Why outsource to South Africa?

As South Africa continues to rank in the world’s top 3 offshore CX delivery locations, the country’s status as a leading destination for global business services or “Business Process Outsourcing (BPO)” is consistently reaffirmed.

The United States is currently the fastest-growing source market for global business services from South Africa (17%), while other international markets serviced from SA include the United Kingdom (62%), Australia (10%), China (8%), other African countries (2%) and Europe (1%).

SA as a source destination offers cost savings of 60% to 70% compared to Australia, the UK and the US: 65% less for voice-based delivery and 60% less for non-voice-based delivery.

Most recently, SA tied in second place (with the Philippines) as the Most Favored Offshore CX Delivery Location for 2024. Perhaps more compellingly, however, the South African BPO industry has an 18% higher customer experience satisfaction rating than its peers [India and Philippines].

Global brands and enterprises that outsource to South Africa achieve CX quality that is “18% better” than that of competitor offshore markets, as well as higher first call/contact resolution. This consistently translates into 4-5% more customer retention year-on-year, greater customer lifetime value (CLV) and more bottom-line profits. – South Africa GBS Investor Handbook, BPESA & Invest SA

IN SUMMARY

Outsourcing to SA makes good business sense, whether your goal is to overcome labor shortages, mitigate risk via geographic diversification, or leverage specific advantages including favorable exchange rates, a neutral accent, convenient time zones, impact sourcing, and a consistent reputation for top-ranked CX.

THE DETAILS

6 COMPELLING REASONS TO OUTSOURCE TO SOUTH AFRICA

#1: Better quality, lower costs

• Compared to developing world BPO destinations like India and the Philippines, South Africa offers an 18% higher customer experience satisfaction rating than its peers.
• SA is currently the third largest offshore location for UK and Australian organizations that value the country’s cultural affinity, excellent work ethic and empathy-led CX.

#2: World-class infrastructure

• SA’s telecommunications infrastructure is world class. High-speed fibre provides fast, affordable connectivity over a network that is 99.9% digital and includes the latest in fixed line, wireless and satellite communication.
• A 9000-kilometer undersea cable will shortly link the East London Industrial Development Zone (ELIDZ) to Mauritius and India, further growing the network.

#3: Convenient time zone location

• South Africa operates on similar time zones to the United Kingdom and Europe.
• Given its central location, SA is strategically positioned to provide on-demand customer support to the USA, Canada and Australia.

#4: Government support for GBS

• SA’s global business services sector enjoys strong and in some cases, financial, support from the national government when it comes to international investments and job creation.
• The Global Business Services Incentive Programme (est. 1 Jan 2019) exists to ensure that any organization placing service delivery centres in SA extracts real value from its investment (InvestSA).

#5: English language proficiency

• The country’s large English-speaking talent pool is known for quality communication skills.
• The South African English accent is easily understood and, given its neutrality, is often preferred to many other outsourcing destinations.
• South Africans have a cultural affinity with Western countries, making it easier to understand customer and client requirements, build rapport and align practices.

#6: Large, diverse pool of talent

• SA has a well-educated and highly skilled workforce, particularly in sectors like customer service, IT, finance, and manufacturing, where English proficiency is high.
• There are large pools of multilingual talent, including Dutch, German, French, Italian and Spanish speakers.
• According to the?GBS Sector Job Creation Report, the BPO sector has created 112,441 jobs since 2015 and attracted significant capital, resulting in a 41% expansion of the industry over the past 10 years.?

South Africa’s BPO sector gained worldwide recognition and widespread credibility for its ability to navigate the COVID-19 pandemic, maintaining business continuity and client service while safeguarding employee health. The country emerged as a dependable services delivery location that could transition quickly to a remote-working model, enabling many companies to relocate operations from other sites while maintaining standards in quality and service delivery.

SOUTH AFRICA’S WORKFORCE BY NUMBERS:

• The South African workforce has a 96% multi-ethnic composition, including 89% youth and 65% female employees.
• SA produces 180 000 tertiary and 430 000 high school graduates annually.
• 16.5 million English speakers have a neutral accent.
• The country’s youth population, aged 18-35, totals 17.6 million.
• 410,000 English speakers are added to the country’s workforce each year.

South Africa’s BPO sector is a significant role player when it comes to ‘impact sourcing’; namely, inclusive hiring and building inclusive supply chains. BPESA is a founding member of the Global Impact Sourcing Coalition (GISC) and conducts multiple national Skills Development Programmes focused on upskilling/reskilling to create distinct advantages in niche skills availability.

Sources:

• ?Ryan Strategic Advisory’s Front Office CX Omnibus Survey 2024 https://ryanadvisory.com/india-is-the-most-favored-offshore-cx-delivery-location-in-2024/
• Investec Corporate Leverage Finance 2024 https://www.investec.com/en_za/focus/economy/unlocking-south-africas-business-process-outsourcing-potential.html
• BPESA’s GBS Sector Job Creation Report October to December 2023 https://www.bpesa.org.za/quarterly-job-reports/quarterly-job-reports/october-to-december-2023-gbs-sector-job-creation-report.html
• South Africa GBS Investor Handbook 2023, BPESA & Invest SA https://www.bpesa.org.za/invest-in-south-africa/useful-documents.html