OVERVIEW
Business Process Outsourcing BPO growth is bolstering employment. SECTOR INSIGHT Amazon added 3 000 employees in 2020.
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Credit: iContact BPO
200-seat call centre opened in Paarden Island in 2021, further evidence of Cape Town’s attractiveness as a business process outsourcing venue. iContact BPO, which also has a centre in Johannesburg, is part of Alefbet Holdings Group, an international company with more than 1 000 full-time employees. The company’s CEO, Clinton Cohen, believes that South Africa offers speed to market, flexibility and professional delivery. Cohen gives an example of hiring 100 skilled agents in less than 100 hours to meet the exacting brief of a US-based automotive client. “There are few BPO sectors in the world that can provide this sort of agility and rapid scaling while maintaining quality and compliance requirements,” said Cohen. The BPO sector’s continued growth is good news for youth employment in the region and the country. According to McKinsey’s South Africa Big Five report, the BPO sector currently employs over 270 000 people in six cities, of which 65 000 serve international clients. This total could grow to over 775 000 jobs by 2030, with up to two-thirds of these servicing overseas markets. The UK makes up 61% of offshore business in South Africa, the US and Canada 18% and Australia 11%. In the course of 2020, Amazon increased its total South African recruitment to 7 000 with the addition of 3 000 new employees to service its North American and European markets. Significantly lower costs than European competitors and growth rates in the Business Process Outsourcing (BPO) sector that outstrip the global rate make the Western Cape an extremely competitive
ONLINE RESOURCES Business Process enabling South Africa (BPeSA): www.bpesa.org.za Contact Centre Management Group: www.ccmg.org.za National Department of Trade, Industry and Competition: www.dtic.gov.za
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destination. According to the Everest Group Study (2018), Cape Town’s costs for contact centre work are between 20% and 30% lower than the costs in Eastern and Central Europe. South Africa’s BPO industry is growing twice as fast as the world’s and three times faster than India and the Philippines (Invest Cape Town). UK shop Asda and online retailer Amazon have large customer service centres in Cape Town. Other big brands include British Gas, IBM, KLM, Lufthansa, Mastercard and Microsoft. Global and local BPO investors with operations in Cape Town include TutorABC, CSC, Collinsons Group, Bloomberg, Shell, AskOsca, JTC Group, Wonga, SimplyTalk, Ambition 24 Hour Group and Buongiorno. Inbound customer service (55%), inbound sales (15%) and debt collection (13%) comprise the biggest subsectors of the BPO sector in the Cape (Wesgro). Greater Cape Town is home to three universities, a university of technology and two technical colleges. Other factors in favour of the area are the relatively neutral accents, good financial and telecommunications infrastructure and the time zone being the same or close to Europe’s. ■
WESTERN CAPE BUSINESS 2022
