Business Process Outsourcing

International brands are choosing Cape Town.

“We are Africa’s BPO Capital,” says provincial Premier Alan Winde of the Western Cape.

Rob Kane, chairman of the Cape Town Central City Improvement District (CCID), a public-private partnership and non-profit organisation that is mandated to manage and promote Cape Town’s central business district (CBD), is even more specific: “Downtown Cape Town is a recognised technology, BPO and e-commerce hub, with reliable infrastructure, fast Internet speeds and a commitment to supporting a young workforce. The city is home to the most tech start-ups on the African continent, and the BPO sector supports call centres for global companies and online retailers with a steady pipeline of call-centre employees.”

Ian Ohlson, a director at Lufthansa InTouch Cape Town, which has been in the inner city since 1999 and has a staff complement of 573, says, “We chose the CBD due to the various options available for transport, the close proximity to shops, banks and lifestyle options.”

Many BPO businesses are part of the CBD’s night-time economy, which includes a vibrant First Thursday night when art galleries and museums open their doors and the town comes alive.

Cape Town hosts 60% of the country’s BPO centres, employing more than 50 000 workers. In 2022 it was also rated the most sustainable city in Africa in the Corporate Knights Sustainability Cities Index 2022 report, noted for its efforts in terms of air quality, emissions, solid waste generation and sustainable policies, among others. Currently there are 69 information and communication tech companies in the Cape Town central business district (CBD) alone, of which 25 are call centres. Included in this number are international brands like e-commerce giant Amazon, Lufthansa inTouch and Global Load Control.

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 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.

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

Sector Insight

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).

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 several 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. ■