Skip Navigation LinksMerchants-South-Africa-holds-all-the-offshoring-cards-vf Opinion piece | South Africa holds all the offshoring cards


With cost pressures building up again, offshoring your contact centre can be justified only if it eases the strain on your bottom line either by being unusually cost effective or actually making a contribution to revenue by delivering customer service that drives customer loyalty.

To achieve either of these outcomes you need an offshoring destination that offers worthwhile incentives as well as operators in that destination that can provide you with all and not just some aspects of a competitive advantage.

So says Sandra Galer, Consulting Director at Merchants, Southern Africa’s largest and oldest business process outsourcing (BPO) and customer experience specialist. Merchants operates a number of contact centres on behalf of companies in the United Kingdom and Australia as well as contact centres for some of South Africa’s largest blue chip companies. Based on its ability to help its clients give their customers superior service, it has the unusual distinction in the BPO industry of retaining its customers for ten or more years, with most of its offshore clients having renewed their relationships several times.

“South Africa as an offshoring destination has the whole-hearted support of government, not just in terms of incentives for bringing your business to South Africa but also in terms of its own strategic focus on increasing 
employment opportunities for young people and developing skills among disadvantaged people.

“Offshoring is not a nice to have for South Africa. The country’s sustainability is predicated on proving to international communities that it is a business destination of choice. The contact centre industry is one of government’s flagships in this context and organisations therefore find themselves in a welcoming legislative and regulatory environment that includes the pro-active development of talent.

“So, both strategically and operationally, offshoring to South Africa assures clients of distinct advantages in the fundamental areas of people, process, and technology.” 


Contact centres are labour intensive. Some 70% of costs are bound up in employees. South African wages, as related to the cost of living, are comfortably competitive.

“More to the point, when you correlate the wages with the level of skill that customer service representatives bring to the table, a good cultural fit for European and American customers, and the neutral accent of the agents, then the value our people contribute to contact centres is unmatched,” Galer says.

In South Africa, the language of business, sport, and mass entertainment is English. South Africans share a passion for the same types of sports – such as cricket, rugby, and football – as many people in the global north, south, and west. All of which enables South African customer service representatives to relate easily to the people they serve and, therefore, provide a high level of contact comfort.
In addition, South Africa has been home to contact centres for global organisations for more than fifteen years now. Expertise at all levels of the contact centre is deeply embedded. Client organisations are not guinea pigs.

“South Africa as an offsh​oring destination has the wholehearted support of government, not just in terms of incentives for bringing your business to South Africa but also in terms of its own strategic focus on increasing employment opportunities for young people and developing skills among disadvantaged people.

“Also, by nature and by experience, the South African workforce doesn’t just accept things at face value,” Galer says. “If something the client organisation wants is unlikely to work, we’ll ask questions and offer alternatives that we know will be more effective. In fact, our offshore clients often use us to benchmark a process precisely because we provide input.” 


A good indicator that South Africa is a good offshoring destination is the pleasure with which client executives visit their contact centres there. 

As Galer says: “The government is stable and, although the economy is in a zero growth phase, investors understand its potential. There is a good population size, ensuring an ongoing supply of talent. There is a good work ethic, quality universities, and an excellent feeder system to the universities from the schools. People know they need a matric to get a job and, as employers, we know what we can expect from a matric student.”
South Africa also has a distinct time zone advantage, able to service its clients to the north, west and east in sociable hours and, thereby, avoid the human resource costs of agents working nights. 


South Africa’s technology infrastructure is strong, particularly in cosmopolitan Cape Town, which tends to be the country’s offshoring hub. Five international broadband cables have their landing points in Cape Town, ensuring good connectivity to the rest of the world.

Easy broadband access also ensures that contact centres can offer and integrate all customers’ modern channel choices. This reduces the cost to serve, empowers the measurement of performance and service levels, and significantly enhances productivity in the contact centre.

Most of the world’s top technology companies are represented in South Africa, many of them using the country as their springboard into Africa. Contact centre operators can, therefore, obtain up to date technologies and the relevant support for them.

As a result, the South African contact centre environment is both sophisticated and competitive. By providing multi-channel and omni channel facilities with a central point of communications for customers, operators are able to cost-effectively address one of the most difficult challenges currently confronting companies around the world.

“There is more to offering multi and omni channel operations than technology, however,” Galer says. “You have to recruit and retain agents who know how to deliver exceptional customer experiences across all the channels. You have to choose and train them carefully.

“We are fortunate in South Africa in having long experience and high skill in agent recruitment using a broad range of interfaces, from physical and online agencies to platforms like LinkedIn. We also rely heavily on referrals from our own staff, because new recruits from this source tend to know what the job entails and what is expected of them.

“At Merchants, we also partner closely with organisations like Harambee, which get young people ready for the workplace, particularly those from disad​vantaged backgrounds who have matric qualifications but haven’t necessarily had exposure to computers or the Internet and don’t know how to write a CV or participate in a job interview. Partnering in this way gives us access to a much wider scope of talent while also enabling us to contribute to South Africa’s development.” 


When Merchants first ran the AOL contact centre in 2004, it introduced a four-week training programme for agents in the so-called soft skills, systems, and products. This turned into an industry benchmark, with many operators snapping up Merchants-trained agents and adjusting their own training regimes to match the Merchants standard.

“We have maintained our training leadership and momentum, focusing today on giving client service representatives the very different skills needed to manage communications in omni-channel environments,” Galer says.

“We also provide training that will help us retain staff by pro-actively preparing them to move into positions such as team leader or quality assessor when those jobs fall open.

“And, we provide exceptional physical environments, with recreation areas, for instance, that mitigate the stresses under which agents work and make them want to come to work. 

“Overall, we build loyalty to our contact centres and to the brands that agents service. Which means that we provide a standard of service-based offshoring that operators in other regions simply cannot match.”

South Africa has been recognised several times as an offshoring destination of choice. It’s 2012 National Outsourcing Association (UK) Offshoring Destination of the Year Award was a first for the country, followed by the European Outsourcing Offshoring Destination of the Year award in 2013, and the 2014 National Outsourcing Association (NOA) Professional Awards Skills Development Programme of the Year award in 2014.


Merchants is a recognised global leader in providing customer management and related business process outsourcing solutions that deliver positive business results. Providing flexible access to technology, facilities and people, we enable companies to keep pace with – and exceed – customer expectations.
Merchants is a Dimension Data company – the world’s leading contact centre systems integration business and part of the NTT group. 

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In addition to helping you identify the future needs of your customers, Merchants is able to source, build, manage and support all aspects of your entire contact centre infrastructure requirements – from technology hardware and software to buildings and facilities. 

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