Is the future bleak for Virtual Assistants in North America?
Posted by Craig · 9 Comments
I want to feature another business challenge put forth by one of our subscribers:
The growing challenge of offshore competition
This has become a topic of interest across a number of blogs, so I thought I would attempt to tackle this one myself!
I am not sure if you have accounts at Elance or Guru, but it is a known fact that Western Virtual Assistants ( residing US, Canada, UK, Australia etc….) are competing against $2-$5/hour VAs in such countries as India and the Phillipines. It is also a known fact that more and more companies are starting to outsource internationally in order to cut costs and grow their profits. So in light of these trends, what is to become of Virtual Assistants in places like North America, UK and Australia – will they simply not be able to compete in this new global marketplace?
I am sure this concern has crossed the mind of many VAs especially if they are browsing Virtual Assistant profiles in Elance and Guru. Well, there is HOPE and let me tell you why…
The Virtual Assistant industry while technically founded in 1995 (by Christine Durst) is still a relatively new industry. Stats have estimated there are currently about 20,000 Virtual Assistants working worldwide. However, that is a very small number considering the increasing amounts of small and medium sized businesses seeking to hire Virtual Assistants over the next couple years. It is estimated that by 2009, 80% of all small and medium businesses will have a web-presence and be marketing online – that is over 20 million companies! Many of these companies will be building Virtual Teams in order to manage their business and online efforts. It is predicted that there won’t actually be enough Virtual Assistants to meet the demand!
Furthermore, based on my own experience in outsourcing internationally and in-country, there will always be certain tasks that are better suited to a western Virtual Assistant. For example; in a previous company I worked with, we had hired a Virtual Assistant to research, recruit and manage affiliate partner relationships. This individual was required to keep regular North American hours and converse on the phone with partners. We would not have outsourced this virtual position internationally. There are many more examples. The reality is that there will always be a certain part of the business population that prefers a more local virtual presence as opposed to offshore VAs. So, while outsourcing offshore is on the rise, so is the potential client base VAs can market to!
Secondly, there are oodles of opportunities for Virtual Assistants to establish in-demand niches and become specialists in such areas as Blogging, Social Media, Shopping Cart Set-up, Autoresponder management and so much more! I firmly believe that those Virtual Assistants who continue to adapt their business and tap into new “in-demand” niches will thrive even in the midst of growing offshore competition. Personally, I would much rather hire a “Specialist VA” at a higher hourly rate to accomplish a particular task as they will likely take less time and be more proficient.
Michael Russer, author of The Obsolete Employee, says “…To be consistently successful as a VA, one needs to specialize rather than run ragged trying to be everything to everyone.”
This is key – the important piece is to know what tasks are in demand and what to specialize in. There is a BIG market for VA Specialists – Blogger VAs, Social Media VAs, Online Event Planner VAs, Affilate Marketing VAs… the list goes on.
Finally, there is an unprecendented number of networking opportunities for Virtual Assistants to connect with their target audience through such sites as Linkedin.com, Facebook Groups, Ryze and so much more. This is networking on steroids! Those virtual assistants that consistently tap into these many targeted networking channels online and build a rapport with the small/medium business community will position themselves well for a steady stream of new clients and income opportunities.
Futhermore, it is essential that Virtual Assistants also educate local businesses on the immense value of hiring virtual staff. There is certainly good value in connecting with local business associations to raise awareness as well. I firmly believe that if you can market and network well, you will never have a shortage of work, irregardless of the offshore outsourcing trends.
This is a very interesting topic – please join the discussion! I would be interested to get your own personal take and feedback on the whole offshore Virtual Assistant trend.
I really admired the fact that you’ve chosen to tackle this seemingly threatening issue of international VA’s undercutting many wester VAs in the current marketplace. However, I would like to address a few concerns regarding the ‘limits’ on what can be outsourced to international VAs.
I personally work with a number of global team members, including an individual in the Philippines that is essentially in charge of running my entire web design business (he works with new clients in quoting and planning their projects, coordinates the global design team in getting the project done, and deals with customer service along the way). He also handles a number of other things related to the business.
In regards to your note of your apparent limitation noted in your posting that “This individual was required to keep regular North American hours and converse on the phone with partners”, I need to make clear my experience with these exact ‘limitations’. My virtual assistant works from 9am-5pm US PST, converses regularly with US based clients via phone with the clients never even thinking that they’re speaking to a foreign provider (his communication is that good), and he does literally everything that I used to be in charge of with my business. In summary, I’ve outsourced MY position in the company so that I can concentrate on the things I enjoy in life (surfing, building other businesses, completing my university marketing degree, etc.).
