Why Do Companies in Hong Kong Choose to Hire Offshore?

Have you ever wondered why so many companies in Hong Kong leverage on hiring offshore? It’s not just a trend; it’s a strategic move that enables businesses to grow while staying efficient and cost-effective. Let’s dive into the key reasons why offshoring is a significant advantage for employers seeking professional services.

1. Reasonable Service Costs to Cut Operating Expenses

Offshoring offers Hong Kong companies a strategic way to reduce operational expenses, particularly in office space rentals. By moving certain operations to regions with lower rental costs, businesses can save significantly while maintaining quality. These savings can then be reinvested in growth areas such as innovation and market expansion.

Comparison of Office Rental Costs

• Sheung Wan, Hong Kong:
  • Grade A office space: HK$74 per square foot per month (USD 9.50).
  • 1,000-square-foot office for 10 employees: HK$74,000 per month (USD 9,500).
• Kuala Lumpur, Malaysia (KLCC):
  • Prime office space: MYR 8.00–10.00 per square foot per month (USD 1.70–2.10).
  • 1,000-square-foot office for 10 employees: MYR 8,000–10,000 per month (USD 1,700–2,100).
• Potential Savings: Up to 80–85% in rental costs by choosing Kuala Lumpur over Sheung Wan.

Coworking Space Comparison

• Hong Kong:
  • Hot desks (The Hive): HK$2,500 per month (USD 320).
  • Private offices: Starting at HK$8,000 per month (USD 1,030).
• Kuala Lumpur:
  • Hot desks (Common Ground): MYR 399 per month (USD 85).
  • Private offices: MYR 1,200–2,500 per month (USD 255–530).
• Potential Savings: 60–75% lower coworking costs in Kuala Lumpur.

This stark contrast in office space costs makes Kuala Lumpur an attractive destination for Hong Kong companies seeking to optimize operations. Offshoring to Malaysia not only reduces expenses but also allows businesses to tap into a skilled workforce and reinvest savings into long-term growth and competitiveness.

2. Sizeable and Digitally Literate Workforce to Support Operations

Offshoring provides access to a global talent pool, with countries like Malaysia, Philippines, and India offering tech-savvy workforces capable of handling tasks from customer service to complex back-office operations. These regions produce thousands of skilled graduates annually, ensuring Hong Kong companies have access to quality talent.

Malaysian Chinese talent is especially well-suited for Hong Kong businesses. With fluency in Cantonese, Mandarin, and English, they bridge cultural and linguistic gaps, making them ideal for customer-facing roles and cross-border communication. Combined with Malaysia’s strong technical education, they help maintain quality standards while seamlessly integrating into Hong Kong’s business environment.

3. Enhanced Online Infrastructure for Efficient Communication

With good internet and digital tools, offshoring destinations means communication is seamless. No more worrying about time zones or lagging connections, teams can collaborate in real time, no matter where they are. Offshoring feels like working with a team next door.

4. High English Fluency for More Effective Customer Interaction

Good communication is the foundation of any business. Countries like Malaysia, Philippines and India are high in English proficiency so communication with customers is clear and effective. Whether it’s resolving issues or making sales, language won’t be a problem.

5. Compatible Cultures for Greater Customer Relationships

Cultural alignment is a big factor in building relationships. Many offshoring destinations have similar values and work ethics to Hong Kong businesses so collaboration is smoother and more productive. This alignment builds trust and respect, two key ingredients for success.

6. Supportive Governments to Spur Offshoring Operations

Governments in popular offshoring destinations actively encourage foreign businesses. From tax incentives to streamlined regulations, they create a business-friendly environment that makes it easier for companies to set up and thrive.

7. Stable Economy to Support Business Growth

Stability is crucial for successful offshoring. Economies like Malaysia offer a reliable foundation with political stability, steady economic growth, and a business-friendly environment. This ensures a secure setting for long-term partnerships, allowing businesses to confidently plan for the future while benefiting from cost efficiency and access to skilled talent.

8. Flourishing BPO Industry VS Dedicated Offshore Team

The Business Process Outsourcing (BPO) industry in many offshoring destinations is growing. With years of experience and an established ecosystem, these regions can handle everything from call centers to data processing with expertise and professionalism.

However, building your own offshore team offers greater flexibility and control. Unlike relying on BPO providers, having a dedicated offshore team allows companies to align operations directly with their business goals, maintain tighter control over processes, and foster a stronger sense of team culture. This approach ensures a more tailored and integrated workflow, delivering long-term value and scalability while still benefiting from cost efficiencies.

9. Flexible Work Shifts to Ensure Constant Customer Service

Offshoring allows businesses to offer 24/7 support, ensuring customer satisfaction around the clock. If round-the-clock service is a priority, it’s essential to build teams in multiple time zones to cover varying shifts effectively.

However, if your business only requires support during normal working hours, the Asia-Pacific region is an ideal choice. With its skilled workforce, cultural alignment, and overlapping time zones with Hong Kong, Asia-Pacific destinations like Malaysia, Philippines, and India can efficiently meet your operational needs during standard business hours.

10. Reduced Legal and Management Obligations to Save Money

Managing in-house teams often comes with legal and administrative complexities, from compliance with labor laws to managing payroll and benefits. Offshoring simplifies these challenges by allowing businesses to outsource these responsibilities, saving on compliance and management costs.

For even greater efficiency, companies can utilize Employer of Record (EOR) services. An EOR handles all employment-related tasks, including hiring, payroll, taxes, and legal compliance in the offshore location. This enables businesses to focus on their core operations while ensuring all local regulations are met seamlessly, further reducing administrative burdens.

11. Healthy Work Qualities for Maximum Efficiency and Productivity

Employer of Record (EOR) providers ensure employee welfare by managing competitive salaries, benefits, and a conducive work environment that enhances productivity. By prioritizing employee satisfaction, EOR services help create a motivated workforce, leading to better performance, higher retention rates, and improved outcomes for your business.

12. Core Business as the Primary Focus to Gain a Competitive Edge

By offshoring non-core tasks, companies can focus on what matters, innovation, growth and delivering value to customers. This strategic approach allows businesses to work smarter, not harder, by streamlining operations and dedicating resources to their core strengths and long-term goals.

13. Scalable Operations for Improved Cost Control

Offshoring provides the flexibility to scale operations up or down as needed. Whether you’re launching a new product or entering a new market, you can adapt quickly without breaking the bank.

How FastLaneRecruit Can Help

At FastLaneRecruit, we understand the unique needs of businesses in Hong Kong. With our professional services, we make offshoring simple, efficient, and tailored to your goals. From offshoring hiring to recruitment services, we’ve got you covered. Ready to explore the benefits of offshoring? Let’s chat and see how we can help you achieve more with less effort. Contact us today!