Today, businesses have a lot on their plate. It’s challenging enough to provide excellent products and services, maintain standing, and continue development. But now, they must also consider expanding and improving their services without going over budget and compromising quality.
These challenges made business process outsourcing (BPO) increasingly prominent. The strategy involves delegating specific non-core functions to third-party service providers, allowing in-house teams to focus on tasks intended for company growth, such as business development and crisis management. Third-party providers also help reduce operational costs and provide access to specialised expertise.
Selecting an outsourcing destination requires various considerations like cost-effectiveness, availability of skilled talent, language proficiency, cultural alignment, and more. This choice can significantly impact the success of your endeavours. Read on for an up-to-date analysis of the best outsourcing countries worldwide so you can make informed decisions for your BPO needs.
Top Outsourcing Countries in the Global BPO Sector
Gain insights into the world of BPO countries and discover the key players in the industry.
1. India
The world increasingly demands work from industries like IT, software development, and accounting. India excels as the largest BPO country in the world for software development outsourcing, boasting a highly specialised workforce and a thriving technology landscape. Revenue for IT outsourcing in 2023 was at US $8.81 billion.
With a large pool of skilled software and technology experts, India offers cost-effective labour fuelled by a strong emphasis on STEM education. Its status as a large English-speaking nation ensures a wide range of tech specialists, including those in application development, machine learning, and artificial intelligence.
2. China
China’s service outsourcing industry saw steady expansion in the first seven months of 2023. During this period, Chinese firms undertook service outsourcing contracts worth US $175 billion, up 15.5% year-on-year.
One of the benefits of BPO in China is the low labour costs, with an average monthly wage below that of Western nations. The country’s robust manufacturing sector accounts for 28.7% of global output, allowing companies to access products economically and evade import tariffs.
Additionally, China’s strategic location to the growing South and Southeast Asian countries provides easy access to lucrative markets, with its thriving startup culture offering innovation and agility.
3. Malaysia
Malaysia is a rising star in the outsourcing industry, expecting to maintain a 3.1% compounded annual growth rate (CAGR) over the 2019–2024 period. IT and software development are among the most outsourced here.
Two key reasons make Malaysia an appealing outsourcing destination. First, Malaysians exhibit impressive English proficiency, ranking third in the English Proficiency Index for Asian countries in 2021. Second, Malaysia’s cost of living is lower than many American and European cities, a financial advantage for expanding companies.
For example, the average income in Malaysia as of May 2023 is approximately US $1,485 per month, which is significantly less expensive than in other wealthy nations.
4. Brazil
Brazil is an excellent choice for outsourcing thanks to its skilled workforce, cutting-edge facilities, and cost-efficiency. It has established robust network and telecommunication systems, outperforming many countries that outsource IT services. Moreover, favourable 2017 outsourcing regulations enabled businesses to outsource core and non-core functions, offering flexibility in talent acquisition.
Labour costs in Brazil are approximately 20% lower than in the United States, with reduced operational expenses and worker turnover. The country is also known for its BPO and software development, hence why major companies like Accenture, IBM, and HP actively seek offshore IT services in Brazil.
5. United Kingdom
The UK BPO industry is anticipated to generate US $24.04 billion in revenue in 2023 and a CAGR of 3.58% between 2023 and 2028. Beyond cost, productivity and efficiency are frequently the most essential aspects of any project, making the country one of the most dependable locations for outsourcing.
The country also offers a vast pool of expertise-oriented IT service providers, strong government support, and a strategic geographic location that minimises friction between businesses and lags from time differences, allowing efficient communication and project coordination.
The UK’s investment in technical talent underlines its competitiveness, as it is now a growing technology hub with cost benefits and high-quality solutions. Native English speakers also enhance communication quality, and UK-based companies drive efficiency.
6. Philippines
There has been a great deal of cultural adaptation in the Philippines due to American colonisation, especially in language. Over 92% of Filipinos are fluent in English, making the Philippines one of the countries with the most significant English-speaking populations worldwide.
Experts estimated the BPO industry to produce US $38.9 billion in revenue after 2022. As a significant force in the global BPO industry, investors continue to have faith as the country has seen a boom in the freelancing and ecommerce sectors.
