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Pakistan – The Next Frontier of Global Outsourcing

Pakistan The Next Frontier of Global Outsourcing

Pakistan - The Next Frontier of Global Outsourcing

by Shanzeh Shunaid

In 2019, The Kearney Report validated Pakistan in the list of emerging digital hubs, alongside India, China, Philippines and others. So, is this country really the NEW frontier of global outsourcing? Let’s find out!

Pakistan has become the world’s new market-leader for BPO services. The World Bank’s ‘Doing Business 2020’ observed Pakistan making a tremendous 28-spot vertical leap since 2019. This means if your small or medium-sized business is seeking cost-effective BPO solutions, then now is the right time to outsource to Pakistan.

Pakistan – The Newly Reckoned Hub of BPO Services

Pakistan possesses an impeccable selection of BPO firms making it one of the biggest exporters of outsourced services among India, Russia, Mexico, and many others. A plethora of small and medium-sized companies from across the world are proactively approaching Pakistan to learn about the strengths and possible shortcomings of running a business over here.

One of the main reasons why Pakistan makes for an excellent BPO services exporter is because of its uber-adaptive IT industry. Small, medium and even seasoned IT ventures are quick at embracing the latest technological trends, and then incorporating them in real-life projects. Thusly enabling the BPO industry in Pakistan to expand exponentially.

The Prolific Business Environment of Pakistan

The business opportunities in Pakistan have observed an impressive growth. Between fiscal years 2016 to 2021, there has been a 17.8% increase in Pakistan’s IT exports. In 2021, Pakistani tech startups bagged up to $365 million and $223 million in just the first 5 months of 2022.  

In terms of the thriving BPO industry in Pakistan, there are more than 500,000 people working for leading BPO and IT firms. Global tech giants that were once skeptical about investing in Pakistan are now queuing up to bet on the newly-trusted BPO exporter. Pakistani tech companies have seemed to fully gear up to meet with the growing demand of BPO services in the global market.

 

Why Outsource Business Processes to Pakistan?

Whenever we talk about outsourcing business processes to offshore firms, our mind immediately steers towards countries like India, Russia, Argentina, Mexico, Colombia, China and the Philippines. There’s no denying that these countries have established themselves as leading BPO exporters. However, due to high saturation of BPO providers, it can be a challenge for foreign businesses to find the right service that’s not only budget-friendly, but also promises uncompromised quality every time.

Pakistan, on the other hand, proves to be a viable business process outsourcing location. Because of low saturation, foreign small and medium-sized businesses can easily find a reliable BPO provider that promises high-quality and consistency. Moreover, there are a few additional reasons that make Pakistan a worthy contender in the global BPO market, jotted below:

Cost

Low operation costs and increased profitability are some of the leading reasons for outsourcing. Pakistan has a lower cost of labor and operational equipment than other countries. In addition, technically sound and motivated Pakistani graduates are likely to demand salaries that match with their experience and expertise, providing a great opportunity for small and medium-sized businesses to avail high-quality services while gaining an economic edge.

As well as sporting high pricing flexibility, Pakistan has a relatively weaker currency with strong labor arbitrage opportunities. The current parity rate of one US dollar to Rupee is approximately USD 1 to PKR 207.51. Therefore, the overall estimated operational cost for US-based companies is likely to be reduced and become affordable.

Infrastructure

Pakistan is home to the world’s biggest IT industry backed by an ever-evolving business infrastructure. Regardless of the economic challenges, Pakistan offers a pro-enterprise regulatory-framework that fortifies BPO providers to invest in better talent. With good talent at hand, Pakistani BPO companies become capable of strengthening their grounds in the international market.

Time Zone

Pakistan is 12 hours ahead of the most U.S. states, giving it the benefit of “Follow the Sun” working model. The offshore team takes on the work during the client’s night-time and returns with results during work hours the next day. This round-the-clock model speeds up product development, reduces lags and enhances customer service.

Human Resources

With a growing population and a higher youth demographic, Pakistan has more than 186+ recognized universities and an estimated 1.6 million highly trained, skilled professional graduates passing out every year. The workforce consists of quick learners, capable of delivering efficient and robust business solutions. Proper and comprehensive hiring processes ensure that each team is made up of professionally dedicated individuals who abide by the deadlines and time zones of those hiring their services.

