takes a lot of time and effort to train new members of staff.”

What Else Should You Consider?

For businesses interested in offshoring, there are a number of other factors to consider beyond the obvious elements of cost and personnel.

Striking the right balance is key – particularly for any business considering offshoring the bulk of their services.

“One of our old accounting firm clients had a business in Melbourne, but it was only him located in the local office,” Devlin explained.

“All of his staff were offshore, which meant he had to be on every client call and in every meeting,” he added.

Working with the right BPO – and understanding their limitations – is another key factor.

“The most common way to start offshoring is just to engage a recognised BPO,” Devlin said.

“They manage the recruitment, they take care of all the employment laws, they manage all the technology and provide the office space your recruits work out of. You essentially pay them a ‘seat fee’ on top of the recruit’s salary for all of that.”

It’s a well-worn path for many businesses who have offshored overseas, but one that has its own pitfalls.

“You can scale up quickly when you sign up with one of these BPOs, but often the office spaces your recruits are working out of look pretty different in reality to the photos they show you in all the glossy brochures,” Devlin explained.

For businesses looking to scale to more than 20 employees, it often makes more financial sense to rent your own office space and then recruit your own offshore team.

That generally means you’ll need to send someone over from your business to oversee the set-up, but it gives you much greater oversight over the entire process.

Our Own Offshoring Definition

If you get your offshoring right from the outset, you may ultimately find there’s a third path you can take – and it’s the path Hunt & Hawk has taken.

With Jen and Tin having proved themselves invaluable resources, they have long been fully fledged Hunt & Hawk employees – with the business taking charge of all their relevant training, tax, and technology requirements.

What started as a fairly typical BPO process has transformed into a genuine offshoring success story – and one Hunt & Hawk is proud to highlight. 

Offshoring doesn’t have to be a dirty word.

When it’s done right, it can help drive your business forward and ultimately take you higher.

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