Boost Startup Cost Savings and Cost Efficiency Through Offshoring

Small businesses remain in a precarious position in 2024. The threat of an economic downturn continues due to the lingering effects of the pandemic. Inflation is still quite high. Interest rates are up. Debt continues to rise. The US Chamber of Commerce expects these factors to decrease consumer spending and impede the economy.

Couple these circumstances with the continuing talent shortage. Small business staffing is on the rocks with high labor costs and talent acquisition challenges. Startups are finding it difficult to fill positions with qualified candidates—so much so that a Manpower Group survey reported a 76% talent shortage in companies with 10 to 49 employees.

Regardless of these prevalent issues, small businesses may find solutions in offshore staffing. Hiring offshore employees brings scaling, talent, time, and cost advantages. These benefits of outsourcing for small businesses may give your startup the boost it needs to win against current economic factors.

How Offshoring Helps Small Businesses Beat Challenges

Multiply Your Business and Your Workforce

Startups face the common challenge of scaling. Amazon research found that 70% of UK and European SMEs are challenged to scale their businesses online. There’s a lack of logistical and compliance support. At the same time, US-based entrepreneurs and content creators, Steph Gordon and Den Mathu, express that startups face growing pains when building a solid team.

Small business outsourcing or offshoring assists SMEs in scaling their business and their teams. Your business model depends on a growing, reliable team. However, offshoring proves to be more sustainable in the long term than outsourcing for small businesses.

Outsourcing depends on a third-party service provider. The employee composition may change without your consent. Such volatility may be too much for companies. However, in offshoring, you stick with the professionals hired for you. You control your team directly, giving you more opportunities to scale.

According to Deloitte, 70% of companies surveyed in 2021 aimed to develop their capabilities through offshoring. By 2023, 59% of the companies achieved their objective. Due to this, an offshoring strategy works to scale your business and your workforce.

Hire Specialized and Qualified Workers

The global talent shortage has led businesses to clamor for expert employees. Based on a Clutch survey, 18% of small businesses in 2022 offshored operations in hopes of working with experts. 

IT offshore staff philippines
IT is one of the in-demand offshored staff jobs in the Philippines

In the Philippines, companies also commonly offshore the following roles:

  • Web Development
  • IT
  • Quality Assurance
  • Customer Service
  • Front-End Development
  • Graphic Design
  • Sales Development
  • Accounting
  • Administration Support

Offshoring and BPO companies for small businesses provide access to wide, diverse talent pools. You can receive the support you need such as IT, accounting, HR, and payroll. In 2023, 62% of Deloitte respondents received HR support. Meanwhile, 79% got payroll assistance, 57% for IT, and 91% for accounting.

Beat Time Zone Differences

Time zone differences between the Philippines and the US, UK, Australia, or other locations may be a concern. This factor has become a major issue for companies that need round-the-clock services like hotels. Offshoring and outsourcing opportunities for small businesses can provide that 24/7 support.

24/7 offshoring philippines
Offshoring staff in the Philippines offer 24/7 support

Filipino remote workers connect with their overseas teammates regardless of the time zone differences. They adjust their work schedules to better accommodate the regular working hours of businesses in the US, UK, Australia, or other locations. This dedication to service is one reason why Philippine remote workers are usually the chosen offshore partners by companies.

Hit Savings and Cost Efficiency Targets

Lastly, limited resources and financial budgets make it difficult for SMEs to hire new employees. Deloitte found that 83% of companies surveyed aimed to reduce costs, and 82% planned to boost process efficiency through offshoring in 2021. About 84% achieved cost-saving goals and 88% increased process efficiency by 2023.

For example, when you find, hire, and build your team through offshoring, you may work with quality talent with lower labor costs than onshore talent. In addition, you free up time and resources, which you can use for your core functions. Case in point is The LOTE Agency, which saved 75% on employee costs.

4 Specializations Where Offshoring Delivers

Human Resources

Talent shortages can be filled with capable workers through offshore HR services for small companies. The Deloitte survey highlighted 48% of businesses that aimed to access a wider talent pool in 2021. By 2023, 26% have gained such access and filled their needed positions. The best HR offshoring for a small business can place you in a position to build and support your team.

offshore payroll philippines
Offshoring payroll to a remote team in the Philippines cuts costs and saves time


Payroll may be difficult to execute for small teams in the US, UK, Australia, and other places. However, payroll offshoring streamlines the process without any hassle. Ultimately, you gain around 70% savings from offshore payroll service for a small company.

Information Technology

Manpower Group found that the IT industry has a 76% talent shortage. Yet offshore IT services bring you essential support. Deloitte surveyed 51% of companies who wanted to accelerate their digital agenda. Over 60% were able to achieve this acceleration in 2023. Small business IT offshoring services may help you digitally transform your company through expert IT support.


Finally, as much as 91% of companies in the Deloitte report expressed they needed support for performing finance-related functions. Outsourcing accounting services for small businesses fulfills that need, yet offshoring accounting brings better support.

Outsourced accounting for startups relies on the limitations of working with a third-party provider. In contrast, offshoring allows you to have direct, 24/7 access to your very own accountant. A dedicated professional will always work better than random workers assigned to your account. 

Scale and Succeed like The LOTE Agency

The LOTE Agency is an Australian communications company that brings audiences to government bodies, corporations, advertising agencies, and marketing professionals. However, the volatility of their work volume and business needs made scaling up difficult. When demand for their services skyrocketed, they needed quality talent to pick up the slack.

By offshoring human resources, The LOTE Agency hired quality Filipino talent within 20 days. They also received full HR support from sourcing, onboarding, and payroll to benefits and offboarding. Nina Azares is one of the trusted offshore staff of The LOTE Agency. She has been managing clients and projects end-to-end for more than four years.

Watch to see the results delivered by Nina here:

Because of this, The LOTE Agency keeps up with its clients. Their in-house team provides on-site support, while Filipino remote workers provide project support as needed. All in all, The LOTE Agency saved as much as 75% on total labor costs.

At the same time, The LOTE Agency’s in-house team gained the focus to dedicate themselves to clients. Penbrothers fulfilled all administrative matters regarding their offshore team. In addition, the diversity brought by Filipino remote workers allowed The LOTE Agency to connect with their diverse clients.

Win Against the Economic Downturn Through Offshoring

Through offshore services for startups, you can perform the following:

  • Scale your company
  • Access qualified employee candidates
  • Receive 24/7 support
  • Save resources

The low offshore staffing SME pay gives you the flexibility and ability to keep up with growing business demand. Succeed in your market like The LOTE Agency and face the future with high hopes. You can wade through the forecasted economic downturn and come out strong.

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