Adaptability

Another factor that earns Pakistan a point is its digital inclusion. The BPO firms working in the region have acclimated themselves to innovative technologies like artificial intelligence, machine learning, cloud computing, 5G wireless networks, and data science. Whenever there’s a new trend in the technological sector, Pakistani BPO providers are quick to adopt it to remain in-sync with the international market and to serve their international clients effectively.

Language Proficiency

And finally, let’s wrap it up with Pakistan’s language proficiency. An estimate of 27% of Pakistanis speak English as a first language, while 58% of the population speaks it as a second language. Pakistani BPO firms stay extra-vigilant while onboarding employees that are proficient English speakers and equipped with the ways of collaborating and communicating with international clients. All in all, the language barrier is the last thing a foreign business needs to worry about while obtaining BPO services from Pakistan.  

All Things Concluded

With unprecedented talent and resources, Pakistan is on the verge of overtaking the global BPO market. Pakistani BPO services have consistently excelled at providing highly tailored business solutions to international clients. In the coming years, outsourcing opportunities in Pakistan are likely to increase relative to its rival BPO exporters i.e., India and the Philippines as they are becoming increasingly expensive and quite average in terms of delivering high-quality services.

Blog Author

Shanzeh Shunaid

Shanzeh Shunaid

Shanzeh is the Founder and Director of SMB Services. She specializes in delivering sustainable back-end solutions to startups, small and medium-sized businesses, and loves watching them grow and thrive. 

Shanzeh has a Bachelor’s degree from Bryn Mawr and a Master’s degree in Business & Social Impact from the University of Southern California. She’s an avid traveler and spends most of her time between Silicon Valley, California, and Pakistan. During her spare time, you’ll find her sharing invaluable insights on the industry with our readers.

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Top 5 Accounting Software for SMBs in 2022

5-Top-accounting-software-for-SMBs-in-2022

5 Top Accounting Software for SMBs in 2022

by Husnain Kazmi

Accounting is built into the operations of every small and medium-sized business. The top accounting software for small and medium sized businesses (SMBs) helps you keep detailed, accurate books. Specifically, these programs generate useful reports, provide live support, integrate with your business apps and can accommodate growth. There are many accounting software with different features, but here are SMB Services’ picks for the best accounting software for SMB’s.

Top Accounting Software for SMBs

Best Overall Accounting Software: Intuit QuickBooks Online Software

A popular favorite for meeting SMB accounting requirements, QuickBooks Online offers online training resources and customer support forums. It is cloud-based software that can be accessed via web browser or a mobile application, presenting all its accounting features in one convenient dashboard. Customizations are possible, especially in how payments are received, reports are reviewed or business progress  is tracked.

QuickBooks Online offers an enhanced onboarding experience with improved dashboards and a well-designed user interface and navigation. The platform provides many customizable reports to choose from and is flexible, extensible and available to a wide variety of users. Their features include tracking expenses in one place, scanning and attaching receipts to invoices, exporting and sharing documents and tracking miles with data from mobile GPS. QuickBooks Online fully integrates with QuickBooks Payroll for seamless service provision. All payment plans allow for third-party integrations with Stripe, PayPal, Square, Shopify, and any other QuickBooks applications. However, users are encountering issues when working with multicurrency options on the software.

Intuit QuickBooks is a leading choice for SMBs as it is a tried and tested option, praised for its functionality and reliability. They have over 80% market share and have a diverse product range suited to help small businesses.

Best Free Accounting Software: Wave

For a small business that does not need payroll or complicated invoices, Wave is the ideal platform for bookkeeping, invoicing and reporting. Ideal for freelancers and service-based businesses, this free software offers functions like a double-entry system, data-backing for security, income and expense tracking, financial reporting, invoicing, and scanning receipts. For premium services like customer payment processing and payroll, there is an additional cost.

