Philippines As An Outsourcing Destination
Staff leasing in the Philippines can offer numerous advantages to companies looking to expand their operations
Cost Savings
Staff leasing can significantly reduce labour costs for businesses, especially in countries such as the Philippines, where labour is relatively inexpensive in comparison to developed countries. The provider handles all HR-related expenses, such as payroll, taxes, benefits, and other administrative costs, lowering the client's overhead costs.
Lower labour costs in the Philippines
Labour costs are significantly lower in the Philippines than in developed countries such as the United States, the United Kingdom, and Australia
The cost of living in the Philippines is also lower, which means that professional salaries are lower as well Businesses that outsource to the Philippines can take advantage of this cost advantage, resulting in significant cost savings
For example, in the Philippines, the average hourly rate for a software developer is around $15-$25 per hour, whereas in the United States, the hourly rate is around $60-$100 per hour Similarly, a customer service representative's hourly rate in the Philippines is around $5-$8 per hour, while a customer service representative's hourly rate in the United States is around $15-$25 per hour.
Reduced overhead expenses
When you outsource, the third-party provider handles all HR-related costs, such as payroll, benefits, taxes, and other administrative expenses This can significantly reduce the client's overhead expenses, allowing them to devote more resources to their core business activities Outsourcing can also reduce the need for office space, equipment, and other resources, lowering overhead costs even further
Tax incentives and other cost-saving measures
To encourage foreign investment and outsourcing, the Philippine government provides various tax breaks and other cost-cutting measures Among these measures are:
1. Income Tax Holiday (ITH): The ITH exempts eligible businesses from corporate income tax for up to six years, depending on their location and industry
2. Special Economic Zones (SEZs): The Philippines has several SEZs that provide tax breaks, streamlined government processes, and other advantages to businesses that operate in these areas.
3. Reduced tax rates: The Philippines has a relatively low corporate tax rate of 30%, and some industries, such as IT-BPO, benefit from a reduced tax rate of 5%
Access To A Skilled Workforce
Staff leasing providers in the Philippines typically have access to a large pool of highly skilled and educated professionals who are fluent in English and culturally aligned with Western businesses This gives businesses access to a diverse pool of talent, especially in IT, customer service, and back-office support.
Availability of highly skilled and educated professionals
Another benefit of outsourcing to the Philippines is the availability of a highly educated and skilled workforce The country has a strong education system that produces over 500,000 graduates per year, with a sizable proportion working in IT, engineering, and business. Many of these graduates speak English fluently, as it is the primary language of communication in the outsourcing industry
Through various programmes and initiatives, the Philippine government has also invested in developing a talent pool of professionals The Technical Education and Skills Development Authority (TESDA), for example, provides vocational training to individuals, assisting them in acquiring skills in demand in the outsourcing industry The Philippine government has also established the Commision on Higher Education (CHED), which is in charge of overseeing educational quality in the country's higher education institutions.
English proficiency and cultural affinity
Another reason to consider an offshore company is the country's high level of English proficiency and cultural affinity with Western countries English is a widely spoken and understood official language in the Philippines. This allows for seamless communication between clients and the outsourcing team, resulting in faster turnaround times and fewer errors in work output
The abundance of talent in specific industries (e g , IT, customer service, back-office)
The Philippines is well-known for its abundance of talent in certain industries, such as information technology, customer service, and back-office operations This is because the country has invested in education and training, as well as having a highly skilled workforce
The Philippines has a significant pool of skilled professionals with expertise in software development, web design, and mobile application development in the IT industry. The talent pool in the country is not only highly skilled, but also adaptable and flexible, allowing them to keep up with the rapidly changing technological landscape.
The Philippines is also a popular outsourcing destination in the customer service industry, with a workforce known for its excellent communication skills, empathy, and customer-centric approach Customer service representatives in the country receive extensive training in areas such as customer engagement, problem resolution, and customer satisfaction promotion
Conclusion
Recap of the benefits of staff leasing in the Philippines
In conclusion, staff leasing in the Philippines provides several advantages to businesses, including:
1. Lower labour costs: Staff leasing in the Philippines can help businesses save up to 70% on labour costs Because the cost of living in the Philippines is lower than in most developed countries, wage rates are lower.
2. Reduced overhead expenses: Outsourcing to the Philippines allows businesses to save money on overhead expenses such as rent, utilities, and equipment because these costs are typically covered by the outsourcing provider.
3. Tax breaks and cost-cutting measures: The Philippine government provides tax breaks to outsourcing firms, such as income tax holidays and lower corporate tax rates This reduces the cost of outsourcing in the Philippines even further.
4. Availability of highly skilled and educated professionals: The Philippines has a strong education system that produces over 500,000 graduates each year, many of whom work in IT, engineering, and business. The country also has a highly skilled and adaptable workforce that can meet the needs of individual clients
5. English proficiency and cultural affinity: The Philippines is well-known for its high level of English proficiency and cultural affinity with Western countries, which results in smooth communication and a better understanding of the client's business needs
6. A large pool of skilled professionals in specific industries, such as IT, customer service, and back-office operations, exists in the Philippines, providing businesses with ready access to talent
Overall, staff leasing in the Philippines offers businesses an efficient and cost-effective way to access a skilled and adaptable workforce, allowing them to increase productivity and competitiveness in the global market
The potential for businesses to achieve growth and success through staff leasing
Staff leasing in the Philippines provides numerous advantages to businesses, including cost savings, access to a larger talent pool, scalability, and improved customer service Businesses can focus on their core activities, scale their operations quickly, respond to changing market demands, and improve customer satisfaction rates by outsourcing non-core business activities This can lead to increased productivity, efficiency, profitability, and competitiveness, ultimately assisting businesses in their respective industries in achieving growth and success.
Final thoughts and call to action for businesses to consider staff leasing in the Philippines.
Finally, staff leasing in the Philippines is an excellent way for businesses to gain access to a highly skilled workforce at a lower cost while improving efficiency and scalability The Philippines has become a top outsourcing destination for businesses in a variety of industries, thanks to a large pool of talented professionals and a strong cultural affinity for Western business practises
As a result, I recommend that businesses consider staff leasing in the Philippines as a strategic option for non-core business activities They can focus on their core competencies, save money, improve customer service, and achieve growth and success in their respective industries by doing so Businesses can leverage the benefits of outsourcing to the Philippines and take their operations to the next level with the right partner
So, if you're considering staff leasing in the Philippines, I recommend doing your homework and partnering with a reputable outsourcing provider who can guide you through the process and ensure a successful outcome. Don't pass up the potential benefits of staff leasing in the Philippines; act now and begin your journey to growth and success!
