Small, medium American enterprises tap local BPO firms

As the global economic slowdown takes its toll on businesses, more small and medium enterprises (SMEs) in the US have begun outsourcing their back office processes to cut costs, an official of a local contact center association said.

In an interview, Jojo Uligan, Contact Center Association of the Philippines (CCAP) executive director, said US-based SMEs did not see the need to outsource these jobs prior to the crisis.

But now, these businesses have been started tapping Philippine business process outsourcing (BPO) firms to save on costs and keep their operations efficient.

Uligan said the local industry observed that big clients from the US—which is the Philippines’ largest BPO market—have slightly decreased.

But on the brighter side, the sector has been attracting additional clientele among US-based SMEs as they have now realized the value of outsourcing, he said.

The CCAP official said most of these American SMEs outsource some activities through small contact centers in the Philippines while large call centers have also been accommodating them as clients, allotting five to 10 seats for each account.

Currently, small call centers make up about 5,000 of the total 200,000 contact center seats nationwide.

On Wednesday, Sen. Manuel “Mar” Roxas 2nd said small contact centers in the country should consolidate and merge to corner more capital.

“Small call centers don’t have the scale and capital to go after big contracts. They can’t afford to hire representatives in the US, who are too expensive, to book contracts for them,” Roxas told reporters on the sidelines of the CCAP Call Center Conference and Expo 2009.

“We’re not discouraging small players nor stopping them, but if they want to get access to capital, they have to do so,” he said.

Roxas said mergers and consolidation between small players call centers grow as the local industry is currently dominated by multinational firms, affiliates of large corporations or adjuncts of telecommunications companies.

It was during Roxas’ time as Trade secretary when the local BPO industry started to develop in the country.– Ben Arnold O. de Vera, Manila Times