Why E-Commerce Businesses Choose Nearshoring?
Over the past year or so, there’s been a shift towards nearshoring business processes. If you’re not familiar with the term, nearshoring involves contracting professionals in countries within the same continent or region.
One sector that has seen a considerable shift towards nearshoring is e-commerce. We’ve all read or heard about how the pandemic has accelerated the uptake of online shopping. As a result, agencies specialising in e-commerce and businesses that are built around e-commerce are looking to build partnerships with reliable companies that have the technical expertise and improved levels of support.
In light of this movement towards nearshoring, we thought we’d take a look at the benefits of nearshoring with a special focus on why nearshoring is a great option for e-commerce businesses.
What’s Driving The Growth of Nearshoring?
It’s important to note that nearshoring isn’t industry-specific. Companies from every industry, sector and vertical use nearshoring to achieve their objectives. However, there are certain domains that are more suited to the nearshoring model.
Looking at IT and our specific area of expertise, which encompasses Python development for startups, SMBs, and enterprises, there are a number of reasons why this shift towards nearshoring is gathering pace.
Primarily, it comes down to trust, transparency and a sense of familiarity in relation to business practices. Data security and IP rights are a growing area of concern for western companies.
Another factor that a few of our clients have alluded to is that, with the digital environment becoming ever more competitive, founders and executives are beginning to place more emphasis on the quality of work and working relationships rather than cost-effectiveness alone.
Similarities in Cultural Values & Legal Systems
We’ve mentioned the importance of cybersecurity and data protection, especially with the introduction of the GDPR legislation that has placed more stringent demands on businesses operating in Europe.
Being geographically closer allows for more effective oversight and verification of systems and working processes. Furthermore, choosing to nearshore in a country with comparable cultural values and a well-established legal system reduces the likelihood of data security breaches and IP theft.
Fast Access To a Larger Talent Pool
Any founder or hiring manager is aware of how challenging it can be to identify and then hire talented individuals. The financial costs incurred during the hiring process can build up quickly; recruitment agencies are known to charge exorbitant commissions for finding specialists, especially with technical hires. There are also the costs incurred in terms of time.
Deciding to follow a nearshoring strategy opens up a much larger talent pool of specialists. A greater supply of talent means you can take advantage of competitive labour costs as well as currency arbitrage. A larger talent pool also means companies can find highly skilled talent quickly, especially when compared to finding and onboarding a new full-time member of staff.
Another point that should be mentioned is that nearshoring makes it simple to respond to changes in staffing demands. Whether that change is a need to hire more staff or reduce the size of your workforce, nearshoring brings a greater degree of flexibility. Improved response times to staffing demands or talent gaps can help in improving the speed to market or, in e-commerce, important technical updates and improvements to functionality.
Smaller Time Differences
Of course, if you choose to work with a business based in Central or Eastern Europe rather than Asia, you’ll benefit from the smaller time difference. The overlap between working hours makes communication smoother and allows for quick follow-ups should any issues or urgent requests arise.
Consider the standard time difference between London (GMT+0) and Bangalore (GMT+4:30), and London and Kyiv (GMT+2). This time difference means that the working hours overlap for the UK & Ukraine is 4-5 hours, while for UK & India only 2 hours.
In the fast moving, digital world where business decisions and collaborative work takes place, instant messaging is a common form of communication and liaison between the various stakeholders involved with a project. Smaller time difference means more efficient communication and improves the overall working relationship.
Reducing Operating Costs
We’ve mentioned the benefits of nearshoring in relation to accessing a larger talent pool, which can have a significant impact on reducing operating costs. We also need to cover the fact that nearshoring allows companies to reduce their operating costs in other ways too.
Finding the best talent with the necessary experience in the domestic market can lead to new business proposals that look great but cost an arm and a leg. You’ll quickly find that you can get similar or better results by expanding your search to include rising nearshoring IT hubs such as Ukraine.
We Enjoy Working With Entrepreneurial Minds
If you’re ready to take the next step and put your business in the best possible position for sustained growth or to achieve efficiencies through well-considered digital integrations, reach out to us.
Here at PLANEKS, we offer a range of web development services, including marketplace automation solutions for e-commerce businesses. We’re an experienced team, and, more importantly, we’re comfortable working remotely with fellow entrepreneurial minds.
If you’ve got an existing or future project in the works, whether it’s e-commerce related or not, get in touch with us for automated, digital integrations.