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Cost Advantages Of Tier 2 Locations A Double Edged Sword

The proliferation of tier 2 delivery locations in offshoring destinations such as India and the Philippines result in immediate cost advantages but hidden challenges lurk.

PRLog - Nov. 28, 2012 - DURBAN, South Africa -- The proliferation of tier 2 delivery locations in offshoring destinations such as India and the Philippines result in immediate cost advantages but hidden challenges lurk.

“India and the Philippines emerged in the late 90’s as preferred destinations for global companies looking to outsource their work to a low cost destination,” observed Mr Patrick David, Head of International Marketing & Sales at Coracall, a global Call Centre Company which has operations in the UK, South Africa, India and the Philippines. “As the industry matured availability of talent emerged as key challenge and outsourcing companies had to look further afield to source qualified and skilled people. As cost pressures mount a number of outsourcing companies set up operations outside of traditional metropolitan locations where infrastructure and labor costs were lower.”

A smart move? Not necessarily demurs Mr David. “Whilst India and Philippines have made huge strides in the provision of services to global customers, the fact remains, that outside of the metropolitan areas challenges remain on infrastructure quality, IT uptime and the quality of talent. There are a number of government initiatives currently in place by the respective governments of India and the Philippines which address these gaps however it may take a few years for a Tier 2 location to be on par with its metropolitan city cousin. Through experience rather than design outsourcing companies are now using Tier 2 locations for local and regional language support for domestic business where delivery norms and expectations are not so stringent.”

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"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward looking statements (within the meaning of Section 27a of the Securities Act of 1933 and Section 21e of the Securities Exchange Act of 1934) regarding our business, financial condition, results of operations and prospects. Forward-looking statements in this report reflect the good faith judgment of our management and the statements are based on facts and factors as we currently know them. Forward-looking statements are subject to risks and uncertainties and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements, as a result of either the matters set forth or incorporated in this report generally or certain economic and business factors, some of which may be beyond the control of Coracall. These factors include adverse economic conditions, entry of new and stronger competitors, inadequate capital to support operations and projections of revenues and profitability. Readers are urged not to place undue reliance on these forward-looking statements which speak only as of the date of this press release. We undertake no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of the press release.

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