Wave has a smart selection of features, intelligent invoice and transaction management, and multicurrency support. It does not impose limits on transactions and billing, or on the number of business accounts or users that can be added. Wave offers simple record templates, no dedicated time-tracking feature and no comprehensive mobile application. This platform can be accessed via a mobile application but is limited by its lack of third-party integration.

This software is rated best for businesses with just a few employees, and those hoping to use free invoice and transaction management services. With ease of use and synchroneity prioritized, Wave is a powerful accounting solution for SMBs starting out.

Best Accounting Software for Service-based Businesses: FreshBooks

A service-based business requires invoicing as a matter of urgency. FreshBooks as a software offers more related functions and customizations than others. With intuitive navigation tools, it aids small and medium-sized business owners to send, receive, print, and pay invoices, track time spent on projects and handle basic bookkeeping needs. Described by Forbes as one of the easiest accounting software to use, FreshBooks (accessed via iPhone, iPad or Android devices) is designed for small business owners without accounting backgrounds.

FreshBooks is cloud-based and user-friendly, and popular as an affordable option for budget-tight projects. Their software has context-sensitive settings, team collaboration and time-tracking tools, and automatic mileage tracking on mobile applications. The invoices can be stylized and personalized according to the user’s preferences . More features include multicurrency and language billing, remembered vendors, recurring invoices with customizable options and payment reminders. This software integrates with third-party applications like Shopify, Gusto, Stripe, and G Suite.

SMBs should be aware that they do not offer payroll services but do offer excellent integration with a partner company called Gusto.

FreshBooks works best for businesses that need to send recurring invoices or that offer subscription models. With affordable plans and geo-tracking of invoices, this is software worth considering!

Best Accounting Software for Growing Small Businesses: Xero

This software is a good choice for small businesses that are looking forward to or are already growing. They need solutions with payroll capabilities that can also track projects. Xero has a cost-effective Starter plan, effective mobile applications and expandable capabilities. They also offer features like expense and inventory tracking and management for mobile applications, estimates, configurable reports, recurrent invoicing and simple budgeting options. Xero allows functionality with useful options to convert QuickBooks files, etc. This coupled with their 24/7 email and live chat support, makes for a user-friendly experience.

Unlike other accounting software on the market, Xero’s subscription plans support unlimited users. As your small business grows, more employees and users can be added without additional cost. A notable feature is Xero’s Executive Summary report that offers great flexibility in terms of date ranges, comparative periods and commentary text ability. This can then be passed on as a PDF, Excel spreadsheet or Google Sheet.

Xero touts more than 700 application integrations, with seamless access via iPhone, iPad and Apple Watch. For $39 per month, Xero offers the Payroll with Gusto as an add-on. However, their initial plans have limitations like a five invoice and twenty bank transaction reconciliation restriction.

Xero’s mobile experience is a leading characteristic, ideal for busy business people on the go.

Best Accounting Software for Medium Businesses Anticipating Rapid Growth: Oracle NetSuite Enterprise Resource Planning (ERP)

NetSuite is a cloud-based accounting software that provides intuitive financial management solutions. Designed to expedite a business’s financial transactions, monitoring accounts receivable and payable, NetSuite keeps track of SMBs compliance obligations. This software streamlines business operations with their full product suite that allows for real-time reporting and timely action.

Features offered include financial process and operations management, billing, financial planning and reporting, global account management and consolidation, and government risk and compliance. In addition to this, NetSuite also includes warehouse management, inventory auditing and multiple location management. By principle of being an ERP platform, NetSuite offers integrations with all accounting, inventory management, CRM and capital management modules. They also have a dedicated implementation team, available for an additional fee.

NetSuite is a top accounting software; however, it can be expensive for startups or small businesses. It is ideal for high growth small businesses and medium-sized businesses, for whom this integrated ecosystem saves time and money. This unified platform software works best when the available modules are used in conjunction.

