Profiting from established offshore contact center locations: India, Philippines, Canada, Mexico (Review Report)

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Profiting from established offshore contact center locations: India, Philippines, Canada, Mexico (Review Report)
Market Report, October 2006, 2885 €

Description

IntroductionA comprehensive review of established outsourcing markets including Canada, India, Mexico and the Philippines.Scope*Analysis of Canada's outsourcing market*A discussion of Mexico's emergence as a US nearshore location*A review of India and the Philippines, the most mature of all offshore contact center markets*Numerical and graphical descriptions of these four maturing marketsHighlightsTotal market sizes for the four maturing contact center outsourcing markets contained in this reportAnnual rates of growth for each individual market analyzed in this reportStrategic recommendations describing how investors can profit from each of these marketsReasons to Purchase*Understand how the maturing contact center outsourcing markets are likely to evolve through 2010*Learn about what investors need to do so as to use the markets for quality and cost effective customer care*Identify any emerging opportunities for domestic customer service in each of these locations

Sommaire

DATAMONITOR VIEW 1
CATALYST 1
SUMMARY 1
METHODOLOGY 2
EXECUTIVE SUMMARY 3
Introduction 3
Mexico: A solution for the US Hispanic market? (Market Focus) 3
Selling Canada as a Nearshore Option (Market Focus) 3
Philippines: Balancing risk through diversification (Market Focus) 3
India: Still the king of offshore (Market Focus) 4
Contact Center Outsourcing Trends in Canada, India, Mexico and the Philippines (Databook) 4
MEXICO: A SOLUTION FOR THE US HISPANIC MARKET? (MARKET FOCUS) 7
Summary 7
Contact center outsourcing in Mexico is projected to grow through 2010 7
Why Mexico is a logical destination of choice for US customer service 9
Growth of the US Hispanic market 9
US Hispanic economic advancement 10
US Hispanic country of origin is predominantly Mexico 11
Lower business costs than in the US 12
Labor arbitrage favors Mexican agents 12
Property costs in Mexico fall below those of the US 13
Minimal exchange rate risk strengthens Mexico's competitive positioning 14
Mexico's proximity is an advantage relative to other Latin American countries 15
Mexico's long-term growth is limited due to emerging competition 15
Growth in regional competition 16
Mexico's comparatively higher costs 16
Labor 16
Real Estate 16
Mexico is becoming a saturated market for contact center outsourcing 17
Step one: migrate to high-end US Hispanic customer care over the long term 18
Step two: examine the possibility of providing domestic outsourcing services in Mexico 18
Step three: work to keep costs down in Mexican operations 18
SELLING CANADA AS A NEARSHORE OPTION (MARKET FOCUS) 20
Summary 20
Contact center outsourcing in Canada is slowing 20
Total outsourced Canadian APs 22
Canada's domestic outsourced industry 22
Canada's offshore outsourced industry 22
Canada is becoming a costlier prospect for US outsourcers 22
Appreciation of the CAD versus the USD 23
Canadian domestic inflation 23
Canadian outsourced contact center agent costs 24
Canadian property costs 25
Canada lacks sufficient Spanish-speakers to meet projected US demand 26
US Hispanic population explosion 26
Canada's Spanish challenge 27
Contact center saturation is becoming an issue in key Canadian locations 28
Step one: target value-add US customer care 28
Step two: attack secondary urban centers 28
Step three: attack the Canadian domestic market 29
PHILIPPINES: BALANCING RISK THROUGH DIVERSIFICATION (MARKET FOCUS) 30
Summary 30
The Philippines presents a strong outsourcing opportunity in its domestic market 30
Expanding total outsourcing market but slowing overall growth 30
Limited offshore prospects offset by growing domestic outsourced segment 31
Vertical outsourcing opportunity - financial services, telcos, technology and retail 34
