Nearshore: What is it and how does it work?


Nearshore! The term has long since entered the managers mind and has become part of the lexicon of companies worldwide. The concept itself has little to know, since it is a kind of subcontracting, or outsourcing, of a given activity from a country that is relatively close in terms of distance or time zone (or both, actually). The client who contracts the service seeks to take advantage of issues associated with proximity such as geographical, temporal, cultural, linguistic, economic, political, or even historical links.

But, despite being relatively simple to explain, the concept of nearshore contains a set of advantages that go far beyond these few words and that, not by chance, have been winning managers all over the world. Hiring a remote team that is, after all, geographically close to the organization guarantees several benefits that are good for the business.

In the genesis of this idea of nearshore, there will be perhaps another older one, say experts, that provided services outsourcing of the organization. In this field, managers know that the possibility to outsource the company’s activities, through a trusted partner, offers greater flexibility and efficiency to the organization. And here is the central question point: working in this outsourcing regime is, above all, a management decision, in which cost should not be the only factor to be considered. Providing flexibility and agility to the company’s processes are added value that must also be considered... in outsourcing as well as nearshore!

A trend that becomes global

According to Statista, in the second quarter of 2021, 44 global in-house centers (GIC) were setup and expanded in the offshore/ nearshore market worldwide. During the same period, the number of offshore/nearshore delivery centers in Asia expanded by 22 new centers.

The data give a good account of an undeniable reality: the nearshore is an increasing trend of the global market, to which the Portuguese technological partners who have long looked to our country as a destination of excellence in this field, do not escape.

Data from the study "Nearshore Portugal - Tendências na Gestão de Talento - 2ª Edição" from APDC show that the Nearshore sector in Portugal has experienced significant development in recent years. Citing AICEP, the study recalls that between 2015 and 2019 the Business Services sector in Portugal translated a growth of 43%. The value shows that this sector has been gaining an increasingly significant expression in our country, employing more than 55,000 people who provide services mainly to Europe (89.7%), but also to other regions of the globe, such as Africa and the Americas. In Portugal, nearshore companies are predominantly located in major urban centers - Lisbon and Porto- but the truth is that cities such as Braga, Aveiro, Covilhã, Leiria and Évora are also already among the chosen destinations.

Portugal is the nest of talent

Portugal is “THE” choice to be made! Besides being a safe and stable country (economic and political), the Portuguese labor system is flexible and facilitates remote working. The quality of human resources, the country’s strategic location, good telecommunications networks and even the climate are just some other reasons pointed out by national and international companies, who have chosen to set up their IT skills centres in Portugal. And yes, on a nearshore basis!

The country stands out for the profile of its professionals and for the quality of higher education - with several business schools among the best in the world - and high level of schooling of the population.

On the other hand, Portugal can act as the door to the European markets. The country shares London’s time zone, one of the Most Critical global Markets, facilitating teamwork for multi-site Teams. Also, it is the closest European country to the US, opening roads into other business possibilities.

In addition to the business assets, there are others such as the undeniable advanced infrastructure that the country has with high-speed connections and cloud technology, for example, to foster productivity and effectiveness in international projects associated with this service model. 

Robust legal system

Last but not least - and a decisive thought when we talk about the provision of IT services in Nearshore -, Portugal has a robust legal system that allows companies to enjoy the appropriate guarantees under the Intellectual property right. And the organizations that choose to place in Portugal their nearshore centers, know that they can enjoy a work of excellence, focused on creating value, best of breed offer and high level of skills allowing the country to ensure a differentiating and very competitive offer in the market.

In addition to all these advantages, choosing a trusted and experienced technological partner in the market is crucial. No one doubts that the choice of partner is more than halfway to success of the business and, also here, Portugal has a lot and good offer to consider. The country receives your organization with open arms, and partners have their own and differentiated features and valued frameworks that meet all needs, whether in terms of productivity or safety. For example, Boost IT provides a technological framework that ensures IP security and infrastructure scalability of clients worldwide, minimizing cyber risks and threats.

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