Pros & Cons of Outsourcing Product Information Management

Posted on:
August 15, 2023
10
min read
Table of Contents
1
What are the benefits of outsourcing to developing countries?
2
What are the challenges of outsourcing to developing countries?
3
Top 5 Most In-demand Developing Countries for Outsourcing
4
What are some successful examples of companies that have outsourced to developing countries?
5
What are the best practices for outsourcing to developing countries?
Pros & Cons of Outsourcing Product Information Management
KDCI Outsourcing
September 6, 2023

Product information management plays a crucial role in your business. The data that you put out about your product affects the purchasing decision of your customers. Publish one wrong detail about what you offer, and your brand reputation is already at risk.In fact, about 88% of businesses in the US experienced the negative effects of inefficient product information management in 2022.Many businesses struggle with their product information management (PIM) due to the amount of time and effort it takes. That’s why it comes as no surprise that more and more businesses are now looking to outsource this function. If you’re reading this article, you may also be considering doing the same, so let’s walk you through the pros and cons of outsourcing PIM so you can make an informed decision when deciding whether to push through with this business strategy.

What Are the Benefits of Outsourcing Product Information Management to the Philippines?

Outsourcing product information management has been a preferred strategy by many companies that want to make their business operations more efficient yet less costly. Take a look at some of the benefits associated with outsourcing the function to the Philippines.

Global Compatibility

The Philippines is known for its multilingual workforce. Many Filipinos are proficient in multiple languages, including English, Spanish, Chinese, Japanese, and more.If your business caters to a global market or requires product information management support in multiple languages, outsourcing to the Philippines can provide access to a diverse talent pool that can meet your specific requirements. This will also help brick-and-mortar businesses that want to improve their stock keeping unit (SKU) management, allowing them to easily view how a product is performing in several locations.

Access to a Skilled Workforce

Beyond data management, the Philippines has a vibrant creative industry and a talent pool with expertise in marketing, graphic design, and content creation. When outsourcing product information management to the Philippines, you can leverage the creative skills of professionals who can enhance your product descriptions, optimize images, and create compelling content that drives customer engagement and sales.You can also take advantage of Filipino professionals’ attention to detail, precision, and adherence to quality standards when it comes to accurate and consistent SKUs throughout your product catalog.

Time-to-Market Advantages

The Philippines' geographical location enables businesses to gain time-to-market advantages. It is strategically positioned to provide timely support to Western markets due to its proximity to time zones, particularly for businesses in North America.By outsourcing product information management to the Philippines, you can expedite product launches, updates, and promotions, ensuring faster response times and staying ahead of the competition. In addition, the strategy will let you update your SKUs more efficiently every time you plan a new product launch.

Proximity to Asia-Pacific Markets

If your business targets the growing Asia-Pacific markets, outsourcing product information management to the Philippines offers geographical advantages. The Philippines serves as a gateway to the region, with its proximity and cultural understanding of various Asian markets. This can help you tailor your product information and marketing strategies to effectively target and engage customers in the Asia-Pacific region.Moreover, as it’s difficult to keep up with SKU management if you’re working on high production volume with multiple manufacturers, outsourcing product information management to the Philippines will save you a lot of time in tracking and monitoring your partners in Asia-Pacific.

Immense Government Support and Incentives

The Philippine government actively promotes the outsourcing industry and provides support through initiatives and incentives. This includes establishing dedicated economic zones and offering tax incentives for outsourcing companies.The government's commitment to the industry helps create a conducive environment for outsourcing product information management and encourages the growth and development of outsourcing providers in the country.

What Are the Drawbacks of Outsourcing Product Information Management to the Philippines?

Because of factors like the outsourcing provider, the quality of service provided, the gap between the Philippines and the company’s home country, and other unforeseen circumstances, several drawbacks come with outsourcing. Below is a list that you can refer to.