Comparison of Top Accounting Software

FeaturesQuickBooksWaveFreshBooksXeroNetSuite
Free trialYesNoYesYesYes
Basic plan$25$20$6$12$999 licensing fee
Custom plansYesYesYesYesYes
Mobile AccessYesYesYesYesYes
Time TrackingYesNoYesYesYes
PayrollYesYesYesYesYes
Customer and Vendor PortalsNoNoYesYesYes
Inventory TrackingYesNoYesYesYes
Training AvailableYesYesYesYesYes
CRM IntegrationYesYesYesYesYes
24/7 live supportYesNoNoYesYes

Source: SAAS worthy 

Blog Author

Husnain

Husnain Kazmi

Husnain is Chief Operating Officer at SMB Services. Having spent 21 years specializing in Financial Accounting and Reporting, he has worked with leading accounting firms like EY. His degree of technical experience and professional competence makes any advice expressed a necessity for small and medium-sized businesses.

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Why Should SMBs outsource? Benefits & What to Look Out For

SMBs outsource and its Benefits

Why Should SMBs Outsource? Benefits & What to Look Out For

by Shanzeh Shunaid

Outsourcing is a business tool best known for its transformative potential, helping businesses gain the necessary skills to progress through their growth stages. 37% of SMBs outsource at least one of their processes, striking a balance between internal and external resources and maintaining steady functionality and quality control (Clutch). 

Trusting an external vendor to deliver on the essential processing needs of your business is a tough task. But with stronger checks for accountability, and reduced value leakage, twenty-four and a half percent of businesses increased outsourcing efforts or outsourced for the first time ever in 2021 (Capital Counselor).

Outsourcing has aided them in meeting growth objectives. Why are all industries adopting outsourcing with such frequency? What benefits of outsourcing are they hoping to gain?  

What are the Benefits of Outsourcing for SMBs?

According to Deloitte’s 2020 Global Outsourcing Survey, cost reduction is a leading cause for modern business outsourcing, with seventy percent of businesses partaking (Deloitte). Surpassing increased agility and better quality of service, this benefit is making business leaders prioritize outsourcing as a means of survival in the incoming pandemic-induced global recession.  

When not outsourcing, SMBs need to search for new talent and staff members, onboard them, train them, arrange and pay for their healthcare and benefits, payroll taxes, amongst other responsibilities. Businesses save precious resources by hiring an already formed and functioning expert outsourcing team, at a fraction of the expense of the former. The time, effort and capital saved can be better invested in more profitable avenues.  

The following are other benefits of outsourcing for SMBs. 

1. Optimizing Scarce Resources, Increasing Efficiency

Twenty-four percent of businesses stated increased efficiency as their reason for outsourcing, with sixteen percent championing better resource flexibility (Deloitte). Small and medium-sized businesses value their limited resources by outsourcing short-term contracts to external firms. This helps free up their resources to be deployed more flexibly, leading to higher productivity and greater utility. Overall, their bottom-line expenses are expected to decrease.  

Customers are demanding services that know no boundaries, and service providers that enable effective and viable solutions. Outsourcers are deploying software and technology with improved integration and compatibility. Optimal operational efficiency is possible when businesses are afforded the resource flexibility to see what works best for them. Outsourcing can ensure the continuity of operations and manage the risk of workforce overload for small and medium-sized businesses.   

With changing business scenarios, end-to-end supply chain hurdles, and greater geographical restrictions, outsourcing is the best means to stay adaptable.  

2. Focusing on Core Competency, Harnessing Growth Potential

Outsourcing job functions is more affordable than building one’s own in-house team. Investing in some operational processes like accounting, IT management, taxes, public relations, etc., have high risk potential for small and medium-sized businesses. In the case it does not pay off, they end up creating inefficiencies in their business model and hinder growth.  

Fifteen percent of small and medium-sized businesses outsource to free up work hours, and have more time to concentrate on future potential (Deloitte). Outsourcing can undertake responsibility for the completion of important but tedious tasks for a number of industries, like healthcare, transportation, retail manufacturing, insurance, etc. This frees up resources to be flexibly deployed in more profitable core activities, specific to the unique needs of their business. This will ultimately increase Return on Investment (ROI) and raise profitability.  

3. Accessing Expert Advice

Eighteen percent of small and medium-sized businesses outsource for the access it allows to a ready talented pool of experts and their many years of industry experience (Deloitte). Professionals are a valuable commodity to start-ups and businesses trying to navigate new markets, understand customers and set achievable goals.  

