Outsourcing is not just an Indian trend. U.S. firms are also moving (way) south of the border to serve Spanish-speaking customers, reports Fortune's Stephanie Mehta.
NEW YORK (Fortune) -- Most Americans realize that when they call a bank, electronics maker or insurance provider, there's a good chance their queries will be routed to a call center outside the U.S., perhaps in India, the Philippines or other markets filled with English speakers happy to provide customer service or tech support for relatively low wages.
But what happens to the calls of the 31 million Americans who speak Spanish at home? Those who want to get help in Spanish increasingly are speaking with agents located in the hot new region for call centers: Latin America.
According to research outfit Datamonitor, Latin American countries (the data exclude Mexico) could see the number of call center jobs, known in the industry as "agent positions," grow to 188,500 in 2010, up from 103,600 in 2005. The growing U.S. Hispanic population - the Census Bureau says there will be more than 102 million Hispanics in the U.S. by 2050, up from about 44 million today - is responsible, in part, for the expansion of Latin American call centers.
Amit Shankardass, a senior vice president of global marketing for Sitel, a Nashville, TN.-based outsourcing firm, says U.S. firms want to provide customer care and support to this population, but also are looking for ways to affordably telemarket to Hispanic homes. And often, that means using bilingual agents: While most U.S. Hispanics speak English - of the 31 million Americans who say they speak Spanish at home, more than half say they speak English very well - a number of immigrants are more comfortable conducting business in their native language.
That's where Latin American call centers come in. Sitel consultant Randy Harris says countries such as Panama are endowed with educated, bilingual populations, and agents there can handle calls in English and Spanish, sometimes simultaneously, making it an ideal place to handle calls to and from U.S. Hispanic households.
But Latin American call centers aren't just for companies looking to serve the U.S. Spanish-speaking population. Indeed, some of the first companies to outsource customer services and marketing to Latin America were companies based in Spain. Today, Sitel's Latin American call centers, for example, serve European clients (Portuguese corporations use centers in Brazil) and a growing number of Latin American companies looking to outsource their back-office operations to one or two lower-cost locations. The company has some 10,000 employees in the region.
Still, some companies are not entirely comfortable outsourcing to Latin America, says Peter Ryan, a senior analyst at Datamonitor. Some perceive Latin America as an unstable place to do business, even though countries such as Chile, Costa Rica and others are very pro-business, and are installing telecommunications infrastructure and other amenities to lure multinational corporations. And even if culturally "Latin America" seems close to home, in reality it can be far away; a plane ride to Buenos Aires isn't much shorter than a trip to Manila, depending on where executives are based.
Still, Ryan and others are optimistic that Latin America will be the next great call center capital of the world, partly because it has a potentially bigger clientele: It can serve not only U.S. multinationals but European and Latin American clients as well. Sitel, for example, says it serves customers from 28 countries out of its Latin American facilities. The outsourcing business in Latin America "may never be the size of India," says Sitel consultant Harris, "but it is a good solution for a lot of customers."