Outsourcing to the Philippines: How it can help SMEs scale

It’s well-documented how outsourcing to the Philippines has helped companies save on labour and operating costs, improve efficiency and productivity, and boost profits.

Philippines outsourcing can help SMEs scale

With a 20-year track record of outsourcing success, the Philippines has established itself as a global leader in business process outsourcing (BPO), says Ralf Ellspermann, CEO of PITON-Global, an award-winning outsourcing provider in the Philippines.

“BPO to the Philippines is not just advantageous for the heavy hitters of the business world. Startups and small-to-medium enterprises (SMEs) can also enjoy the same benefits,” he said.

"Outsourcing allows young companies to focus on their core business functions while saving on costs and expenses related to secondary business functions such as front and back-office operations.”

Here he explains how, as a result, the booming Philippine BPO industry continues to attract SMEs seeking to capitalise on growth opportunities.

Many founders of startups and owners of SMEs in the UK find that outsourcing to the Philippines helps them quickly scale their portfolio of products and services so they can become more competitive and profitable. Scalability makes business process outsourcing to the Philippines one of the most effective tools to scale businesses for maximum growth.

Obvious savings on costs

Saving money is the main reason companies outsource business processes to the Philippines. Outsourcing can reduce the cost of material expenditures such as office space, infrastructure, technology, and other equipment, as these become the BPO provider’s responsibility.

Companies also save on employee costs like salaries, health care, and other benefits. All in all, companies outsourcing to the Philippines can save up to 60% on labour and 40-50% on operating costs, savings that can go towards resources that will contribute to healthy and substantial growth.

Outsourcing frees up capital for growth

“Cutting costs is necessary for almost all SMEs, as it frees up capital that can be invested elsewhere in the business. The drastic cost reductions that come from outsourcing to the Philippines allow small companies to not only stay within budget but have some flexibility to strategise where they choose to invest their money.

Having cash on hand can be especially beneficial for startups looking for funding. Investors are more likely to be attracted to a company with the money to funnel into revenue-generating activities like marketing or research and development,” states Ellspermann.

Businesses can focus on core areas

Outsourcing relieves businesses from the time and commitment of maintaining non-core tasks. Management and employees can then focus on essential business aspects like attracting new clients, developing marketing and advertising, investing in research and development, maintaining a robust social media presence, and providing high-value client services.

“As outsourcing teams in the Philippines take on secondary functions, in-house teams can concentrate on essential business operations that will contribute to faster company growth and increased profitability,” explains Ellspermann.

Increased productivity of in-house teams

Outsourcing lower-level tasks to BPO providers allows in-house employees to focus on their specific jobs. This can lead to boosted productivity, higher employee retention, and increased job satisfaction, which is especially important as companies grapple with the Great Resignation.

Additional free time can also be used to hone employee skills through training, seminars, workshops, or team-building activities. “A happier team is a more engaged, productive, and efficient team that’s invested in a company’s success,” says Ellspermann.

Immediate access to a skilled workforce

While having a large staff of full-time employees can benefit growing SMEs, most can’t afford the expenses of hiring, training, and managing them. The solution

Outsourcing to the Philippines is cheaper than running an in-house operation. Companies gain access to a highly skilled and dedicated Filipino workforce that is well-schooled in all aspects of the BPO.

Fluency in English makes Filipinos perfectly suited for voice-based customer service roles. In short, outsourcing business processes to the Philippines can dramatically improve customer experiences, brand loyalty, and customer retention.

The Bottom Line

Many startups and SMEs in the UK must cut corners wherever they can simply to stay afloat. As such, they are often reluctant to invest in outsourcing. These small businesses fail to realise the tremendous ROI that can come from outsourcing secondary business processes.

The old saying goes, ‘You need to spend money to make money.’

“The bottom line is when it comes to business scalability and growth, outsourcing to the Philippines is money well spent,” concludes Ellspermann.