The Benefits of Outsourcing to LATAM

Outsourcing services is not a new strategy. In fact, it’s a system that first emerged around the 1950s, looking to help businesses effectively compete by providing external resources, improving processes, and enhancing internal capabilities.

The services have since evolved, and, currently, 70% of companies affirm that the top reason for outsourcing is cost reduction. However, aspects like saving time, increased efficiency, reduced risk, and expanding service portfolios are some of the crucial reasons why companies outsource. 

However, the new challenges that arose during the pandemic have made this strategy even more popular so companies can be prepared in the face of another lockdown. Historically, the top countries for outsourcing services had been India and China, but now, nearshoring in countries in Latin America (LATAM) has taken the lead.

Let’s dig deeper into why LATAM countries have earned this position.

Expertise and hard-working talent

It’s not new news that LATAM workers stand out due to their agility, willingness, strong work ethic, and commitment to improving their technical resources.

Besides this, the educational levels are on the rise. For example, the number of college graduates in Colombia and Mexico has increased in the last few years, and governments are investing in nurturing engineers, IT professionals, and programmers.

Some cities in the region have even been listed as the future Silicon Valleys of LATAM, such as Medellin, in Colombia, Guadalajara in Mexico, and Santiago, in Chile. Mexico’s fintech ecosystem is also flourishing, and the Mexican population harbors fresh talent.


Providing a good outsourcing service requires digital infrastructure, stable internet, IoT objects that collect data, and communication tools for digitalization. LATAM governments and private companies have been steadily improving these aspects in the region, making cities like Medellín (Colombia), Santiago de Chile (Chile), Montevideo (Uruguay), Códoba (Argentina), or Guadalajara (México) hubs for digital nomads and a breeding ground for outsourcing.

Language skills

The English proficiency in LATAM has improved over the last two decades, possibly because official institutions desire more English speakers due to their plans to attract international investment.

The educational systems have also put more effort into having foreign language programs, from kindergarten to university, and people have shown more interest in learning and speaking other languages.

Time zone proximity

Let’s say that you have a marketing agency in New York that wants to outsource the sales team. It would impact your sales significantly if you had a team in a time zone with more than six hours difference. The quality of the company’s services and the delay in real-time responses to your customers would have an immediate outcome.

If you outsource to LATAM countries, they are often in the same time zone, reducing the hassle of early or late meetings, allowing quick resolutions to questions or complaints, and improving communication within the team.

Quality services at a low cost

Rates in the region are very competitive. LATAM outsourcing prices aren’t the cheapest in the market, but they are very affordable. According to the recently-released Stack Overflow Developer Survey 2021, the average annual salary of an engineer in the US is around $115,000. If a company outsources these services to a LATAM country, the same engineer can cost approximately $49,725. These numbers represent a more or less 40% cost reduction.

There are a growing number of reasons why outsourcing to LATAM is the best choice for your company. If you want to know more, click here.