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Contact Center Outsourcing Heads South of the Border

Contact Center Outsourcing Heads South of the Border

January 23, 2015
By TMCnet Staff

Despite all the noise about India and the Philippines grabbing the lion’s share of the call center market, a surprising newcomer is making its presence felt, and might well be a force to reckon with in the very near future.

A recent report from the Everest Group, “Central America and the Caribbean Answer the Call for English-Language Contact Center Services”, takes a closer look at the this nascent region and draws some strong conclusions about its viability as a new call center destination.


Industry publication Nearshore Americas dove into the research in depth, and spoke with the report’s authors, Anurag Srivastava and Aditya Verma about their findings, and what the area’s strength and weaknesses are.

“While operating costs vary significantly – driven by difference in wages across the region – all the locations offer 35-75 percent cost arbitrage compared with tier-two locations in the United States such as Dallas,” Nearshore Americas said. “Most locations have low wage inflation (4-7 percent), but ‘the cost arbitrage is likely to decrease slightly in the next five years, as depreciating currencies counter the effect of inflation,’” they said the report predicts.

Among the most striking findings, Verma told Nearshore Americas, was that “the size of the market in these locations surprised us. Many of these locations are still emerging so we were not expecting the size of the industry to be as big as it is.”

Which leads to the next logical question: Given the small size of countries in the region relative to the rest of Latin America, and equally limited populations, how long will it be before the market becomes saturated and the talent pool is exhausted? Fortunately, it’s not really a concern at all.

“We’ve analyzed the continuity of cost and it’s actually quite good in almost all of the locations,” Verma said. “As for talent, there are some concerns because most of these locations are not big and the talent pool is limited. So there is obviously some concern around scalability and how long the talent pool is going to last,” but, “I think there is some time left before these locations reach saturation point.”

One item the report did note is how Central America is well positioned to serve the Canadian and Brazilian markets.

“Canada and Brazil … represent realistic markets,” Nearshore Americas said. “Serving Canada’s French-speaking population is ‘definitely’ more viable than serving France because of Canada’s geographic proximity to the region and the aligned time zones,” Srivastava said. “I think French support is something that is becoming more important in the Canadian market, so that may be something that companies will have a look at more closely.”

With a growing workforce, lower costs and geographic proximity, the only surprise is that no one has jumped on this bandwagon before now. All that would seem to be ready to change.





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