While an SMB may not be able to offer competitive packages to recruit top talent, outsourcing firms are capable of doing so, thereby giving access to expertise that delivers sound results. 

Hiring an expert outsourcing arm means assuring the quality of output, proportional to their years of experience in the industry. Service standards are reliably consistent and customers feel valued, further fortifying brand loyalty (Forbes).

Things to Look out for When Outsourcing

The following are aspects of outsourcing to consider before investing. 

1. Giving Up Control

While the SMB is directing what needs to be done and accomplished, outsourcing does make it difficult to maintain complete control of an enterprise and those who work for it. The outsourced service provider is neither on-site nor an employee, but rather a contractor. Therefore, an SMB will be giving up an aspect of operational control to an outside entity.  

Spend more time on the proposal and service provider selection process. Measures to safeguard interests would include vetting the company online, checking client reviews, their industry experience, software compatibility, case studies, etc. Curtail unnecessary risk by doing due diligence! 

2. Navigating Communication Issues

Communicating business needs and project expectations is the best way to get the most out of an outsourcing experience.

Internal

Before hiring an outsourcing arm or team, an SMB should inform in-house employees about the change. SMBs can ease the transition by communicating to their team the reason why this hiring choice has been made, how it will benefit them and their scope of work. This way, business reputation will be safe, employees will be happy to have expertise onboard and will appreciate the additional support so they can spend more time on the company’s core competency.

Keeping working relationships satisfied and their needs fulfilled is a sure means of getting the most out of an outsourcing experience.

External

Typically, SMBs outsource to offshore firms. This can include a time difference of anywhere between 2 to 10 hours. For there to be a successful working relationship, it is crucial that both must have an open line of communication, via a means mutually decided by both parties. The means of communication can include phone, email, instant messaging, video calling, amongst others. These are common business hours to connect, stay updated and address concerns.

Potential language barriers can also be a concern to a healthy working relationship. Common language and dialect are required to ensure the SMB’s needs are communicated, understood and fulfilled effectively. Without these, there will be a lack of engagement and miscommunication leading to lower service standards delivered.

3. Maintaining Quality Assurances

When businesses outsource, they look for a firm that understands and delivers on quality and deadlines. When onboarding a provider, there should be an agreement about quality controls and timelines and how they will be implemented. The ideal outsourced service provider will be responsible for regularly following up on deliverables, deadlines, meetings, feedback and complaints. As well as being mindful of the terms of the agreement as it pertains to job scope, quality assurances and deadlines.  

Else, SMBs outsource to the wrong partner, facing further issues like delays, additional costs and declining customer contentment.  

For the modern SMB, outsourcing is a must. The post-Covid competitive business landscape makes outsourcing necessary to survive and thrive competitively. They should outsource non-essential operations to firms, and take advantage of the flexibility and cost effectiveness that it avails them to scale upwards. Will your SMB be playing catch-up or leading the charge? 

Blog Author

Shanzeh Shunaid

Shanzeh Shunaid

Shanzeh is Director at SMB Services. A specialist in delivering sustainable solutions to those in need, she enjoys working on building startups from grass root levels. When not strategizing for core competency, Shanzeh shares her invaluable insights on the industry with our readers.

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Benefits of outsourcing at different growth stages of an SMB

Benefits-of-outsourcing-at-different-growth-stages-of-an-SMB

Benefits of Outsourcing at Different Growth Stages of an SMB

by Shanzeh Shunaid

Small and medium-sized businesses vary both in size and in their capacity for growth. They have different management styles and organizational structures, facilitating independent strategizing for future growth possibilities (Harvard Business Review). The benefits to be gained from outsourcing are the common factors uniting them, such as keeping costs low, meeting projections and surpassing planned goals.

With an external team handling non-core functions, SMBs are free to work on their core competency rather than other tedious and time-consuming tasks. They can prioritize duties without worrying about fast approaching deadlines, and explore new possibilities for value-added products and services. While the benefits of hiring an outsourced service provider are not in dispute, when to do so can be.

As an SMB grows, every stage of growth has its own set of demands and requirements. These are to be dealt with strategically to maximize the advantages of outsourcing for each.

