Nearshore Americas

Big Indian Outsourcers go Shopping in LATAM

BANGALORE/MUMBAI: India’s top outsourcing companies are now exploring acquisition opportunities in the Latin American countries, as more customers demand nearshore delivery capabilities for physical proximity and ease of managing an outsourcing relationship.
Smaller service providers in Brazil, Argentina and Mexico such as Globant, which counts Adidas, LinkedIn and Citi among its top customers and has around $100 million in revenues, are increasingly being approached by some Indian tech firms, officials told ET on condition of anonymity.
“Even as we hire more locals, we continue to look at focused nearshore companies such as Globant for strategic alliances,” said a top executive of an Indian tech firm. He did not wish to be quoted because his company does not want to disclose its acquisition plans before they materialise. While customers such as GE and Citi continue to send more IT work to offshore locations such as India, some customers and vendors are discovering that nearshore locations in Latin America are offering almost similar cost advantages for back-office projects apart from better proximity to customers.
Customers such as HNI Corp, one of the biggest American office furniture manufacturers, recently chose a nearshore partner in Brazil instead of an outsourcing vendor from India because it was not comfortable with the time zone difference.
“While there is no doubt about Indian companies’ ability to serve customers across time zones, some customers still prefer to work with a vendor located nearer,” said an outsourcing consultant familiar with HNI’s decision.
For Indian companies seeking to serve customers locally and from nearby locations, outsourcing companies in Brazil, Mexico and Argentina offer lucrative M&A opportunities.

Sign up for our Nearshore Americas newsletter:

Kirk Laughlin

Kirk Laughlin is an award-winning editor and subject expert in information technology and offshore BPO/ contact center strategies.

Add comment