Outsourcing in the Philippines to Achieve Great Labor Cost Reduction

Scene 1: You’ve already been counting years in the business. You produce good quality products or services. You hired so many employees in every task required to run your company. And sometimes, certain works have two or more employees because you think that the more employees, the faster jobs are done and the better the outcome. But every time you set meetings with your sales and marketing departments, your profits are not that impressive.

Scene 2: You are just starting up your business. You already have a business plan. But you are hesitant about how many staff you should hire due to the limited budget.

An established company that failed to expand to other operations because the ROI is not increasing and with less output despite many staff; and a startup marketer that couldn’t step into the next level because they can’t afford to over budget. One is overspending on the labor cost, and the other is wanting to cut costs for labor expenses. Two different dilemmas but only one solution– and that is outsourcing.

Outsourcing customer service in the Philippines is the primary antidote for the expensive labor cost that many companies from other countries are experiencing. The number of international companies that choose to outsource in this small country in Southeast Asia is astoundingly increasing after they proved how effective it is for labor cost reduction. There is an unimaginable 70% you can save when hiring Filipino workers who have the same education, skills, and expertise as workers from western countries whose salaries are 70% or higher! The basic salary rate in the Philippines ranges from 874.21 US dollars up to 620.97 USD, depending on the position, experience, and academic requirements. These figures are quite low compared to the basic salaries in the US, UK, and other western countries.

For instance, if you want to outsource customer support in the Philippines, the standard rate for a customer service agent is 1.64 US dollars per hour. Your company can achieve a massive saving for labor expenses rather than paying 70% or more expensive salaries from customer service agents in the developed nations. Another is the average yearly remuneration of software developers in the Philippines amounts to almost 8,000 USD. It is a cheaper salary rate compared to their US and UK counterparts that receive around 70,000 USD and 42,000 USD respectively. There is a glaring fact that the outsourced software developers in the Philippines received 80% less for doing the same task.

What could be the reason behind this fact?

One factor is that the Philippines has a low cost of living among its neighboring countries in Asia. The majority of the Filipinos are satisfied to live humbly. Although not all, many citizens could survive and were content to have three meals a day. Filipinos tend to “tighten the belt” in times of crisis and budget shortage.

Furthermore, the commodities in the Philippines are cheaper compared to the developed nations. There are only a few Filipinos who spend beyond their means. Those who earn 800 USD and up are already thankful to receive such an amount of salaries. The outcome is, they love and keep their job seriously.

So, if you want to achieve labor cost reduction for your business, outsource customer service in the Philippines and look for the best partner.