The Stages of a Small and Medium-sized Business’s Growth

A small and medium-sized business progresses through the following stages of growth during its journey to maturity (Harvard Business Review). Outsourcing at each stage is a beneficial opportunity to focus on core competency, should the SMB choose to take advantage of it. Knowing when and where to use it can help owners, managers, employees, consultants and investors to make informed decisions and plans for the future.

1. Seed

The seed stage is the development phase of an SMB’s business lifecycle. Beginning the growth journey, the owner is testing out their idea for the business, researching its profitability, the industry it is hoping to serve and the trends guiding it (LinkedIn).

The SMB is developing and establishing its business structure and working on gaining market acceptance. The Seed stage is less likely to see outsourced operations unless business strategy necessitates it. If possible, it will be helpful in freeing up time, capital and labor to focus on bringing the idea and subsequent SMB to life.

2. Startup

The strategy of an SMB at the Startup stage is primarily concerned with surviving, attracting customers and delivering on the products and services they offer. The organizational structure consists of the entrepreneur or owner undertaking most responsibilities, and overseeing a small team. In this stage of growth, SMBs do not yet have standardized quality, established production or planned product transport. They are simply trying to gain customer traction, manage sales expectations and establish the product capability and market presence required to make it to the next stage (Business2Community).

At this stage, outsourcing can be a great resource given that the SMB is focused on developing their operations and building its team. It will allow the core team to focus on the initial development of products and services, building a customer base and navigating the market.

3. Growth

An SMB progressing to the Growth stage has proven itself as a workable business entity. No longer fighting for survival, they have a loyal customer base, and quality products with high demand. The organizational structure is simple with a small team and a manager, and the owner is still synonymous with the business.  The main point at this stage is navigating the relationship between increasing revenues and expenses. The SMB has to generate enough cash to break even, invest in maintenance and research and development to conquer a market niche. If they survive this stage, they will move on to the Expansion stage.

The Growth stage is the most fitting for the beginning of an outsourcing relationship. By now, the SMB has identified what essential core process further company goals, and which do not. Having broken even, they are navigating revenue streams, expenditure patterns and decisions of whether to begin investing back in the business (Business2Community). In order to continue to thrive and compete effectively, the SMB should outsource essential business processes, such as accounting, taxes and data analytics. The benefits of outsourcing these can allow sole focus on optimizing its core functions and maintaining low costs.

4. Expansion

The SMB is doing well, revenues are rising, the business is moving into new markets and researching, developing and adding products and services. A major decision for the owner at this point is whether to scale up and take advantage of this platform for growth, or remain profitable enough to support the owner’s side projects. If the former path is followed, the organizational structure can be decentralized and expanded to include new departments and hires. Systems become refined and extensive, and operational and strategic planning continue. If the latter path is taken, the business will remain stable, functioning in a comfortable ecosystem while other avenues are explored.

It is likely that the SMB has made it this far by managing its resources optimally and making the right choice between doing, delegating and outsourcing. However, if not already outsourcing business processes, it is not too late to make available more resources and capital to accelerate the focus on your core competency. The benefits of outsourcing at the Expansion stage will be a catalyst for scaling operations onwards and upwards!

5. Maturity

Having successfully survived and expanded, an SMB at this final stage of growth is a dedicated market leader. The business is expected to continue growing, at a slower pace than before, navigating new markets and more value-added offerings.

SMBs now have the option to further expand or consider an exit strategy. The benefits of business process outsourcing at this stage include increased efficiency and access to industry-leading expertise.

Every stage of the growth journey of an SMB brings with it a novel set of challenges. Strategies, business plans and operations should be adjusted according to the unique needs of each. Outsourcing is a proven and sustainable benefit to the business model at all points. Success is in correctly delegating tasks to internal teams and outsourcing firms, making a viable combination of the two is the difference between progressing to the next stage of growth or remaining stagnant.

Blog Author

Shanzeh Shunaid

Shanzeh Shunaid

Shanzeh is Director at SMB Services. A specialist in delivering sustainable solutions to those in need, she enjoys working on building startups from grass root levels. When not strategizing for core competency, Shanzeh shares her invaluable insights on the industry with our readers.