Outsource to Costa Rica: A quick guide

During the big break for outsourcing, Central America rose to be one of the biggest offshoring and outsourcing hubs in the world.

Companies and major players in various industries raced to outsource to Costa Rica in the pursuit of staying ahead of the competition. But what makes this Central American nation so appealing?

Why do companies outsource to Costa Rica?

Companies often choose to outsource to Costa Rica for a multitude of reasons.

As one of the leading Latin American countries, Costa Rica has emerged as an attractive outsourcing destination due to its skilled workforce, strong educational system, and proficiency in English.

Businesses often practice outsourcing because of its cost-saving benefit, among many others.

These apply to most countries; however, Costa Rica amplifies certain advantages depending on the company’s location.

In particular, companies in American territories can gain an edge when they outsource to Costa Rica.

Lower labor costs

In most third-world countries, labor costs are lower due to lower prices and overall cost of living compared to first-world countries.

Companies often take advantage of this, especially those in or near North America. Outsourcing to Central America allows companies to maintain quality without exceeding their budget.

Predominantly English-speaking professionals

The country has predominantly English-speaking citizens as English is widely taught and used in educational institutions, professional work environments, and even in pop culture.

This ensures that most working professionals in the country can keep up with the pace and requirements of client companies’ global operations.

Proximity to major outsourcing countries

Companies and businesses that outsource to Central America are usually based in the US or in Canada. This proximity allows both parties to operate within the same periods and not worry about huge time zone gaps.

This is also beneficial to Costa Rica-based employees, who can work day or mid-shifts instead of the graveyard hours.

Services that businesses can outsource to Costa Rica

The Costa Rican government has been highly supportive of foreign businesses, offering incentives and a stable business environment.

Many functions can be contracted to Costa Rica, but we’ve listed the top services that many businesses outsource here.

That said, you may use this as a quick introduction to the country’s outsourcing industry.

Customer services

From phone to email support, outsourcing firms can handle customer care activities in record time.

More often than not, external service providers offer this as one of their main services. This is to be expected as customer service is one of the busiest sectors to ever exist in a company.

Recruitment activities

The recruitment process outsourcing subsector has been seeing exponential growth.

Several industries need extra help hiring people, so it’s natural for businesses to turn to RPO companies. Recruitment activities are composed of candidate search, interviews, candidate management, and even a full-cycle recruitment process.

Virtual assistance

Virtual assistance has been a lucrative remote job for many people, but some companies have had trouble finding the right candidate for their requirements.

This is one of the reasons why VA companies exist—to guarantee that companies won’t have to endure hours of searching for the perfect virtual assistant.

Call center services

Contrary to popular belief, call center services are more than just customer care activities.

Telemarketing and telesales, as well as any other activities carried out over the phone, are part of call center services.

Due to Costa Rica’s large population of English-speaking and multilingual professionals, more and more companies are establishing their roots there.

Human resources

HR outsourcing garnered enough attention at almost the same time as RPO did.

While it might have been hard to get the ball rolling because of different labor laws in different countries, HR outsourcing professionals didn’t let that stop them.

From employee administration to basic HR functions, external service providers offer different activities and functions to assist their clients.

Software Development

Businesses can leverage the services offered in Costa Rica by outsourcing their software development needs to foreign companies operating in the region.

Costa Rica has become a hub for outsourcing software development due to its skilled workforce, competitive pricing, and reliable infrastructure.

The country’s strategic location, coupled with a strong emphasis on education and technology, makes it an attractive destination for outsourcing software development services.

Things to consider when outsourcing to Costa Rica

Most companies practice outsourcing to save resources or expand into new territory. To do so, you have to conduct extensive research and explore your options before settling into a choice.

Any major business decision such as this needs to be studied carefully, as there are a lot of factors in guaranteeing success.

Budget and resources 

While outsourcing is a cost-saving business strategy, it doesn’t mean that it comes cheap.

Generally speaking, major activities like this can be a bit expensive as they involve a lot of time and effort on the client’s side.

If the company’s decision-makers aren’t sure of the overall cost of outsourcing, it’s better to take a step back. Consult closely with the provider to know the options that can match your budget.

Scope of project

Outsourcing can be exhaustive because of its sheer size, but it doesn’t have to be. It can also be a seasonal thing, especially if the company only needs help for limited-time projects.

For instance, industries such as retail often need extra help during the holidays. Clothing stores may need extra customer service representatives to accommodate incoming inquiries from customers.

Time zone limitations

As mentioned, US and Canada-based companies often outsource to countries near their time zones to avoid big time zone gaps.

This is one reason why Central and South American countries are an outsourcing hotspot for North American businesses.

While time zone limitations can be remedied by adjusting work hours, some clients would prefer that outsourced employees aren’t pulling overnight shifts.

How outsourcing affects local economies

Outsourcing presents so many avenues and opportunities for growth, which is why most countries open up their economies to this business sector.

The impact of outsourcing on local economies, particularly in regions like Latin America, is significant and multifaceted.

Business process outsourcing, like the operations in San Jose, can bring both positive and negative outcomes to the area.

The Costa Rican tax system encourages foreign investment, creating a favorable environment for outsourcing businesses.

When outsourcing companies take root in a suburban area, this opportunity gives local businesses (e.g., food stalls, grocery stores, tourism, etc.) a whole new demographic to tackle.

This means that even on the smallest scale, external sourcing has always had the power to influence the economy.