Sri Lanka is one of the most underrated outsourcing destinations for Australian businesses. It has 175,000 tech and business-services professionals, a time zone close to ours, and an industry built for export.
Across Australia, from Perth to Brisbane, I hear the same thing from business owners. Hiring is slow, wages keep climbing, and good people are hard to keep. Most still treat outsourcing as something only banks and telcos do. That’s no longer true.
When Australians think offshore, they usually think of the Philippines or India. This article makes the case for looking at Sri Lanka too: what it does well, what to watch out for, and how to choose a partner.
Why Sri Lanka
The numbers show a mature, growing industry, not an experiment.
The gap between the two export figures matters. Some Sri Lankan firms book revenue through Singapore or Dubai, so the official number undercounts the real industry.
Beyond the numbers, four things stand out for Australian buyers.
- Time zone. Colombo is 2.5 hours behind Perth and 5.5 hours behind Sydney in daylight saving. A team starting at 6am in Colombo is online from 8:30am in Perth and 11:30am in Sydney.
- Finance talent. Sri Lanka has long been described as having the largest pool of CIMA-qualified accountants outside the UK (Daily FT). That makes it a strong fit for bookkeeping, accounts payable and management reporting.
- A built-in bridge. More than 130,000 Sri Lanka-born Australians understand both business cultures. Many offshore teams have Australian-based leaders or account managers because of it.
- Cost. Skilled Sri Lankan professionals cost a fraction of an Australian hire, which puts a dedicated team within reach of SMEs, not only enterprises.
What Australian businesses outsource to Sri Lanka
The best candidates are well-defined, repeatable tasks that don’t need to be done on site.
You don’t need to be big to start. A regional accounting practice or a family-owned distributor can begin with one or two dedicated people. A good partner supplies the recruitment, office, equipment and supervision.
Run a pilot first. Pick one function and run it for 90 days with clear measures, such as turnaround time, error rate and hours saved. Then decide whether to scale.
Keep a local owner. The setups that work best keep one person in Australia who owns the relationship and the process. The offshore team does the work; the local owner sets the priorities.
Two examples of Sri Lankan firms doing it well
There are hundreds of capable providers in Colombo and beyond. These two show different ends of the market.
The Connect BPO: managed outsourcing across functions. The Connect BPO runs dedicated teams for IT support, software development, QA, data analytics and back office work. Clients get fixed-scope pricing, defined SLAs and a named account manager. It’s part of the stable large finance organisation called Kanrich Group, a Sri Lankan group with more than five decades of history. It works with businesses of all sizes, from enterprises to small regional operators.
RNRobots: Microsoft Dynamics 365 specialists. RNRobots focuses on Microsoft Dynamics 365 development, implementation and ongoing support. That suits Australian businesses that need ERP or CRM expertise but can’t justify a full in-house Dynamics team with over 40 developers and functional and support consultants working 24 hours.
One is a generalist and one is a specialist. Most businesses will need one or the other, and sometimes both.
The risks, and how to manage them
Offshoring doesn’t remove your responsibilities. It changes where you manage them.
- Privacy. If your offshore team handles customer or staff data, Australian Privacy Principle 8 applies. You must take reasonable steps, usually an enforceable contract, so the overseas provider handles that data to the same standard. Under section 16C of the Privacy Act, you stay accountable if they get it wrong (OAIC). Ask any provider how they meet the APPs, not just GDPR.
- Economic stability. Sri Lanka went through a serious financial crisis in 2022 and has been recovering since. Choose a partner with solid financial backing and fixed pricing in Australian dollars, so currency swings are their problem, not yours.
- Staff turnover. Ask about retention rates, career paths and what happens to your work if someone leaves. A dedicated team with documented processes protects you.
- Working hours. Standard Colombo office hours finish at 7:30pm Perth time and 10:30pm Sydney time. Agree the shift pattern in the contract, not after go-live.
- Hidden costs. Get one monthly price that covers people, equipment, office space and management.
Seven questions to ask any offshore partner
- Is the team dedicated to my business, or shared with other clients?
- What does the monthly price include, and is it fixed?
- How do you meet Australian Privacy Act obligations, including APP 8?
- What are the SLAs, and who is my named account manager?
- What hours will my team work, and how much do they overlap with mine?
- What is your staff retention rate, and how do you handle handovers?
- Can we start with a 90-day pilot on one function?
A good provider answers all seven without hesitation.
The bottom line
Sri Lanka isn’t the answer for every business. But if you need skilled people in IT, software, Dynamics 365, finance or back office, it deserves a place on your shortlist. That’s true whether you’re an ASX-listed company or a five-person firm in regional WA.
Are you already working with an offshore team? I’d like to hear what’s worked for you and what hasn’t.
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