News : BPOs are Calling Out to the Entrepreneur in You!
August 20, 2010 -- India’s BPO sector is expected to spend over Rs.10,000 crore every year in various services to run their businesses smoothly—and this is expected to grow considering the fact that more and more work is outsourced to sweatshops in India to cut cost by global companies. The BPO boom has already created over four million jobs in allied services and businesses.
Network and application services
The backbone of a BPO, the network and application services is set to boom. If you have a model to support the BPOs, this is the place to be in. According to Desi S. Valli, Executive Director and COO, Net4 India Ltd, a company that helps call centers to set up their internal and external communication networks, with cost being an eternal factor in the books of a BPO, most of them would be looking at outsourcing network and application services to other companies. It is estimated that the licenses of simple applications to monitor inflow of calls are sold and managed for Rs.50,000 per month. In addition, hosted model, where IT applications and servers required for the functioning of a BPO is housed at an outside location, is becoming hot amongst Indian call centers.
Consider this. About one million youngsters needs to be transported in various cities in the country everyday to attend phone calls and e-mail queries from the US and Europe in the thousands of call centers. That too in multiple shifts. It is estimated that there are about 15,000 cabs currently running at breakneck speed to places like Gurgaon and Koramangala from city centers ferrying call centre agents. Erratic work hours and unavailability of public transport has meant the cab business has got a leg up. After salary of employees, transport is the biggest payout for any BPO and stands at about 12% of the total expenses. "The BPO industry means a lot to cab businesses or the so-called transportation services. I still remember when I started out, people used to think my business involves transportation through trucks, lorries, etc. Today, however, we all know that BPO has raised the bar of the business periphery," says Tarun Jain, Chairman and Managing Director, Legend Outsourcing Pvt Ltd. A startup in this space can earn anywhere from Rs.1 lakh-Rs.5 lakh in its first year of operation and may rise up to Rs.1 crore by the fifth year.
Facilities management (FM) is responsible for coordinating all efforts relating to planning, designing and managing buildings and their systems, equipment and furniture to enhance the organization’s ability to compete in a rapidly changing world. According to Parikshit Roy, Director and CEO, Vipul Facility Management, within the organized FM sector IT/ITeS industry vertical contributes to more than 50 percent of the revenue and growth potential. Most BPOs/ITeS businesses outsource a significant component of this non-care function. Based on trends and scope of FM service, providers in this sector cover services like housekeeping, maintenance and operations, front office services, horticulture, concierge services, liaison services and a host of such support functions. One can safely project a potential opportunity exceeding Rs.500 crore of revenue across the country for the FM services providers.
Every BPO has a cafeteria and it has always been a part of its culture to take care of its employees’ needs. While smaller vendors have been ruling the roost, institutional catering is fast turning into the next big thing in the Indian BPO industry, with players like Sodexho entering the market and multinational companies venturing or increasing their stake in the segment. The market for this service is huge. Gurgaon alone generates revenues of about Rs.1 crore every year in this space. A call center, for example, which employs approximately 1,500 to 2,000 people, would have at least 10 percent-15 percent of its employees using catering services. That itself would mean 300 clients per meal. So, even if a firm gets about 10 companies, it is clearly a huge client base. The institutional catering industry for BPOs is largely an unorganized sector in India, estimated to be Rs.100 crore.
They are hired in hordes. But every company follows its standard process to hire an agent. Typically an agent hire is likely to cost about four hours. BPOs, with their high attrition rates and need for training and coaching, are a HR services company’s good bet. As the BPO sector grows, the demand increases for services that go beyond just outsourcing payroll and benefit administration. Today, more functions such as training, recruiting and personnel development are being outsourced. TD Newton & Associates, which started its services in June 2008 from home, had to consider moving to an office when a deal to hire 1,000 frontline junior level staff came its way. Trupti Devpuria, its Co-Founder and Managing Partner, says that while they were already hiring for senior management levels for BPOs, the opportunity which came with hiring frontline junior level staff was great. "Per placement you would earn about Rs.5,000, provided the candidate stays with the company for 90 days. In 50 percent of the cases there is attrition within these 90 days. If you do well in a year you can expect Rs.20 lakh-Rs.25 lakh a year from a client," says Devpuria. If a startup can generate about 100 inductees a month, the sector is lucrative.
The BPO industry in India has provided a huge impetus to the security business. According to Harsh Wardhan, President & CEO, Securitas India, this is mainly due to the following facts: - BPO operations run 24/7: They need to maintain equal security requirements during both day and night. - Transport security (escort guards): This aspect was practically non-existent in the security industry prior to the entry of the BPO sector. BPOs have to cater to providing security personnel in cabs used for their pick ups and drops.
Posted by Veronica Silva Cusi, news correspondent
Contact Center World. (www.ContactCenterWorld.com), The Global Association for Contact Center Best Practices & Networking
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