Western business in Ukraine: outsourcing

  • Western business in Ukraine: outsourcing
Issue 47, June 2012.

Eastern Europe is increasingly being considered as the alternative to traditional 'outsourcing' destinations. A highly skilled workforce, shorter journey times, smaller time-zone differences, European language skills and Western culture all contribute to this attraction. Companies in the US and Western Europe are increasingly turning to Eastern Europe for outsourcing and system development needs. Offshore outsourcing is on the rise in this region - especially in countries such as Ukraine, Russia, Belarus and the Baltic countries. A reduction in development costs is not the only reason for outsourcing; in addition, most advantages to offshore outsourcing in Eastern Europe are connected with government commitment to the industry, a highly skilled labour force and minimal socio-cultural differences in these countries.
In recent years Ukraine has become one of the most attractive outsourcing destinations in Eastern Europe. It is a country abundant with talented, highly skilled and well-educated individuals who as a result of the regional location have a better understanding of Western European and North American culture than its main counterpart: the Far East. For example, Ukraine is recognized worldwide as a reliable IT outsourcing country due to the low cost of services, a strong hi-tech educational system and a well developed market of IT outsourcing service provisions.
Ukraine is an ideal outsourcing location offering many favorable conditions. The following points can help dispel any possible misgivings that might arise.

  • Ukraine has approximately 1% of the world's population, but 6% of the world's physicists, chemists, mathematicians, biologists, computer programmers and other highly trained professionals.
  •  Ukraine was the most technologically developed republic of the former USSR.
  •  Most Ukrainian professionals speak fluent English.
  •  The labor costs in Ukraine are several times lower than in the USA or in the EU.
  •  Ukraine possesses many features of European culture, traditions and ways of thinking.

When comparing Western Ukraine to the Far East the following advantages become apparent:

  •  Short delivery times
  •  Possibility of producing small / special orders
  •  European production (demand of EU major tender committees)
  •  Low labour costs

Outsourcing companies are located all over Ukraine, as almost every large city has technical universities and higher educational institutions, which fuel the industry with skilled specialists. There are four main outsourcing centers in Ukraine: Kyiv, Lviv, Odesa, and the Crimean cluster.
On February 24th 2012, the Financial Times Foreign Direct Investment Intelligence Unit released their annual European Cities and Regions of the Future 2012/2013 report, which took into account information on 253 European cities and 110 European regions. According to the new document, seven Ukrainian cities topped the list of most cost effective destinations for investment. Lviv is the third on the list of Top 10 Large Cities, where investments would be the most cost effective, while Odesa took second place and Kyiv was a solid seventh place. Ukraine also holds places five to ten on the Top 10 Regions Cost Effectiveness list (Shumsk, Ternopil, Mohyliv-Podilskyi, Transcarpathia, Lviv and Kharkiv regions).
In this report Western Ukraine’s Lviv ranked fourth in Eastern Europe on the top ten list of cities that have the best strategy for attracting foreign direct investment. The city also enjoys the sixth position in the same category among large cities. In previous years it was also named among the Top 30 most promising outsourcing destinations by KPMG and the “Best Ukrainian City to Live” by Focus magazine.
For a foreigner who does not know where to start their business in Ukraine, who is also looking for real estate to purchase or rent but cannot find a suitable spot, who would like to optimize their taxes and make an audit of their company or seek advice on Ukrainian law, a team of professional consultants is always ready to help.
Proconsult is one of the consulting companies in Lviv, which stands out as an experienced team of professionals with a passion for delivering superior quality services in business development, project management, management consulting, tax consulting, auditing and legal assistance. Proconsult is an independent and dynamically growing company with a deep-seated corporate culture with a main advantage by having offices in both Kyiv and Lviv. Their main goal is to offer high quality and cost effective solutions delivered on time.
One of the key services of Proconsult is full assistance and support in outsourcing the client’s business to Ukraine. Services offered by Proconsult includes mergers and acquisitions, market research, extensive data on production facilities, company registration in state authorities, financial optimization, tax advising, audit, recruiting & HR, full legal support and representation at court, brokerage services (import and export custom clearance), expert evaluation of business, turn-key solutions, legal and technical Due Diligence.
During the past 12 years, Proconsult has worked with clients in various industries: textile, confection, hi-tech, transport and logistics, metal processing and engineering, wood manufacturing and furniture production, food processing and pre-fabricates. The company has experienced successful cooperation with companies from a variety of countries and among their clients are such companies as: Tamag GmbH, Kansas A/S, Fristads A/S, Boltjes BV, ACG Nystrom, Pagh Morups A/S, HRT, Airline Textiltryk A/S, Sika Footwear A/S, MP Investment Bank, Time and Space Sp z.o.o. Takata Japan, Odeko, Clasitek, Dyfan, Netto, Chantelle, Dyfan Investments NV, Progeny Solar, Тhule and others. Proconsult helps foreign investors develop their business in a way to reduce costs and expand possibilities. They guide their clients through creating top-notch business plans, financial optimization and market development. The company takes on each assignment with an individual approach and unerring accuracy, first identifying the needs of the client, developing an action plan, settling initial budgets for projects and proceeding with project implementation.

Proconsult experienced staff will gladly assist You in any issues at offices:  in Lviv (76/6 Ivana Franka Str., tel.: +38 (032) 243-47-16,) or Kyiv (4 Khreshchatyk Str., office 17, tel +38 (044) 494-18-96) or via email [email protected], www.proconsult.com.ua,