A comprehensive guide to outsource to Brazil

Why do companies outsource to Brazil?

Companies outsource to Brazil for its skilled workforce, low costs, near-US time zones, and strong cultural fit.

• The country sits close to the US, so teams work in near-matching hours.
• Living costs run far below US levels, which lifts client savings.
• Brazil is strong in software development and call center services.

Many global businesses now hire remote and outsourced workers from lower-cost countries. As a result, several outsourcing hubs keep gaining ground with firms of every size. One rising strategy is the choice to outsource to Brazil.

Brazil is one of the world’s up-and-coming outsourcing destinations. The country has grown steadily since the late 2000s. Along the way, it set out to compete with India in outsourcing. It is also one of the leading hubs for outsourcing to Latin America.

The Brazilian outsourcing industry is still young. So it has plenty of room to expand and match today’s top hubs. Even so, companies still choose Brazil for its cultural fit and low costs. Below, we cover the country, its outsourcing climate, and why firms pick it.

Quick overview on outsourcing to Brazil

Brazil first grew as a base for call center work over the past two decades. In fact, its economy and call centers grew even during the 2008 global financial crisis.

From the start, Brazil aimed to compete with India in offshoring. Since then, it has mixed the economic traits of China and India in how it does business.

The country moved from tenth to fifth top offshoring hub in just two years, from 2005 to 2007. During this era, the shift away from “traditional” locations began.

In 2010, six Brazilian cities made the Tholons Top 100 Outsourcing Cities: Sao Paulo, Curitiba, Rio de Janeiro, Brasilia, Recife, and Campinas. Two years later, Sao Paulo became the top Latin American outsourcing hub.

Over time, Brazil reached the top three in Tholons Digital Nations, behind India and the Philippines. It has stayed near the top of that list since. Despite some ups and downs, the country remains a solid choice for software development and call center services.

Brazil fast facts

Here are some key facts about Brazil:

• BRICS. Brazil was a founding member of BRICS (Brazil, Russia, India, China, and South Africa) in 2001. These “big four” economies are set to shape the world economy for decades.
• Language. Many people confuse Brazil with its Spanish-speaking neighbors. In fact, it is the only Latin American country that speaks Portuguese.
• Connection with Japan. Brazil has a long-time trading connection with Japan, dating to 1908. It is also home to the largest Japanese community outside Japan.
• Largest carnival. The country holds one of the largest carnivals in the world, drawing millions of people.
• Coffee. Brazil has been the largest producer of coffee in the world since the 1840s.
• English proficiency. The country ranks 53rd out of 100 in the EF English Proficiency index.

Why do companies outsource to Brazil?

One big factor is location. The country is only about an hour ahead of the US, though flights can take six hours. Because of this, real-time work with US teams is easy.

As the largest country in South America, it also makes a strong delivery base. In many ways, it offers the nearshore edge you get when you weigh offshore versus onshore staffing. Aside from this, firms choose Brazil for the reasons below.

A growing quality workforce

The Coursera Global Skills Report 2023 named Brazil the third leading country in Latin America for business, tech, and data science skills. It also ranked 28th worldwide in that category.

Brazil produces millions of graduates from top universities each year. In fact, the Brazilian labor force was reported at around 98 million and has since grown past 108 million. As a result, there is a deep and growing talent pool.

Impressive infrastructures

Strong infrastructure is a key benefit of outsourcing to Brazil. The country has around 90 technology parks and 35 accelerators built in recent years.

It also has many research centers, tech firms, and institutes. Some sit in Brazil’s Silicon Valley in Campinas. These gains come in part from “Lei do Bem (Law of Good),” which gives tax breaks to firms that invest in research and new technology.

Low costs and increased profits

Firms that outsource to Brazil save a lot and boost profits. This is largely due to the low cost of living.

Recent data shows the cost of living in Brazil runs about 52% lower than in the US on average. However, costs shift by region and city. For example, large cities like Rio de Janeiro tend to cost the most.

Even so, this is a clear win for US and European clients. That is because the average wage is still lower than in developed countries.

Suitable laws and regulations

Brazil passed its breakthrough outsourcing law in 2017. It also has a fairly stable political climate and an improving business culture.

The Political Stability Index 2023 placed Brazil ahead of India and the Philippines. The government also works to strengthen the business system and grow the outsourcing sector. In addition, it enforces strict data rules for local and foreign firms through the General Personal Data Protection Act (LGPD).