In 2022, it emerged as the fastest-growing ecommerce market, with 1.5 million Filipinos registered in international online platforms for freelancing services and a 24.1% market share, enhancing its standing as a premier outsourcing hub. A few common outsourcing services include virtual assistance, graphic design, content creation, site design and development, and customer support.
Major BPO Countries on the Rise Today
Various countries are making a statement on the global BPO scene. Explore the unique strengths and advantages that position these nations at the forefront of the sector.
1. Vietnam
A contender in the outsourcing industry, particularly in IT, is Vietnam. The country has a projected growth of 13.47% by 2027. Vietnam’s attractiveness lies in its affordability and a rich pool of tech talent, making it a go-to destination for cost-effective solutions and flexible team management.
However, there are important factors to weigh. Language proficiency in Vietnam has improved but still lags behind other outsourcing countries. Moreover, the absence of a national data protection law poses challenges in the BPO industry for businesses seeking data privacy compliance.
2. Mexico
Mexico is gaining recognition as a burgeoning BPO destination focusing on HR and IT services. Revenue is expected to blow up to US $3.89 billion in 2023. Its strategic geographic proximity to the United States provides logistical advantages, making real-time collaboration more feasible.
While all these sound amazing for the country, it can still improve its English proficiency and build stronger data privacy regulations. Better language skills can attract more global businesses, while data protection laws can safeguard intellectual properties and customer data, increasing trust and competitiveness in the market.
3. Singapore
Known as the Lion City, Singapore is a thriving hub in the globalised economy, offering economic stability and growth opportunities. The country boasts of a highly supportive government that simplifies business policies, provides financial assistance, and facilitates technological access for foreign companies.
Despite challenges like rising labour costs, the nation is still on the move to becoming a global IT leader. To counter high labor costs, the country encourages local outsourcing by offering incentives to foreign businesses, like an enticing corporate tax rate of 17%, and expanding the multilingual talent pool.
4. Germany
Germany is an enticing outsourcing destination thanks to its progressive culture, excellent transit infrastructure, and stable rental market. Research and development enrich its skilled workforce, further enhancing its appeal. Its time zone also facilitates alignment with global locations.
However, Germany can improve its outsourcing sector by simplifying business regulations and incentives, as the country is known for its detailed and complex system. Enhancing English proficiency among the workforce can also attract global companies.
5. Bangladesh
Bangladesh’s outsourcing sector is thriving, attracting interest from developed countries such as the USA, the UK, Canada, Australia, and Singapore. With over 40,000 IT freelancers in Bangladesh, competitive pricing, quality, and a growing pool of expertise have driven interest in the country.
Key factors supporting Bangladesh’s rise in outsourcing are its young workforce, cost-effectiveness, and government incentives for the IT sector. Additionally, the country’s growing digital infrastructure ensures top-notch service quality, making it a preferred destination for outsourcing.
Bangladesh’s pro-business policies and government initiatives, such as tax incentives, special economic zones, and simplified procedures for company registration, create a favourable outsourcing environment.
Continuous infrastructure and digital connectivity improvements can help the country ensure faster and more reliable services. Developing language skills among its workforce, particularly in English, can attract more international clients.
Meet Tomorrow’s Outsourcing Leaders Today
Staying competitive is a complex challenge for any business. Thankfully, countries worldwide offer strategic solutions for companies to optimise and scale their operations, reduce costs, and tap into a global talent pool.
From the cost-effective solutions of India and the proximity and bilingual capabilities of the Philippines to the growth potential in Vietnam and the robust technological infrastructure in Bangladesh, each country offers distinct advantages, curating each of its offerings to specific needs and preferences.
At Select VoiceCom, you can acquire BPO services in the Philippines, ensuring you get expert assistance from one of the world’s leading outsourcing countries. With experience, a talented workforce, and a commitment to exceptional service, Select VoiceCom can cater to your business needs.
Whether you seek customer support, technical expertise, or back-office assistance, we can be your reliable partner on the path to success. Contact Select VoiceCom today to explore how our outsourcing solutions can elevate your business performance.