Understanding Onshore Outsourcing

Onshore outsourcing enables businesses to farm-out the work they don't want to do in-house to other companies within the same country. When many people think of outsourcing, they imagine work done overseas — onshoring turns that idea on its head and leverages local talent.

Learn about onshore outsourcing and some of its benefits for your business:

What Is Onshore Outsourcing?

Onshore outsourcing allows organizations to achieve the benefits of outsourcing while also having the work done by another company located in the same country. It's different from offshore outsourcing, which in some popular contexts became synonymous with outsourcing — offshore outsourcing takes the work to another country altogether.

Outsourcing itself simply refers to having the work done by an outside company instead of in-house. The other company has a contract to get the work done and typically is asked to meet certain standards provided by the company that is outsourcing.

How Does Onshore Outsourcing Work?

Typically, something similar to the following process is used whenever a company outsources work:

  • Choosing a contractor: The company first decides to begin outsourcing a task, the work of an entire department, or a single project area. From there, a contractor — an individual or a corporation — is chosen.
  • Drawing a contract: A contract is created to govern the relationship and detail the responsibilities and standards of both parties for getting the work done and providing appropriate compensation.
  • Planning work: There is often an implementation phase with any long-term outsourcing arrangement where the contractor learns more about the hiring company's expectations and needs. The organizations work together to plan out any project before work begins.
  • Beginning the project: Starting the project after planning provides both businesses with an opportunity to evaluate the relationship and make sure it's a win-win for everyone.
  • Ongoing communication: Healthy two-way communication and concrete expectations can help ensure that both sides are on the same page.
  • Renegotiation: If any new needs come up, the two parties may renegotiate their contract. This can also occur if significant changes happen in the market, pricing changes occur, materials are changed, or another significant adjustment is made.

Companies can skip around with these steps, leave a few out, or follow a different order as they forge partnerships and negotiate terms. Any changes that happen can result in adjustments to the contract, delivery or work schedule, or other terms.

A large organization may have a significant number of ongoing contracts with different suppliers. Just one business, in other words, could outsource to hundreds of smaller companies. For large enterprises, this is often the case, and many companies maintain ongoing relationships even for single functions and operational areas.

Benefits of Onshore Outsourcing for Businesses

Organizations have a lot to gain from onshore outsourcing. They can achieve reduced costs, improved outcomes, and protect their intellectual property. Some of the main benefits of onshore outsourcing include:

  • Reducing costs: Cut expenses associated with business operations
  • Protecting intellectual property: Many countries overseas aren't protecting intellectual property as strongly, making onshore outsourcing an appealing alternative for those looking to protect their IP rights.
  • Expert work: If particular work takes away your focus from your core business, it may make more sense to have another business tackle it for you, especially if they are experts in the field.
  • Leveraging available talent: Not every region has equally-skilled talent for hire in every field. Onshoring allows you to take advantage of nearby talent instead of hoping to somehow find the right people elsewhere.

Getting Started with Onshore Outsourcing

For businesses considering outsourcing, onshoring has a lot to offer. Organizations can form contractual arrangements with businesses that can complete the work within the same country. This can provide tangible benefits and savings for the contracting organization.

Your business has enough on its plate. Outsource what makes sense for your business, choose a world class SaaS technology solution and focus on what's important: your clients. Call 1-866-879-8647 or fill out an online form to request a no-obligation quote from an 8x8 product specialist.

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