Date:10/08/2004 URL: http://www.thehindubusinessline.com/2004/08/10/stories/2004081001990700.htm

Back `W. European cos prefer nearshore call centres'

Our Bureau

"The most popular targets will be Poland, Hungary, the Baltics, North Africa and the Czech Republic. An educated labour pool (which is increasingly multilingual) and economic stability, are proving very attractive to Western firms."

New Delhi , Aug. 9

WESTERN European companies are gradually taking a liking to call centres near their shores such as those in Central and Eastern Europe despite cost-effective offshore options including India and the Philippines.

The trend is primarily due to their educated labour pool and growing multilingual capabilities, according to a recent report by market analyst Datamonitor.

According to the report, `Profiting from European nearshore outsourcing', the outsourced call centre agent positions in the nearshore regions of Central, Eastern Europe and North Africa are set to rise to 13,700 by 2008 from 4,400 in 2003.

Nearshore refers to outsourcing locations within close proximity - in this instance Western Europe - as opposed to offshore outsourcing regions that are not close.

"The most popular targets will be Poland, Hungary, the Baltics, North Africa and the Czech Republic. While the main threat to nearshore growth could come from inexpensive offshore alternatives in developing countries in both Central and Southern Africa and Asia, including India and the Philippines, the European nearshore qualities, for example educated labour pool (which is increasingly multilingual) and economic stability, are proving very attractive to Western firms," the report said.

Over the past decade, many countries in nearshore locations have adopted pro-business agenda, offering tax cuts and incentives to lure private enterprise to their jurisdictions, it said.

Nearly every government in the region has made efforts to bring in outsourced contact centre investment.

While the market for these services is obviously more mature in the Baltics, Poland, Czech Republic, Morocco and Hungary, Datamonitor expects that growth in Tunisia, Bulgaria, Romania and the Balkans would be significant due to their friendly investment attitudes and geographic niche-market advantages.

The report said that Czech Republic, Poland, and Hungary would be the choice destinations for higher-end customer care for German and English-speaking customers, while Romania and Bulgaria would focus on routine customer care queries.

"Romania will focus on Italian and French clients, while Bulgaria will concentrate on customers from the UK and Germany," the report said.

It also said that Croatia and Slovenia had an excellent opportunity to win business in Italian and German-speaking customer care.

The report said that the Baltics (Estonia, Latvia and Lithuania) were likely to remain the outsourcing location of choice for firms servicing Scandinavian customers, even as Morocco and Tunisia remain focused on French customer care.