Nearshore delivery remains largely based on providing business services in Latin America to end users in the United States. Beneath the surface, however, America’s nearshore is sprouting new service delivery paths.
Jamaica is increasingly becoming a hub for shipments to Canada and the UK. Central America is a preferred destination for customer support in Spain. And in Mexico, the country’s reputation for providing global services masks the reality that in northern border towns the nearshore process is accelerating and transforming.
While these emerging distribution routes connect several distribution destinations to a growing set of end-users across continents, two broad categories stand out.
[Shifts in delivery patterns] exist because contractors and their clients seek to capture the time-tested benefits of shipping from Latin America or the Caribbean amid changing global business models
The first of these includes a group of small native-English-speaking countries that include Jamaica, Guyana, Belize, Barbados, Saint Lucia, Trinidad and Tobago, and the Bahamas. Despite the small size of these nations, together they form one English which is bringing a rising wave of BPO investment. According to 2022 Ryan Strategic Advisory Front Office CX Omnibus Surveythese nations not only enjoy high levels of favor among CX decision makers in the United States, but they are also widely popular among those in Canada and the UK.
Each of these nations offers a workforce of English speakers and, most importantly, a shared common law tradition that provides familiarity for investors. Based on these strengths, contractors began investing aggressively in these markets in the wake of Great Britain’s referendum to leave the European Union. Initially, it was simply a way to ensure continuity of services despite the uncertainty and concern over the possibility of a “hard Brexit”. Soon, however, economic development agencies began helping to attract additional British investment.
Jamaica’s rise as a BPO destination is already on well known. So consider the recent advances made by Guyana. Over the past two years, 1,100 contact center jobs have been created, with the Guyanese investment promotion agency anticipating the addition of 1500 more jobs in this sector by the end of 2023. The result is likely to be more supply not only in the US but also in other English-speaking demand markets.
These shifts ensure a more diverse delivery footprint.
In contrast, the unique nearshore trend taking place in Mexico is decidedly more local.
Mexico offers unparalleled access, multi-city delivery options and other classic nearshore benefits. However, along the country’s northern border, these gains have accelerated. In recent years, a hyper close to shore has emerged connecting Mexican border communities like Tijuana and Mexicali with American businesses and end users in southern California, Arizona and throughout the wider Southwest.
Hyper nearshore represents an intensification of the nearshore paradigm. Instead of short flights, travel time is reduced thanks to the US Department of Homeland Security’s SENTRI program for frequent cross-border drivers. (Though, how New York Times noticed recently, the influx of Americans moving across the border to Tijuana is lengthening commute times for daily drivers.) And along border towns, cultural affinity melts into cultural fusion. This promises an unmatched degree of sensitivity in CX management for the growing number of contractors operating out of northern Mexico.
Granted, the basic social characteristics along the border have persisted for decades. Family ties run deep across international borders. What has changed is realignment of supply chains away from China and towards North America. Major infrastructure and logistics firms have moved to one side or the other of the border, fueling economic growth in the region. Together, the rising cost of housing in the US is causing many young Mexicans in border towns to stay put, even as many Americans join those living south of the border.
None of these emerging dispersal pathways appear likely to overturn classical nearshore dispersal. In many respects, they provide a study in contrasts. The only common denominator is that they exist because contractors and their clients seek to capture the time-tested benefits of delivering from Latin America or the Caribbean amid changing global business models. These shifts ensure a more diverse delivery footprint. And achieving that goal speaks to a dynamism within these nearshore markets that will help fuel future growth.
