onshore offshore nearshore call centers

Smartshoring: onshore, offshore, nearshore, and more

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Location, location, location. 

It’s certainly key for your business, but does it matter for your call center? There are a number of various location-based models for call centers, and which is right for you depends on a number of factors. 

Of course, an in-house call center model keeps your call center literally within your own team. But most businesses and brands are better served by an outsourced call center, where a dedicated team of customer service experts manages the hiring, training, services and data analytics of the call center. 

When outsourcing a call center, you have many location options, from onshore (in the same country as your business) to offshore (in a country that’s generally far away from your business), as well as other options in between. 

Which should you choose? That depends on a variety of factors: from cost, to the amount of complexity and flexibility you need from a call center, to your company culture, your audience, and more. 

From offshore, onshore, nearshore and more, the differences between each type of call center can be confusing. Keep reading to learn the types of call center models, the differences between them, and which is right for your business.

What is onshore?

An onshore call center is an outsourced call center that is still located within the same country as the business it’s servicing. It does not necessarily need to be located in the same time zone. For example, a business in Nevada may have an outsourced onshore call center in Chicago. 

Onshore call centers come with a lot of benefits, such as familiarity with your audience, fewer language barriers and more overlap between time zones. However, it’s not the perfect fit for every business.

Onshore call centers pros

Let’s consider some of the benefits of onshore call centers:

Benefits of Onshore Call Centers
Little to no concerns about language or cultural barriers
Familiarity with your audience and cultural or geographic concerns
More time zones overlap
Easier travel, if needed, for training
Possibly more familiar and compliant with US data laws, regulations, laws and security concerns.
Let’s consider some of the benefits of onshore call centers: However, there are possible downsides to consider. The biggest drawback to onshore call centers is simply that it costs more on all fronts—from hiring in the US to overhead costs of technology, equipment and working space. An onshore call center will no doubt be a bigger expense than an offshore or nearshore call center. Onshore call centers may require in-office spaces in the US, or they may be a hybrid work-from-home and in-office combination model. However, for some companies, this expense is justifiable. Clearly, onshore call centers come with some major benefits. Onshore call centers are often more efficient and provide higher customer satisfaction, because the lack of language or cultural barriers means customers feel better understood and more connected to your brand. In addition, call center teams who share the same language and culture with your target audience often have reduced handle times and increased first-contact resolutions, improving customer experience and satisfaction.

Is an onshore call center right for you?

Onshore call centers are undoubtedly more expensive than outsourcing offshore, however, onshore call centers tend to offer better customer experiences and satisfaction, due to familiarity with the language and culture of your customers. 

As a result, onshore call centers can be a great solution for companies who: 

  • require close proximity or a lot of control over their BPO resources
  • need legal jurisdiction for BPO resources 
  • have an audience or product that is sensitive to linguistic or cultural barriers 
  • don’t require a lot of call center resources or services
  • can manage their customer needs with a smaller team (thus reducing costs) 
  • require cultural or linguistic fluency for exceptional customer service 

In short, companies who have the budget for it should consider the benefits of an onshore call center on customer satisfaction and experience, and consider it an investment in their ongoing growth.

What is offshore?

An offshore call center is an outsourced call center that is located in a different country as the given business. This is generally somewhere quite far from the country of business, often in Southeast Asia. For example, a company in the US may have an offshore call center in India or the Philippines. 

Offshore call centers can have some drawbacks, but they can also have a lot of benefits. For companies who are just getting started with an outsourced call center solution, offshore call centers can provide a low-cost way to provide customer service at scale.

Offshore call center pros and cons

Let’s take a closer look at some of the benefits and drawbacks of offshore call centers:

Benefits of Offshore Call Centers Drawbacks of Offshore Call Centers
Low cost of operations Cultural and language barriers can cause frustration
High number of jobs and workers available for large-scale operations Higher level of trust needed since proximity means you’ll have less control
Easy to schedule overnight shifts for a US market to provide 24/7 service Potentiality for lack of brand awareness or mismatched brand values
Many offshore call center agents are multilingual Possible data privacy issues
Wider range of services offered, or wider range of affordable services

As you can see, offshore call centers come with a wide range of benefits.

One of the main benefits of an offshore call center is simply the low cost—it provides a low barrier to entry for new companies who need an outsourced call center, and the competitive call center market in other countries means there’s lots of flexibility.

In addition, there’s a large number of available employees for call center jobs in other countries, making a large-scale call center operation possible and affordable with an offshore call center.

On the other hand, offshore call center agents often do not speak English as their first language, meaning there can be linguistic or cultural barriers that can cause frustration for the customer. In addition, it often means call handle time is higher, due to language barriers.

However, for companies who have a global presence, offshore call center agents are typically bilingual or multilingual, and thus able to provide support for a variety of global audiences.

Is an offshore call center right for you?

While offshore call centers often offer more affordability and more services, you know your customer needs and preferences best. Will an offshore call center solution be the best fit for meeting your goals on your current budget? 

Offshore call centers can be a great solution for companies who: 

  • need very large-scale operations
  • have smaller budgets and want a more affordable call center solution 
  • would prefer to have more services at a lower cost
  • don’t need much proximity or control over their outsourced call center
  • require multilingual customer service for global brands
  • are less concerned about linguistic or cultural barriers 

 

Consider what services and solutions you’ll need, and the benefit of getting those services at an affordable cost vs. having fewer services with local agents with an onshore solution.

What is nearshore?