Solid sophistication in the Philippines means good customer interactions 35
US cultural affinity means opportunity in Canada and Australia 37
The Philippines is cost effective and shows little sign of escalating overheads 38
INDIA: STILL THE KING OF OFFSHORE? (MARKET FOCUS) 41
Summary 41
India's offshore outsourcing market is still a viable offshore location for English speaking services 43
India's domestic market presents real revenue opportunities in this expanding market 45
Why India still offers investors a very low-cost business environment in the medium term 46
India has a lower cost-per-agent than western locations. 46
India also compares favorably on price with many offshore locations 46
India has a sizeable pool of labor from which outsourcing investors can draw 47
Investors can profit from low property and facilities costs in India 48
India's ongoing stability is a major advantage for investors 49
India's continued economic reform means investor confidence 49
Ongoing political stability means limited risk for investors 50
Beware of potential erosion of India's value proposition over long term 50
India is susceptible to rising contact center agent costs 50
Incentives are slowly disappearing in India 51
Global offshore competition is likely to hurt India's value proposition 51
Inter-industry competition for labor means increased wage escalation 51
Infrastructure concerns abound in many of India's commercial centers 52
MATURING CONTACT CENTER OUTSOURCING LOCATIONS (DATABOOK) 53
Introduction 53
Definitions 53
Canada 54
India 62
Mexico 70
Philippines 77
APPENDIX 85
Ask the analyst 85
List of Tables
Table 1: Mexican outsourced APs, 2005 -2010 9
Table 2: Travel time from New York City to various Latin American cities 15
Table 3: Canadian outsourced APs - domestic versus offshore, 2005 2010 21
Table 4: Demand for Canadian outsourced offshore APs, 2005 - 2010 22
Table 5: Outsourced Philippine APs, 2005 - 2010 31
Table 6: Philippine outsourced APs - domestic versus offshore, 2005 - 2010 33
Table 7: Indian outsourced APs, 2005 - 2010 43
Table 8: Key Indian economic indicators, 2003 - 2005 50
Table 9: Contact Center definitions 53
Table 10: Total Canadian outsourced agent positions (000s) 2005 - 2010 54
Table 11: Vertical distribution of offshore outsourced APs in Canada (000s) 2005 - 2010 56
Table 12: Vertical distribution of domestic outsourced APs (000s) in Canada 2005 - 2010 58
Table 13: Outsourced offshore APs (000s) in Canada by contact center sizeband 2005 - 2010 59
Table 14: Outsourced domestic APs (000s) in Canada by contact center sizeband 2005 - 2010 60
Table 15: Geographic markets served by Canadian outsourced APs 2005 - 2010 61
Table 16: Total Indian outsourced agent positions (000s) 2005 - 2010 62
Table 17: Vertical distribution of offshore outsourced APs (000s) in India 2005 - 2010 64
Table 18: Vertical distribution of domestic outsourced APs (000s) in India 2005 - 2010 66
Table 19: Outsourced offshore APs (000s) in India by contact center sizeband 2005 - 2010 67
Table 20: Outsourced domestic APs (000s) in India by contact center sizeband 2005 - 2010 68
Table 21: Geographic markets served by Indian outsourced APs 2005 - 2010 69
Table 22: Total Mexican outsourced agent positions (000s) 2005 - 2010 70
Table 23: Vertical distribution of offshore outsourced APs (000s) in Mexico 2005 - 2010 72
Table 24: Vertical distribution of domestic outsourced APs (000s) in Mexico 2005 - 2010 74
Table 25: Outsourced offshore APs (000s) in Mexico by contact center sizeband 2005 - 2010 75
Table 26: Outsourced domestic APs (000s) in Mexico by contact center sizeband 2005 - 2010 76
Table 27: Geographic markets served by Mexican outsourced APs 2005 - 2010 77
Table 28: Total Philippine outsourced agent positions (000s) 2005 - 2010 78
Table 29: Vertical distribution of offshore outsourced APs (000s) in Philippines 2005 - 2010 79
Table 30: Vertical distribution of domestic outsourced APs (000s) in Philippines 2005 - 2010 81