Exceptional team collaboration

Firms that outsource to Brazil enjoy smoother teamwork with remote staff. As noted, Brazil is only up to a few hours ahead of the US.

Because of this, US clients can reach teams by phone or by tools like Zoom during office hours. What’s more, Brazilian graduates learn English from a young age. So communication stays easy for both sides. Finally, future workers learn about US work culture, which makes the country a strong cultural fit.

Services to outsource to Brazil

IT and software development

First, Brazil is known for software development and IT outsourcing. As noted, the government backs local and global tech and research firms.

The IT industry in the country is worth billions of dollars and keeps drawing outsourced work. In Curitiba, for example, clients can hire developers skilled in Python, IoT, and system migrations. For a fuller view of the model, see our guide to software development outsourcing.

Contact center services

Another in-demand service is contact center work. Some of the largest call center firms in Latin America run big teams in Brazil.

In turn, these centers help grow the economy and improve local lives. Brazil suits English and bilingual contact centers well. It supports inbound and outbound calling, telesales, and lead generation.

Manufacturing

Finally, Brazil can compete with China and others in outsourced manufacturing. Raw materials cost less here than in the US.

As a result, high-quality OEM firms have stayed in demand for years. They also avoid heavy export fees and taxes thanks to the Information Technology Law of 2001. Multinationals such as Kodak and Lucent have used contract manufacturing to tap these gains.

Brazil’s outsourcing competitors

Here are the top three competitors of Brazil. It also draws comparison with hubs like Vietnam in Asia.

1. Puerto Rico

Puerto Rico is a strong nearshore and onshore choice for US firms. As a US territory, it follows US laws and rules. It ranked 74th in Tholons in 2016, then jumped to 47th the next year.

2. China

China is one of Brazil’s closest rivals in outsourced manufacturing. Leading tech firms, including Apple and Samsung, work with it.

However, Brazil holds an edge on English skills. China still has work to do here, which limits its fit for contact centers.

3. El Salvador

Finally, El Salvador edges Brazil on experience. Its industry is almost two decades old and strong in customer service and software development. Its perks include 50 to 60% cheaper costs and a close cultural fit with developed countries. For another Latin American view, see this Colombia versus the Philippines comparison.

Top BPO companies in Brazil

BPO companies in Brazil can help you reach customers and serve them well. Here are some of the top firms you can hire.

1. Aidey

Aidey offers flexible, low-cost help for customer service, technical service, and back-office work.

2. JobHome

JobHome is a cloud-based call center firm. Clients can hire distributed teams on a co-managed plan and track them through the cloud.

3. Conduent

Conduent is one of the largest business process firms in the world. It serves both government and private clients.

4. Neobpo

Neobpo blends CX, UX, and design thinking to give clients the best experience.

5. Central 24 Horas

Central 24 Horas mixes hardware and software to build fast, flexible solutions for clients.

Is it good to outsource to Brazil?

Despite the many perks, firms can still hit a few snags in Brazil. These include:

• Taxes. Taxation in Brazil can be confusing at times, above all for foreign investors.
• Language barrier. A language gap can still exist, so plan for it early.
• Changing regulations. Laws can shift fast, so firms must stay updated.

Like any hub, Brazil takes some effort and resources to set up. So many clients seek advice from experts and third-party consultants.

Outsource Accelerator, the world’s leading outsourcing marketplace and advisory, can help here. We host thousands of articles and podcast episodes so clients can learn before they leap. In addition, we list thousands of BPO firms in our directory so you can contact your preferred BPOs directly.

In the end, there is little harm in trying a hub like Brazil. It may even help you scale and meet future needs.

Outsourcing to Brazil FAQs

Is Brazil a good country to outsource to?

Yes, for many firms. It offers skilled talent, low costs, and near-US time zones. Still, weigh taxes and local rules before you commit.

What services can you outsource to Brazil?

The top services are software development, IT, and contact center work. In addition, Brazil is strong in outsourced manufacturing.

How much can you save by outsourcing to Brazil?

Savings vary by role and city. However, the cost of living runs about 52% below US levels, so labor costs stay lower too.

Do Brazilian workers speak English?

Many do, since English is taught from a young age. Brazil ranks in the middle of global English proficiency, and skills are strongest in tech and business roles.

Key takeaways

• Brazil is a rising nearshore hub with a large, skilled workforce.
• Its living costs run far below US levels, which boosts client savings.
• Software development, IT, contact centers, and manufacturing lead the list.
• Near-US time zones and growing English skills make teamwork easy.
• Plan for local taxes and changing rules before you sign a contract.