A weaker peso is beneficial to the country’s business process outsourcing (BPO) industry, according to Contact Center of the Philippines (CCAP) President Benedict Hernandez.
During the International Contact Center Conference and Expo (ICCCE) 2013 recently held in Cebu, Hernandez said a strong peso is not good for the local BPO industry as it allows for cheaper operational costs of offshore outsourcing services in other Asian countries.
He said that the operational costs of BPOs remain cheaper by at least 25 percent in India compared to the Philippines because of the heavily depreciated rupee, even with the recent drop in value of the peso against the US dollar. But he also said that despite cheaper costs in India, the Philippines remains its biggest rival in the BPO industry because of the country’s “competitive advantages.”
“Our strong brand has made the Philippines less vulnerable to competing countries in the contact center sphere. Clients place a premium on our competitive advantage on language, affinity to Western culture and the authentic desire to provide exceptional service,” he said.
H. Karthik, vice president of outsourcing consultancy Everest Group, said that the impact of the weakening peso on call centers and healthcare services is not that significant compared with non-voice and information technology, despite higher costs compared to India.
Karthik said that to maintain a leading position, local call centers must offer differentiated services and reduce costs.
“The Philippines enjoys competitive advantage in skill, quality and cultural affinity,” he said.
Danila Sebastian Reyes, country manager of India-based Genpact Services LLC, said that while currency stability is important to business forecasts, global companies can always hedge their position in countries where they operate to mitigate the impact of foreign exchange fluctuations.
“While we always look long term, currency fluctuation is a cause for concern that the government must address,” Reyes said.
Hernandez earlier said the local BPO industry grew by 18 percent year-on-year in 2012, posting $16.3 billion in revenues and employing more than 900,000.
“The demand and appetite are there and we can anticipate that this hyper growth will continue,” He added.