Setting up a call center? Think again--exec

By Erwin Oliva - INQUIRER.net

MANILA, Philippines -- A contact center business can bring in millions of dollars' worth of offshore outsourcing contracts to entrepreneurs planning to venture into this business, but a Filipino executive was quick to add that it is a risky business.

"The call center business is very capital-intensive. The business margins are high, but so is the risk," said Victor Endaya, president and chief executive officer of Advanced Contact Solutions Inc., as he reacted to he increasing tendency of local businesses to jump into the call center business bandwagon.

ACS, a Philippines-based contact center company that handles offshore projects, grew from a 500-seat contact center facility into a 7,000-seat facility, the executive said.

And yet, the company has kept its annual growth target very conservative. "We're looking at 30-percent growth every year," he added.

As the company grew, among the problems it encountered was raising additional funds to support its growth.

"This [business] is not for the faint of heart. If you only have P50 million, this is not the place for you. The barrier-to-entry is high, and so is the maintenance of operations," Endaya said.

Add to this is the pressure to hire more people, he said.

The executive pointed out that the Philippines is now the country of choice for offshore outsourcing of contact center services. But the demand is currently higher than the supply of people required to fulfill contract requirements.

The Contact Center Association of the Philippines expects the industry to generate revenues of about $8 billion in 2010.