Is South Africa the Next Major Outsourcing Hub?
Loved and loathed in equal measure, outsourcing is nonetheless major business; it provides efficiency for the companies it serves, and the providers themselves are able to grow, frequently in areas not traditionally known as business centres. It’s often a boon for developing economies. Reports from South Africa are beginning to suggest that it too may become a hub of activity, with contracts primarily coming from the Anglosphere. Those looking to outsource to a developing locale might want to read on.
Expansion and Improvement
Growth in the business process outsourcing market in South Africa is increasing rapidly, with no signs that it is likely to slow down any time soon, with several major providers expanding their premises and amplifying operations. The aim is not only to increase the volume of contracts being won from places like the US and Europe, but to also improve the quality and variety of the services offered, as international businesses look to outsource increasingly complex processes, outside the usual HR and IT products.
One of the major attributes South Africa benefits from is a very large English-speaking base, meaning the country can win major contracts coming from the United States and United Kingdom with some level of advantage over other alternatives. Many also suggest that South Africa can offer a much better level of infrastructure than other outsourcing locations; the country being classified as a newly industrialised one, and benefiting from fully-developed services in major cities like Cape Town. The government is also making a push, recognising the 6-8 billion rand that the BPO (business process outsourcing) industry contributes each year; it’s likely that this attitude will result in further incentives to make the country a top choice.
South Africa will face challenges of course. While it is pursuing a position as one of the leading outsourcing destinations, it is not necessarily even the top destination in Africa just yet. The World Bank ranks Mauritius as the best place in Africa to do business, with its established financial services sector actually one of the world’s 20 best. It’s little surprise that major providers like TNT Business Solutions choose to operate BPO centres on the islands.
Still, South Africa’s outsourcing industry has a lot going for it; a large English-speaking population, solid infrastructure and the backing of the government. It could well be only a few years before it is indeed recognised as the leader in Africa, and potentially one of the best offshore BPO destinations in the world.