Difference between Onshore and Offshore Outsourcing
The differences between onshore and offshore outsourcing are a bit confusing because they all have one common denominator; outsourcing. However, they are different in many other ways, and the knowledge of these differences would put you in a better position to know which of the two would fit your business needs.
Let’s look at the differences:
First, let us look at the definitions and how the two are differentiated by this factor.
Definition of onshore outsourcing:
Onshore outsourcing is where you work with a company that is located in your home country i.e. you source for external help but within your own country.
Definition of offshore outsourcing:
Offshore software development refers to the allocation of non-core business processes to a company in far-away countries i.e. you source for external help from foreign companies.
What is the difference?
From the two definitions, it is clear that the geographical boundary is the difference between onshore and offshore outsourcing where the former has geographical boundaries while the latter has no limits.
Pros and cons of onshore and offshore outsourcing
We will look at some factors and determine whether they are pros or cons of either of the two modes of outsourcing.
This is an advantage if you are using an onshore outsourcing method as you will be able to take advantage of the local companies with whom you can work swiftly.
Otherwise, it may be a disadvantage if you choose offshore because the company comes from a foreign country and there are many things that you don’t share, which may take you a lot of time and resources to explain.
This is a factor that is beneficial to both onshore and offshore outsourcing users. However, it depends on your country and the surrounding production factors such as wages. For example, if your country has cheap labor, you will find onshore outsourcing to be much cost-effective than if your country’s labor force is expensive.
Therefore, this factor solely depends on the nature of your country.
If you are looking for a way to internationalize your company, then offshore would offer you the best value as you will get companies with competent native speakers of the different languages that you want to add to your business.
But if you do not have the intention of using multiple languages in your business, then the language barrier becomes an issue in communicating between you and the offshore company you have outsourced the services to.
Well, the difference between onshore and offshore outsourcing has been highlighted and you just have to know which of the two really fit your business needs.
If you are unsure about the model that will fit your business well, kindly contact us and we will offer comprehensive guidance that will help your business grow well.