Why Australian businesses should not outsource to the Philippines

Are you thinking of outsourcing essential parts of your business to The Philippines, India or one of the other global hotspots? Don’t do it. Especially not if you’re planning to try and self-manage them on something like UpWork. Don’t even think about engaging with one of the big call centres if you’re taking less than 20 seats, either.  Want to try and self manage a single seat lease in a serviced office from Australia? Dream on!

Yes outsourcing works. Yes freelance Virtual Assistants are incredibly useful and effective if managed properly. Yes, if you follow the lead of some of Australia’s biggest companies and partner up with one of the major Business Process Outsourcing operators, take hundreds (or even thousands) of staff on board you’ll get looked after very, very well.

Why it doesn’t work for anyone else…

If you don’t have any experience directly managing multi cultural teams. If you aren’t willing to physically go there at least a few times a year. If you haven’t got extremely solid SOPs which are easy to understand then, unfortunately, it just won’t work. Sure, if you’ve got a one-off job then go to UpWork or Freelancer, hire someone to design a logo or to write a blog post. That’s what freelancers are for. Too many people use those platforms to manage full time, or nearly full time staff. Here’s why that doesn’t work.

Australian small businesses can save big by using freelancing platforms. Absolutely. No employment on costs, no hassles with contracts. You’re not going to end up in a tribunal and, yep, if a staff member doesn’t perform properly, lets you down or your needs change – guess what, you summarily dismiss and move on.

The right tool for the job…

Basically, in my experience, most people who use freelance platforms to employ full time people are doing it for these reasons. Not only does that make them bad employers, but you’d have to question their general ethics. Where the freelance sites really come into their own is when you’ve got a whole lot of small projects that require different skill sets. That’s what they’re designed for and they work extremely well.

Here’s the thing about a freelance platform, not only can the employer summarily dismiss someone, the employee can just walk out with no notice. When you’ve engaged with someone, trained them, spent all that effort working extremely hard to get them engaging with your customers (not to mention in many cases encouraged them to build a relationship with your customers) and this happens. It can be extremely expensive to resolve.

Don’t waste thousands of dollars…

One Quotenamic customer that engaged us to consult with them on how to resolve exactly this problem had been through six VAs in as many months. Each and every one he had put through training, and within 2 weeks they were either gone of their own volition or he had to let them go (mainly for not being available when they said they would be). So let’s say it takes 20 hours to get someone up to speed on a basic VA position. That’s about average unless the requirements are extremely simple. Here’s how that math works out:

Employer’s hourly rate: $100

VA’s hourly rate: $5

20 hours of training = $105 * 20 = $2100 in lost income and direct employment cost.

2 hours of screening, interviewing and advertising to find the replacement candidates: $200

Total cost of employment: $2300

6 VAs lost in a year: $13,800

This was the case for this particular business, a tradesman who hired a VA to make his life easier with things like updating his website, writing blog content and doing his SEO as well as direct e-mail follow up with his clients after he’d submitted a quote for their perusal. What was he doing wrong?

A couple of things…

It’s a lot easier to pay an SEO freelancer, a blog writer and a web designer for a few hours a week (as in three individual people) than it is to find that skillset all in one place. As to providing long-term customer service to his customers though, many of whom were repeat, UpWork is not the place to find that. Nor is it somewhere to find someone with the skillset to convert a prospect once the quote has been submitted.

How did we do things differently for this particular client?

First off we recommended that the non-customer facing stuff (blogging, SEO and web management) remain on UpWork. None of these things take a lot of time and nor do they cost a lot of money. They are also not consistently required, here the flexibility of a freelance platform really makes sense. Especially when they don’t involve a lot of training and really don’t have any impact on your business if you have to replace them.

Then we fully automated all of his outgoing quotes. In this case his pricing was easily quantifiable. It’s not always the case but by-and-large our team can make it happen. We’ve automated quoting systems for everyone from Bobcat operators to Insurance salespeople to Graphic artists and Printers. Anything that is quantity based and anything that has fixed pricing based on specific variables.

We then embedded this form on his various web pages.

What did this achieve?

He didn’t have to drive around and see clients all over town. They put the information into his website and a few minutes later they automatically receive a professionally designed PDF quote attached to an email with all his branding on it.

That still left us with a problem…

What about the customer service aspect? Here’s where the Quotenamic team really come into our own.

After working through to understand his business comprehensively we suggested that he stop answering his phone and his email entirely.

Wait… what?

Here is what sets Quotenamic apart from services like UpWork and those big call centres that the likes of certain Australian Telcos like to work with. We are a completely Australian managed company. More than that, only one of the three Australians involved is actually based in Australia (yes, there’s someone on the ground you can call too).

The other two individually interview each and every candidate, on the ground. They are also available to them on a day-to-day basis to train them and get them up to speed with the needs of the people they are working on behalf of. They work directly with the clients but there is always an Australian on site that the client can call if there are any problems. If there are problems, we take them extremely seriously and deal with them swiftly.

So what was the outcome?

His phone seldom rings unless it is one of our team telling him that they’ve booked a job, on total autopilot. 9 times out of ten the first thing he knows is when he gets notified that it’s booked in his calendar. The other person who regularly calls him is his mother. Oh, and his mates. He’s always got time to talk to them and because he’s not racing around town individually assessing each and every quote he’s not usually on the road, either.

Of course… it must be costing him a bomb!

Actually no, it’s not. It is costing him a lot less per month than those full time VAs on UpWork did (especially when you consider the cost of them resigning, getting fired and training replacements). It varies a little on a case-by-case basis but, generally his monthly bills are around $400 Australian dollars all told with his phone calls included.

It does not have to be expensive to put something like this in place, but if you approach it without the knowledge on the ground and the experience of a company like Quotenamic. It can be an extremely costly mistake.

P.S. – just in case you were wondering. If you could find a call centre outsourcing operation that would allow you to have a single seat and manage the staff member for you, they start at north of $1500. Of course, a certain Telco pays a lot less but most of us just do not have the need for thousands of staff.

Contact us today if you’re ready to make the right move and revolutionise your business.


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