A nearshore call center is an outsourced call center that is located in a different country as the given business, but one that is nearby (as opposed to an offshore call center, which is most typically located in Southeast Asia.) 

For example, for US-based businesses, nearshore call centers may be located in Canada, Puerto Rico, Mexico or similar places. They may or may not be located in the same time zones as the business.

Nearshore call centers can be a great balance between some of the benefits of onshore and offshore call centers.

Nearshore call center pros and cons

Here are some pros and cons to consider when deciding if a nearshore call center is right for you: 
Benefits of Nearshore Call Centers Drawbacks of Nearshore Call Centers
More cost-effective than onshore call centers Not as affordable as offshore call centers
Many agents may be bilingual in Spanish or French Fewer options for vendors and human resources; limited to specific geographic areas
More cultural and linguistic connection to US audiences, since many agents may have lived, worked or traveled in the US Some language barriers or cultural confusion may still be present
Similar time zones may make for easier communication
Higher level of control, if needed by your business, due to proximity
Nearshore call centers often strike a delicate balance between affordability and cultural and linguistic familiarity. With a nearshore call center, it’s likely that many of the employees have stronger cultural and linguistic connections to the US, likely having traveled, lived or worked in the US before. For countries like Canada and Puerto Rico, English is one of the official languages, so there will be a deeper level of native understanding of English, while still offering the benefit of bilingual agents to provide support in Spanish or French as well. For companies who are on a strict budget, but still want the benefits of cultural familiarity and higher-level English skills, a nearshore call center might be the best option. If travel to your call center is required or desired, nearshore call centers make this much easier for US-based employees and management.

What is homeshore?

A homeshare call center is an outsourced call center model where the call agents work remotely, or virtually. The call center agents will be located in the US (or wherever the business is located), but there is not a centralized call center office. 

This is sometimes known as a virtual call center. 

A virtual (or homeshore) call center allows you to be extremely cost-efficient (i.e., little to no overhead and office costs, no traveling to visit the center in person, etc.) while also hiring customer call agents who are located in your country. This reduces linguistic and cultural barriers and often allows you to provide better customer support.

Homeshore call centers pros and cons

Of course, as with any call center model, there are various pros and cons.

Benefits of a Homeshore Call Center Drawbacks of Homeshore Call Centers
Local benefits from hiring onshore call center agents Difficulty training and managing a completely remote call center
Flexibility and scalability with services and subscription packages—pay for what you need Possibility for more security issues
Improved customer experience through cloud-based omnichannel tools Staff development can be difficult; remote work can be isolating
Remote work is attractive to employees—widens pool of applicants and possible employees

One of the biggest benefits of a homeshore call center is being able to hire within your country. With agents working remotely, overhead and infrastructure costs are much lower than they otherwise would be. In addition, there’s often much more opportunity for flexibility and scalability, with the ability to pay for only what you need and scale up or down throughout the year.

Of course, you’ll need to be prepared for the challenges of a remote workforce. Training and managing a completely remote call center comes with unique challenges, and your call center management should be prepared to handle them, if you’re outsourcing.

In addition, productivity has the potential to increase or decrease with remote work. Many employees find they are more productive when working remotely. However, some may struggle, and it can be a challenge to monitor productivity and KPIs when not directly working with someone.

Your call center management, whether in-house or outsourced, should be experienced with remote work best practices and be able to train virtual agents on them.

Finally, security and IT becomes even more of a risk when working with homeshore call centers. With agents on personal devices or personal WiFi systems while also accessing sensitive consumer data, the risk of a security breach grows. Companies will need to take extra precautions to safeguard customer data.

Companies who need a high level of customer security and data privacy compliance (i.e. banking, financial institutions, healthcare) will want to carefully consider the preparation and security of any virtual call centers they are considering.

Is a homeshore call center right for you?

Despite some drawbacks, the benefits of a homeshore call center make the investment a no-brainer for many companies. You should consider homeshore call center options if you: 

  • already have a completely remote or distributed workforce
  • need to employ onshore call center agents on a limited budget
  • want increased flexibility and scalability options 
  • do not need to visit your call center in person for training or management

Onshore vs. offshore, nearshore and homeshore

So, which is right for you? 

Each company has its own call center needs, goals and budgets. The variety of factors discussed above, combined with your unique needs and goals, will determine which call center model makes the most sense for you. 

Onshore and homeshore call centers provide superior customer service and increased support, alongside fewer language or culture barriers. However, onshore call center models are typically the most expensive. Homeshore call centers can help reduce costs while still maintaining onshore support. 

Nearshore and offshore call center models are more cost-effective, but may increase the amount of language or cultural barriers, which may impede service, slow down handle time and decrease customer satisfaction. Nearshore call centers often provide a decent balance of cultural familiarity alongside more cost-effective rates. 

In addition, some goals are more suitable for certain models than others. 

If you’re looking for advanced technology, cloud-based systems and reporting and an omnichannel approach, an onshore or homeshore call center might be your best bet. 

For companies looking to outsource their call centers and provide consistent support, but with a limited budget, an offshore call center could be the way to go. 

For large companies who need large levels of support at scale, offshore call centers can be extremely competitive options. 

For companies whose goals include improving customer satisfaction and experience, an onshore call center might serve those goals better than other models. 

Regardless of which model you choose, remember that a customer support center is an investment in your overall business growth—customers who have a positive experience are more likely to purchase again, recommend your business online or via word-of-mouth, and become loyal customers. 

Still not sure which model is right for you? Talk to a customer support consultant at Global Response and we’ll help you determine the perfect call center match for your goals, needs and business.

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