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5.) The need for geopolitical stability
Geo-political instability could create a major problem for any organization. Near-shore locations are believed to provide a much stable atmosphere as compared to off-shore destinations. Although there has been no instance of instability in major outsourcing destinations like India, in recent times; there are no guarantees as India has experienced such conditions in
past. In addition to this many companies also feel
need to set up additional outlets in near-shore destinations as a back up measure to deal with any negative situation. One more factor, that gives near-shoring a pat in
back.
Countries that can benefit from Near shoring
Near-shoring will benefit most Eastern European courtiers like Romania, Czech Republic and Slovakia, that lie bordering UK. In addition to Easter European countries, some destinations around USA like Mexico, Canada and Costa Rica will also benefit immensely.
Among Eastern European countries Romania stands a major chance to come out as a winner. This is because of
fact that
country has advanced infrastructure, geographical proximity, cultural affinity to UK and an investment friendly climate. In addition to this Romania also has a good pool of well educated and highly skilled youth ready to take over. UK firms feel
cost of operations in Romania will be much lower as compared to India which is currently
most favored outsourcing destination. Other Eastern European countries that are likely to benefit are Morocco, Hungary and
Czech Republic.
In
west it is Mexico that is calling
shots. As compared to other near-shore destinations to US like Canada and Costa Rica, Mexico is considered much cheaper and close location. Many Mexican towns are located in close proximity to
US and can be reached by road. Mexico also has a stable atmosphere with good communication and technological infrastructure. Cultural affinity to US and availability of cheap and well educated English speaking youth are other plus factors that can act in favor of Mexico.
The future of near-shore outsourcing
Although
situation looks bright, there are some problems that can limit
pace of this evident and evolutionary progress. One major issue is
issue of local service providing companies. Thought countries like Romania have enough resources they lack
availability of certified companies who can cater to high-end outsourced projects. Also
projected growth of near-shore outsourcing by some major research organizations is relatively small as compared to
size of
off-shore market in countries like India. At present Eastern Europe and other near shore destinations seem right for firms who plan to set up their own outlets rather than make use of services from local contractors. But this situation can change in
near future.
If
near-shoring trend becomes successful and generates success stores it is sure to catch up just like off-shore outsourcing did. One does it and others follow, because nobody likes to take chances in
corporate world.

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