The Dominican Republic's decision to bet on the high-tech service sector has begun to pay off, gaining the country a growing reputation as an extremely viable destination for business process outsourcing (BPO).
Call center growth in the country has attracted industry attention as the Dominican Republic focuses on high-tech services more sharply. According to the Zagada Institute, a business development analytics firm, the Dominican Republic is the leading call center location in the Caribbean and Central America, followed by Jamaica, which employs roughly 10,000 agents throughout 16 centers, Panama with 9,500 agents, Costa Rica 4,500 and El Salvador with 4,000.
The report finds that the region's agent and business process outsourcing (BPO) talent base has grown from 24,000 since 2005 to almost 65,000 -- a 284 percent growth, and will exceed 101,000 by 2010. The numbers of call centers and BPO companies have also grown from 85 to 135. The economic impact has almost tripled from US$500 million in 2005 to just under US$1.5 billion.
The report highlights that with almost 50 percent of the agent and BPO talent capacity, and 57 of the region's 135 service supplier companies, the Dominican Republic has now surpassed Jamaica's 30 percent market share and its 24 service suppliers and has become the leading market.
"We are bullish on the BPO industry because we have seen the explosive demand for Spanish-language back-office, telemarketing and customer support services," said Eddy Martinez (executive director of the Dominican Republic's Center for Investment and Exports, CEI-DR) "We are now starting to reap the benefits of our investments in training and technology, and our positioning as the Spanish-language partner to countries such as India, who are global BPO industry leaders."
Through the foresight of Dr. Leonel Fernandez, the current President of the DR, many schools had moved forward on English language classes and as a result the universities provide a steady stream of students who speak excellent English, while at the same time providing them an opportunity to find work and perfect their language skills.
There are several other contributing factors to the Dominican Republic's emergence as a call center/BPO destination. Among them is the country's convenient proximity to the U.S. and Canada, which makes it attractive to U.S./Canadian-based companies that want their offshore operations to be "near-shore." The Dominican Republic is located less than 850 miles from Miami, or about a two-hour flight; less than four hours from Toronto. Additionally, the country's cultural affinity with the U.S. and Canada makes it easier to find skilled bilingual agents.
In addition, call centers that offer support for Spanish are growing by leaps and bounds. Outsourcing to countries with high quality, Spanish-speaking work forces is also on the rise (in terms of U.S. outsourcing, this may put a crimp in the popularity of India as a customer service outsourcing destination, as India does not generally offer European languages other than English).
Operating costs are also much lower than those of other destinations, such as India, Chile, Puerto Rico or Mexico. It is easier to find skilled bilingual agents, at a reasonable rate, as competitive wages in the Dominican Republic can be as much as 60 percent lower than the cost for a bilingual worker in the U.S. Accordingly, the costs to operate call centers in the Dominican Republic are the lowest among Caribbean locations.
While industry experts agree that India and China have led the charge in the development of the BPO industry, a geographical competitive shift has already begun to take shape.