Outsourcing Guides
Outsourcing call centres to South Africa is changing the game for how companies outsource customer service operations.
Tired of listening to hard-to-understand accents via outsourced call centres? If so, you’re not alone. Call centre outsourcing is one of the major bugbears of customers. It has become associated with poor levels of customer service and a cost-cutting strategy which puts customers well and truly last. However, it doesn’t have to be that way, which is why many companies are getting better results by outsourcing call centres to South Africa.
Why outsource call centres to South Africa?
The business process outsourcing sector is one of the fastest-growing areas of South Africa’s economy. Major corporations across Europe, the US, and the UK have shifted their operations here, drawn by the promise of better quality and improved customer experiences.
South Africa represented an ideal option for several reasons.
1. English skills: The biggest complaint about outsourcing call centre services to third countries is the lack of language skills. Communication barriers are a common cause of frustration for customers who have shown a growing willingness to abandon brands in favour of competitors who offer a better customer service experience.
2. Technological infrastructure: BPO companies in South Africa benefit from state of a are technological infrastructure, including super-fast broadband, cloud computing and advanced CRM software packages. This enables fast, seamless interactions with domestic customers and your internal team
3. Location: South Africa has a key strategic position, making it ideal for markets across the Middle East, Europe and Africa. At most, there will be only a couple of hours’ time difference between call centre agents in South Africa and your customers at home. It’s well-positioned to cover the working day, while for other countries such as the US and Australia, a larger time difference can also be useful in providing out-of-hours call centre services so brands can give customers the benefit of 24/7 support.
4. Government support: South Africa’s government has been extremely supportive of the BPO sector. It has proved to be a valuable source of internal investment and jobs. For a country struggling to retain its top talent, outsourcing call centre services is a good way to give graduates the high-quality, well-paying jobs they’re looking for. Any hiring company can benefit from a host of incentives and tax breaks which enhance the ROI of outsourcing call centre services.
5. Labour costs: Finally, the most obvious reason to outsource call centres remains cost. Wages in South Africa are slightly higher than in some of the lowest-cost BPO hubs such as the Philippines, China or India, but they still represent a substantial discount on wages in the UK. For those companies that still see call centre work as a bottom
line only cost, India might still seem to represent a better deal, but poor quality customer service represents a cost in itself through lost revenue and low customer satisfaction. When thinking about costs, it’s important to adopt a 3D perspective.
Counting the cost
The cost calculation will be the first thing many businesses will look at. South Africa is cheaper than the West, but more expensive than some of the other outsourcing hubs. However, when you calculate the true cost of doing business, the figures look much more compelling.
In addition to lower wages, South Africa’s government offers tax incentives and reductions to companies which create jobs in South Africa. How much exactly depends on the number of jobs created and in which industries. Further incentives may be available for companies which set up in areas of high unemployment as the government bids to extend growth beyond the main cities.
Once these are taken into account, the true cost of outsourcing to South Africa will be much lower than it first seems. In addition to that, a reputation for superior levels of customer service helps build customer relationships, leading to better customer retention and higher revenue per customer.
Finding call centre staff in South Africa
There are several ways you can build your call centre function in South Africa.
1. BPO providers: Specialist companies offer outsourced call centre services to international clients. This is a quick, simple and relatively affordable approach, but you may not have much control over the recruitment process. You will pay a fee to the BPO, and it will make staff available to you. They can be trained to understand your product and will offer a friendly, professional service.
2. Direct employment: Another option is to set up a foreign subsidiary in South Africa and employ people directly. This gives you total control over the recruitment process and enables you to build a team with in-depth knowledge of your company’s services. However, you will need to set up a foreign subsidiary, which can be expensive and entail operational risk through unfamiliarity with South African working regulations.
3. Employers of Record (EOR): Sitting between direct employment and BPO companies are employers of record. They can effectively serve as proxies by serving as the legal employer for your South African staff. This protects you from legal liability and avoids the need to set up a legal entity in the country. Each EOR will work slightly differently with a range of service options, but in general, you will pay a fee to them, and the EOR will pay the staff directly. The EOR may provide support in the recruitment and talent sourcing process and will facilitate ongoing communication with your employees. You get more control over the process than under a BPO, but you also benefit by offloading administrative and legal responsibilities onto a local company with expertise in HR services.
Which of these options you choose will depend on your company’s situation and your forward-looking strategy. As we look to the future, though, demand for call centre outsourcing in South Africa is growing. Technology facilitates a faster flow of information with greater control over the management of workforces. With the market evolving, the outsourcing options are moving beyond just call centres, but into every area of business operations.
