South Africa and the Philippines are two of the most popular BPO destinations, but which one is best for your business?
As the world becomes more globalized the stage is set for renewed growth in the Business Process Outsourcing (BPO) industry. Faster communications are breaking down borders and reducing the importance of location. Outsourcing gives businesses the chance to access low-cost workers, broaden their talent pool, access new markets, and much more.
Traditionally the Philippines has been one of the most popular outsourcing destinations, but in recent years it has been challenged by the up-and-coming South Africa. Businesses are adopting a more nuanced approach to outsourcing – one driven by quality as much as value. When deciding on the best BPO solution for you and your business, you should take in a range of different factors.
Cost
Winner: The Philippines is normally marginally cheaper but the final calculation can be complicated.
When it comes to the bottom line the Philippines just about edges it in most situations. South Africa is highly price competitive. Its cities are some of the cheapest in the world which means its workers can afford discounted wages compared with most other locations around the world. However, the Philippines is still slightly cheaper in most instances than South Africa.
Even so, costs can vary across both countries depending on the type of role being outsourced and the destination of the employees.
South Africa also benefits from extensive government support in the form of tax breaks and grants. The level of support rises with the number of employees, so in some cases employing people in South Africa can be more cost-effective.
If cost is your overriding consideration it pays to run a comprehensive cost/benefit analysis to work out the real comparative cost of labor considering all government support available.
Language skills
Winner: South Africa
Both countries score well on this one. The Philippines is known for its language skills with English being widely spoken. However, it is not the first language which means there will always be something of a barrier between customers and call centre agents. Misunderstandings may be unavoidable leading to poor service, delays, and potentially lost income.
Furthermore, customers have reacted negatively to companies that have outsourced certain
functions, especially customer-facing roles to non-English speaking countries. More and more customers are prioritizing customer service levels and have shown a willingness to ditch companies that they feel are letting them down.
In South Africa, on the other hand, the majority of the population have excellent English and will speak with neutral clear accents that can easily be understood. Because English is a first language to many people it’s easier to communicate in a natural way that engages customers more deeply leading to higher levels of customer satisfaction, retention, and a higher revenue per call.
Quality assurance
Winner: South Africa
South Africa has pla