Outsourcing within the Philippines – Locations and Tradeoffs

The Philippines has always been an outsourcing destination since the 90’s. For years, outsourcing talents has been concentrated in the country’s capital, Manila. To decongest the capital, the government made an effort a decade ago to distribute resources, allowing other cities and regions in the Philippines to undergo a massive industrial and digital transformation. This has given businesses more options to look for ideal outsourcing talent and location outside the country’s capital.

Will it matter where from what part of the Philippines you hire your virtual assistant from? Yes, to some degree.

Almost 70 percent of the nation’s population lives on the two biggest islands: Luzon and Mindanao. Among the other large islands are Bohol, Cebu, Negros, Palawan, Panay, and Leyte. If you plan to hire a lot of Filipino VAs or even set up an office in the Philippines in the future, making the decision as to “where” in the 7,641 islands would you hire Filipino workers from is a critical prerequisite for doing business in the Philippines.

Philippines Rank High as Outsourcing Location_

Philippines Rank High as Outsourcing Location

Overall, the Philippines is getting outstanding ratings from research firms like Tholons Inc. who recently ranked the Philippines 6th overall in the world as an outsourcing destination. In addition, two of its cities, Manila and Cebu placed 4th and 15th out of 100 among “super cities” for global outsourcing.

But what about the other cities in the Philippines? Maybe a smaller town could give your business the edge in terms of lower cost structure without sacrificing quality of work output.

That said, which talent from which city should you hire?

5 Current Guidelines to Factor in When Selecting Locations

Here are five of the proven guidelines to factor in when you are recruiting Filipino workers.

1. The Farther Away From Cities, the More Potential Problems…Sometimes

When you look at resumes or receive responses to the help-wanted you have placed on Onlinejobs.ph, you will notice the name of the city or region where the applicant lives. We advise you to have a map of the Philippines in front of you when you conduct your initial review of potential contract employees.

In general, the farther away from any city point, the more negatives you will have to deal with. Outside the cities, cluster the less educated, less experienced in the workforce, and less ambitious.

Those places also suffer from less government and private sector funding invested in improving the infrastructure such as power grids and telecommunication towers. As a result electricity and internet outages can happen regularly. Power outages may be specific to certain regions but storms are quite common all over the Philippines.

electricity outages can be frequent

However, some outsourcers who identified talents in the rural areas have made it their business to solve some of these perennial problems. They might have purchased generators or solar power equipment and portable broadband for the hire. And the payoffs were huge.

Why? To begin with, the cost of labor can be significantly lower in the rural areas. Secondly, it is in the national ethos of the Filipino workforce to be extremely grateful to employers who equipped them with what they needed to become employable. Those contract employees will remain loyal. They will also partner with you in bringing your business to the next level. But because they themselves are not entrepreneurial, they will not “steal” your business.

2. Where Power Outages are Less Likely to Happen

So many variables affect the reliability of power in any location. Those range from drought to the number of residents using generators which do not drain supply from the grid.

Therefore, you as a business have to do a just-in-time fact-finder about the area. What many outsourcers do, as part of their recruiting, is directly ask applicants what their contingency plans are for power interruptions and internet disruptions. The experienced ones have developed sophisticated systems to cope. For example, through social media they create human networks to alert them of an upcoming reduction of power or outage. Then they either turn to using portable generators or have access to it at a relative’s. Also, it’s quite common especially in urban cities to find a number of internet cafes and coworking spaces accessible to people 24/7.

3. Networks of Highly Skilled Professionals

Even in this era of telecommuting, much information and insight are transmitted through professionals who have in-person proximity to each other. That is exactly why the creative and ambitious flock to creative centers like Manhattan.

If you are outsourcing software development, animation, and advertising, you need that kind of give-and-take among creatives. This means recruiting in tier-one areas such as Metro Manila, Metro Cebu, and Davao down south. And those hires can provide qualified referrals, lowering the probability of hires who are not suited for the job.

Punctuality Required

4. Punctuality Required

If you plan to set up shop in the Philippines, you’ll have to factor in the traffic and commute if you want your VAs to work onsite. For many BPOs, the workforce must be onsite, and on-time.

Remember that bigger, more metropolitan cities have better infrastructure AND more traffic. Smaller cities have less traffic congestion BUT their infrastructure might not be good enough.

5. Personal Values

In metro areas, the workforce has usually been socialized to the American mindset of putting work first. Not that they are not family-oriented. They just know how American businesses work, making it easier to find people to work in your timezone or on Philippine holidays.

Exceptions You Might Make Now or in the Future for Selecting Locations

Once you’ve experienced outsourcing for some time, you can take that leap and start experimenting when hiring.

You can begin with “breaking the rules” and explore the lesser known cities. That could give you unique access to untapped talent, large-scale community support, and lower costs.

This is easier to do now as more and more Filipinos are opting for careers on their own terms. Many are determined to earn a living in their hometowns far from the city proper. The lure of the big city becoming less desirable compared to the opportunity of having a career while staying close to home.

The tradeoffs though is you will likely have to provide more training than you would have in tier-one locations.

More Training Required

Outsourcing: Driving Infrastructure Improvements

As outsourcing to the Philippines increases, both the government and the private sector are now working to improve the infrastructure. They want your business. More business means better economic growth. This gives you even more options in the future. You could even be among the early adopters who pile on the profits by outsourcing where the talent had not been uncovered and the costs remain low.

Where Our Workforce Lives

Since we have a relatively large staff (compared to most small businesses) in the Philippines, I find it valuable to show you where we have workers.

Family Oriented

We’ve found great talents in Davao, Iloilo, Cebu, Negros, Manila and other places. We tend to hire in the south because:

  1. We do a good job recruiting and screening
  2. Salaries are lower
  3. They’re more family oriented…which we like.

Overall, you’re likely to find great virtual workers with great work ethics anywhere in the Philippines. We prefer to find the talent we need wherever it is, rather than to focus on a specific location.

If it’s your first time hiring a virtual assistant, don’t consider location just yet. Look at their skills, experience and personality first. If you need help with that, go to OneVAAway.com and take our 7 day hiring challenge. I’ll show you the step-by-step process of hiring a great VA, regardless of what city or town you’re hiring from.

240px Jonasheadshot

About John Jonas

John Jonas is a long-time outsourcing expert and the creator of OnlineJobs.ph.

Since 2005, John has taught hundreds of thousands of entrepreneurs how to profitably delegate to VAs in the Philippines (and get their lives back in the process).

With help from his own VAs based in the Philippines, John has created an outsourcing empire that allows him to work 17 hours/week and to spend most of his time with his wife and 5 kids.

Find John at JohnJonas.com and Facebook.

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  1. Rubylin G. Salvo says

    I am an Accounting graduate with 15 years of experience on this field in a private company. I just resigned at work for good just to give a break for myself and to give time to my family.I am now at home planning to work just from home. I am interested to be part of your team if you want to try my capability, capacity, trustworthy and being dedicated to the task assigned to me. Looking forward to be connected to know me better. I want to explore another field aside from my profession which is the BPO field. You can reach me thru my mobile # +639178437047.

    Thank you so much and more power!

    Humbly yours,
    Rubylin G. Salvo

    • says

      Hi Rubylin, kindly email our support team (support@onlinejobs.ph) so that they can help you increase your ID Proof score, thus increasing the chances in landing an online job

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