What I’m really trying to get at with this replyto your posting is that I disagree that there are certain aspects of the VA tasks that clients need to keep local. I firmly believe that we’re now working in a global community that is getting smaller culturally by the day. I’m fortunate enough to be able to take advantage of the ridiculously low hourly rates with professional quality still ever present, but I feel that the rest of the business world is going to quickly catch on to the opportunity to hire individuals that measure up to USA providers for a small fraction of the cost.
Personally, I am not worried about the $2-$5/hour VAs and don’t have time to go through profiles of other VAs on elance. I network with many virtual assistants all over the world on a daily basis and have never had a conversation with any of them regarding this topic. Nor, have I met anyone who is worried about this or feels threatened. I feel that anyone who has marketable skills and can do the job deserves a shot at it…Why wouldn’t they? I would never place a geographical boundary for my business on clients or for outsourcing my own tasks.
Well said Frances. I agree that anyone that has the marketable skills and can do the job deserves a shot at it. I’m always looking for new VAs that are able to handle the tasks that I need handled for my various business ventures.
I’ll definitely continue to keep an open mind on where I find my VAs and the tasks that they can handle.
Regards
I sometimes wake up at night worried that I’ll not have work the next week to feed my kids.
So I keep trying to learn more about online business concepts and giving my clients huge value so they keep me busy.
I guess even a VA like me (in USA) should be prepared to offload some of my tasks that can be done more cheaply elsewhere… and not feel I should hang on to them.
In fact the more I can outsource the better, as it makes me more profitable and I can be more competitive.
It’s just worrisome sometimes, but you can’t be complacent in any job these days. Training is important for us all no matter what country we’re in I guess.
Thanks – Mary
I would concur with all that the global marketplace is a great thing! As a world, we are becoming more closely interconnected then ever before, which is awesome!
I would again emphasize that the sheer demand of Virtual Assistant opportunities emerging over the next 5 years will mean excellent potential for both Western and International VAs alike! As you have mentioned, I can certainly see a growing trend of Western VAs offshoring certain tasks to International VAs in order to grow their businesses at a faster rate.
I do want to address the one concern I have about the promotion of the $3 VA. Naturally small/medium businesses are always looking to keep their costs low and profits high! So, when businesses hear about the prospect of hiring a VA for $3, their mindset naturally shifts to how much money they can save as opposed to ensuring they have the best fit for their current project or position.
One of my Internet Business Colleagues outsourced his customer support to a offshore team for less than $5/hour and he admitted after that the training process was more extensive and time consuming then he envisioned. He said that as a result they experienced some delays in launching certain parts of their business. Now, again, I am not wanting to make a sweeping generalization that offshore VAs take longer to train. The point I want to convey is that businesses need to strike the balance between cost and quality, otherwise they may end up in a less than desirable situation.
Thanks for all the comments – keep them coming!
My experience with off-shore VA’s has definitely been mixed. In most cases I’ve encountered so far, I have run into training times that have well exceeded those for most of the on-shore VA’s that I’ve dealt with.
To work around that, we’ve started to use training video tutorials to clearly outline strict processes that the VA’s need to follow. We’ve seen much better results with that approach, and I now try to stay away from lengthy emails to explain a change of procedure or task.
The significant savings involved with using off-shore VA’s simply cannot be ignored. HOWEVER I’ve also learned that some tasks simply require a level of expertise that seems to be harder to find in the off-shore market. Until that changes, I will always be looking first to domestic sources for personnel to fill some roles.
Hi Craig,
thanks so much for the post. In the opening issue of my VA newsletter I address this briefly. In my opinion, VAs are not the only ones dealing with lower-wage global competition. My advice to U.S. based VAs is to develop a niche (mine is technical), set a price you can live with and play up your strengths as a domestic – proximity, language, etc. I’m also an Elance provider and have successfully been able to win over lower-wage international providers time and again!
Tia Peterson’s last blog post..Self-Employed Moms Mastermind Group
Thanks for your comments Tia! I concur that the key to long-term success as a VA is to identify and pursue the right types of niches or specializations for your business. I also believe that implementing the right kind of innovative marketing strategies can maximize your business exposure and set you apart from the competition.