Infrastructure Limitations

While the Philippines has made significant investments in building its IT infrastructure, certain areas or regions within the country may still face limitations. These limitations can include intermittent internet connectivity, power outages, or technological constraints. It's important to assess the infrastructure capabilities of your chosen outsourcing provider and ensure they have adequate backup systems and contingency plans in place to minimize disruptions.

High Turnover and Attrition Rate

The outsourcing industry in the Philippines is highly competitive, leading to a relatively high turnover rate in some cases. Attrition and staff turnover can potentially impact your PIM operations, requiring you to invest additional time and resources in training new team members. It's important to discuss retention strategies and employee engagement practices with your outsourcing partner to mitigate the effects of turnover.

Intellectual Property Issues

Intellectual property (IP) protection is a concern when outsourcing PIM to any location, including the Philippines. While reputable outsourcing providers prioritize data security, there may still be concerns about the protection of proprietary information and product details. It's essential to have strong non-disclosure agreements (NDAs) and confidentiality clauses in place. You should also conduct due diligence on the outsourcing partner's track record in IP protection.

Language Nuances and Localization Challenges

While Filipinos have strong English language skills, there can still be language nuances and cultural differences that impact localization efforts. Depending on your target market, ensuring accurate translations, culturally appropriate content, and localized product information may require additional oversight and coordination. It's crucial to establish clear guidelines and processes for localization to ensure that your outsourced team understands and meets your specific requirements.

Complex Knowledge Transfer Process

Outsourcing PIM to the Philippines means sharing knowledge about your products and industry with the outsourced team. It may take time and effort to ensure that the team develops a deep understanding of your products, target audience, and industry-specific nuances. Effective onboarding, training, and ongoing knowledge-sharing initiatives are essential to bridge this knowledge gap and maintaining consistent quality in your PIM processes.

Who Should Outsource Product Information Management to the Philippines?

Outsourcing product information management definitely comes with a lot of pros, but it’s not for everyone. There are certain businesses that can benefit from this strategy, including the following.

Small and Medium-Sized Enterprises (SMEs)

SMEs often have limited resources and may not have dedicated teams or expertise to handle PIM effectively. Outsourcing PIM allows them to access specialized skills and experience without the need for significant investments in hiring and training in-house staff.

Ecommerce Businesses

Online retailers that manage large catalogs with constantly changing product information can benefit from outsourcing PIM. The Philippines has a significant presence in the e-commerce industry, making it a suitable outsourcing destination for PIM needs, including data entry, catalog management, and content creation.

Companies with Global Operations

Businesses that operate in multiple countries or target international markets can leverage outsourcing to the Philippines for PIM. The country's multilingual capabilities and cultural affinity with Western countries make it well-suited to handle diverse language requirements and localize product information effectively.

Companies Experiencing Rapid Growth

Businesses that are experiencing rapid expansion may find it challenging to keep up with the increasing demands of PIM. Outsourcing allows them to scale their operations quickly, tap into additional resources, and maintain efficient PIM processes while focusing on core business growth.

Companies with Seasonal or Fluctuating Demands

Industries that experience seasonal fluctuations in product lines, promotions, or sales volumes can benefit from outsourcing PIM. The flexibility of outsourcing enables them to adjust resources and capacity according to their changing needs, ensuring efficient management of product information during peak and off-peak periods.

Companies Aiming for Operational Efficiency

Organizations seeking to streamline their operations, improve productivity, and reduce overhead costs may find outsourcing PIM to be a viable solution. By delegating PIM tasks to specialized professionals in the Philippines, they can focus on their core competencies and strategic initiatives.

Outsource Your Product Information Management Needs to KDCI

Are you looking for a trusted outsourcing partner for your product information needs? Work with a service provider in the Philippines who can design and execute the best outsourcing strategy for you!At KDCI, we offer a full-package product information management service to help businesses stay on top of the Ecommerce game. We’ll build you a team of PIM specialists who have marketing and SEO background. These marketplace experts will write effective product descriptions, curate your Amazon listings, keep your product data up to date, and manage your product catalog.Rank well and convert in marketplaces through our comprehensive product information management services. Click the button below to contact uContact Us

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