For over two decades, the Philippines has crafted a reputation as the top call center outsourcing destination on the planet. In fact, it has earned the moniker “Business Process Outsourcing Capital of the World,” largely due to the country’s success in delivering high-quality contact center solutions. There are many reasons for this, such as an educated workforce and ongoing government support. The biggest factor, however, is that premium call center providers in the Philippines have mastered a pricing structure that enables them to deliver world-class service consistently.
What many organizations looking for call center outsourcing in the Philippines fail to understand is that the cost structure of outsourcing has a direct impact on quality. An hourly rate for a premium call center outsourcing vendor average approximately US$12 to US$14 per hour. In contrast, a low-cost call center costs about US$6 to US$8 per hour. The difference? The premium call center delivers reliable, world-class service in the form of highly skilled agents and robust infrastructure. The low-end call center may be hard-pressed to even deliver the same agents on a week-to-week basis.
In the Philippines, demand for the best, brightest, and most highly skilled agents is fierce. In fact, the demand far outweighs the supply for call center staffing in the Philippines. “This imbalance has coincided with the explosive growth of the Business Process Outsourcing (BPO) industry in the Philippines over the years and has led to steadily increasing salaries. The country’s leading call center outsourcing providers and captive operators understand that they need to pay top dollar to attract and retain top talent,” says Ralf Ellspermann, CEO of PITON-Global, an award-winning, mid-sized call center outsourcing provider in the Philippines.
For the last twenty years, agent salaries have steadily increased at a rate of US$20 (P1,000) per year. Now, the Philippines’ premium BPO providers, third-party outsourcers and captive operators, pay a premium for top agents, with salaries of US$600 to US$800 (P30,000 to P40,000) per month. The days of hiring highly skilled, experienced, and English-proficient agents in the Philippines for US$2 to US$2.50 per hour are long gone.
Yet a low-cost call center in the Philippines that charges US$6 to US$8 per hour can only afford to allocate US$2 to US$2.50 for an agent’s salary, since there are other costs that must also be covered, such as the operating margin of 30%, cost of management, support, infrastructure, technologies, telco, utilities, etc. These low-cost contact centers simply do not generate enough revenue to be able to hire and retain the country’s top agents, who are needed to make programs work and to deliver a truly world-class Customer Experience (CX).
Over the last two decades, as the outsourcing industry has grown and matured in the Philippines; it has become one of the most highly desirable employment sectors for Filipino professionals. The industry enjoys full government support as well as highly focused curricula in the country’s leading universities dedicated to high-value specializations such as IT, AI, and R&D. As a result, the market for jobs at the leading outsourcing service providers in the country is thriving. “For Filipino professionals, it is also a point of pride to work for or represent some of the biggest brands in the world, such as Amazon, Facebook, and Google. Likewise, these leading Fortune 500 companies and SMEs are perfectly willing to offer top compensation packages to hire and retain the most talented and skilled agents in the country. They understand that doing so will allow them to deliver world-class CX and roll out higher-level business processes.”
Low-cost vendors cannot compete with this level of quality and service, and as a result, they are unable to hire and retain the top agents. When a low-cost call center in the Philippines can compete only on price, they will experience a revolving door of low-quality labor. “For low-cost vendors, it then becomes a race to the bottom, and for the companies that partner with them, the result is frustration, additional (unplanned) costs, and in most cases, program failures.
“However, for the organization that understands the value of working with a premium outsourcing call center in the Philippines, the result is quite the opposite. A slightly higher cost is directly proportional to the long-term success of the program and ultimately equates to outsourcing done right,” explains Mr. Ellspermann.
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