Nearshore Americas

Calls To Replace Coffee As Main Product In Manizales, Colombia

Source: Inquirer News

In Manizales, in the heart of Colombia’s prime coffee production zone, officials have found the solution to volatile commodity prices and raging unemployment: call centers.

The city of 380,000 people – nestled in the Andes mountains in the central department of Caldas, about 175 kilometers (110 miles) northwest of the capital Bogota – is attracting multinational firms and putting residents back to work.

Authorities in Manizales did everything to keep the coffee trade afloat.

“We tried to increase production, the number of hectares used. We also tried to specialize in a quality niche coffee, but nothing seemed to work. Meanwhile, Brazil solidified its position as the world’s top coffee producer,” city mayor Juan Llano told AFP.

In 2005, the unemployment rate in Manizales had hit 20 percent, giving the city the dubious distinction of being among the top three cities in Colombia in terms of the number of jobless.

Llano then opted to follow an unusual model — that of India, a world leader in the global business outsourcing market.

He dreamed up “People Contact” — a government-run structure attached to city hall that offers call center services. Multinationals were drawn by the nearly neutral accent of Colombians in Spanish, and their good grammar.

“We offer tax breaks, we rent out fully-outfitted offices, and we also offer young workers, some of them bilingual,” explained Juan Cardona, the director of People Contact, which employs some 30 people to run about a dozen call centers.

The municipal government in Manizales – which has 11 universities – trained about 15,000 young workers in the tricks of the telemarketing trade, offering foreign firms a valuable pool of skilled labor. They took the bait.

Spanish firms Digitex and Emergia have 4,000 and 2,100 employees in the city, respectively. They offer services in Spanish to about 40 clients in Europe, the United States and Latin America, including AT&T and Movistar.

According to official city data, 9,800 jobs have been created in the sector in a four-year period. Seventy percent of those jobs have gone to women, many of whom have husbands who were laid off from the coffee plantations.

Local laws allow a 48-hour work week, at a monthly salary of $300.

“People here want to work. They really make an effort and our margins are excellent,” said Emergia director Benjamin Castro.

The city’s unemployment rate has dropped from 20 percent to 12 percent.

Llano now is looking ahead to his next challenge — building up a bilingual workforce to attract new business. He says Spanish after-sales services represent just four percent of the total market. The rest is in English.

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The local government is now paying for five hours of English lessons a week for 20,000 elementary and high school students attending public schools.

Manizales is not the only city in Colombia to catch the call center bug. Other companies have set up centers in Medellin, including France’s Teleperformance, which bought Colombian firm Teledatos.

In 2010, the sector generated $680 million in sales, against just $54 million in 2001. Over the course of that decade, the industry may have created as many as 73,400 jobs, according to the local call center industry body.

Kirk Laughlin

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

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