Table 31: Outsourced offshore APs (000s) in Philippines by contact center sizeband 2005 - 2010 82
Table 32: Outsourced domestic APs (000s) in Philippines by contact center sizeband 2005 - 2010 83
Table 33: Geographic markets served by Philippine outsourced APs 2005 - 2010 84
List of Figures
Figure 1: Mexican outsourced APs, 2005 - 2010 8
Figure 2: US Hispanic population relative to total population, 2000 & 2004 10
Figure 3: US Hispanic household income, 1992 - 2004 11
Figure 4: US Hispanic ancestry 12
Figure 5: Outsourced agent pricing, 2005 13
Figure 6: Commercial real estate rents - Selected North American cities, 2005 14
Figure 7: Mexican peso versus USD, 2004 - 2006 15
Figure 8: Latin American comparative urban commercial real estate 17
Figure 9: Total Canadian outsourced APs, 2005 - 2010 21
Figure 10: CAD versus USD, 2001 - 2006 23
Figure 11: Canadian domestic inflation growth, 2004 - 2006 24
Figure 12: Outsourced contact center agent price per agent per hour, 2005 25
Figure 13: Commercial gross real estate rents in selected cities, 2005 26
Figure 14: US Hispanic population relative to total population, 2000 & 2004 27
Figure 15: Outsourced Philippine APs, 2005 - 2010 31
Figure 16: Philippine outsourced APs - domestic versus offshore, 2005 - 2010 32
Figure 17: Selected Philippine economic indicators, 2005 - 2007 34
Figure 18: Philippine contact center outsourcing - vertical analysis, 2005 & 2010 35
Figure 19: Philippine outsourced contact center demand by country, 2005 - 2010 37
Figure 20: Offshore contact center location price / agent / hour, 2005 39
Figure 21: Indian outsourced APs, 2005 - 2010 42
Figure 22: Indian outsourced offshore APs, 2005 - 2010 44
Figure 23: Indian offshore outsourced demand, 2005 - 2010 45
Figure 24: Indian domestic outsourced APs, 2005 - 2010 46
Figure 25: Global agent pricing survey, 2005 47
Figure 26: Labor force and unemployment levels - selected offshore locations, 2005 48
Figure 27: Gross office rents - selected cities, 2005 49
Figure 28: Total Canadian outsourced agent positions 2005 - 2010 54
Figure 29: Vertical distribution of offshore outsourced APs in Canada 2005 - 2010 55
Figure 30: Vertical distribution of domestic outsourced APs in Canada 2005 - 2010 57
Figure 31: Outsourced offshore APs in Canada by contact center sizeband 2005 - 2010 59
Figure 32: Outsourced domestic APs in Canada by contact center sizeband 2005 - 2010 60
Figure 33: Geographic markets served by Canadian outsourced APs 2005 - 2010 61
Figure 34: Total Indian outsourced agent positions 2005 - 2010 62
Figure 35: Vertical distribution of offshore outsourced APs in India 2005 - 2010 63
Figure 36: Vertical distribution of domestic outsourced APs in India 2005 - 2010 65
Figure 37: Outsourced offshore APs in India by contact center sizeband 2005 - 2010 67
Figure 38: Outsourced domestic APs in India by contact center sizeband 2005 - 2010 68
Figure 39: Geographic markets served by Indian outsourced APs 2005 - 2010 69
Figure 40: Total Mexican outsourced agent positions 2005 - 2010 70
Figure 41: Vertical distribution of offshore outsourced APs in Mexico 2005 - 2010 71
Figure 42: Vertical distribution of domestic outsourced APs in Mexico 2005 - 2010 73
Figure 43: Outsourced offshore APs in Mexico by contact center sizeband 2005 - 2010 74
Figure 44: Outsourced domestic APs in Mexico by contact center sizeband 2005 - 2010 75
Figure 45: Geographic markets served by Mexican outsourced APs 2005 - 2010 76
Figure 46: Total Philippine outsourced agent positions 2005 - 2010 77
Figure 47: Vertical distribution of offshore outsourced APs in Philippines 2005 - 2010 78
Figure 48: Vertical distribution of domestic outsourced APs in Philippines 2005 - 2010 80
Figure 49: Outsourced offshore APs in Philippines by contact center sizeband 2005 - 2010 82
Figure 50: Outsourced domestic APs in Philippines by contact center sizeband 2005 - 2010 83
Figure 51: Geographic markets served by Philippine outsourced APs 2005 - 2010 84