Q&A: LATAM’s Currency Woes Make It Lucrative For Outsourcing

It seems that BPO firm Atento has its sights firmly fixed on Latin America as it expands through the region. The Spanish firm has added three major delivery centers and thousands of employees to its Latin American operation since it sold off its Czech Republic operations to Italian call center firm Comdata SPA last year.

Founded as a customer-care unit of Spanish telecom giant Telefonia, Atento has operations in just about every major city in Brazil and Colombia. In September, the outsourcer launched a call center in the little known Colombian city of Tres Nevados-Pereira and created more than a thousand jobs.  The new center was Atento’s third center in Pereira alone. Some reports say that Atento centers in El Salvador are a favorite hunting ground for job-seekers returning from the United States.

Last year, the call center firm’s Brazilian operation alone posted US$1.2 billion in annual revenue, a 7.5% increase in constant currency. In addition to Brazil, Colombia and El Salvador, Atento has delivery centers in Argentina, Peru, Chile, Guatemala, Panama, Mexico and Uruguay.

No doubt Atento’s expansion in Latin America picked up speed after it sold off its Czech Republic operations to Italian call center firm Comdata SPA.

Nearshore Americas spoke with Bruce Dawson, Atento’s US Nearshore Director, after the company added one more delivery center to its Mexican operation last month. He says 150, 000 employees, out of 160,000 global staff, are working in Latin America. Moreover, he says the more the US dollar rises against local currencies the more attractive the region becomes for US outsourcers. Dawson spoke about Atento’s optimism about Latin America, the company’s continued expansion in the region and the verticals experiencing greatest growth and demand.

Nearshore Americas: After you sold off your operation in the Czech Republic, you said you would focus on expanding operations in Latin America. How is this expansion program going?

Bruce Dawson: Over the last year, we have opened new customer relationship centers in Brazil and Colombia as well as a state of the art Operations Command Center and a Customer Experience Center in Mexico City. Atento’s position as a leading CRM/BPO provider worldwide is based on our large presence and market leadership in the Latin America region. We are the clear leader in the Latin America CRM/BPO market with approximately 20% of market share in the region and number one positions in key countries such as Brazil, Mexico, Peru and Chile.

We have a large customer base of blue chip brands across the region and a robust delivery platform encompassing operations in 11 Latin American countries (+ the US), over 75 customer relationship centers whose activity is monitored in real time from two state-of-the-art Command Centers located in Brazil and Mexico, more than 80,000 workstations and over 150,000 employees. These figures are just for Atento’s Latin American footprint.

NSAM: Atento is posting profit despite currencies in Latin America having hit a new low. How are you managing to weather this economic storm as far as your LATAM operation is concerned?

Dawson: We have been able to sustain a solid growth in the Latin America region despite a challenging macroeconomic environment. While we are not immune to macroeconomic conditions we are uniquely positioned to deliver more value to our clients by providing industry-leading customer experience solutions that leverage our leadership position, scale, vertical expertise and commitment to innovation.

The strong appreciation of the US dollar versus local currencies is increasing the attractiveness of Latin American countries as a nearshoring destination for companies in the US, adding to existing competitive advantages such as cultural, time and geographical proximity.

NSAM: How are macroeconomic issues hampering the growth of outsourcing service industry in Latin America?

Dawson: As mentioned before, the CRM/BPO industry is not immune to the macroeconomic headwinds especially in countries where our clients tackle decreases in GDP and higher inflation.  However, we are also seeing companies exploring increasing outsourcing opportunities as a way to drive efficiencies and accelerate their digitalization processes. Some companies look to outsource processes that perhaps they hadn’t previously considered outsourcing, and they come to us because of our unique expertise, solutions and regional scale.

And in other cases, there could be declines in real volume as business slows for some clients. Overall, the appetite for end-to-end customer experience solutions and other forms of business processes outsourcing, although not immune to the macroeconomic situation, remains solid, with companies more and more focused on improving efficiencies across their entire value chain.

NSAM: Telecom seems to be your biggest vertical. Which are the other major verticals you are focusing on in Latin America?

Dawson: Our two major verticals are telecom and banking & financial services; we are leaders in these segments in the region and we continue expanding this position by growing the share of wallet with existing clients, acquiring new clients and increasing the penetration of our higher-value customer experience solutions. Beyond telecom and banking & financial services, we have also vertical expertise and serve blue chip brands in sectors such as healthcare, utilities, retail and e-commerce, consumer goods, hospitality and tourism or public administrations among others.

NSAM: Is your strong presence in Latin America helping to win new clients in the US?

Dawson: Definitely. Particularly US-based companies nearshoring CRM/BPO services to Latin America. This is a strong market dynamic since Latin America is becoming more and more competitive for nearshoring. Key advantages including geographic and time zone proximity, access to a bilingual labor pool, strong cultural affinity, modernization of technological infrastructure and increasing economic parity with more distant offshoring destinations. This is a growth avenue with high potential for Atento.

Our longstanding presence and leadership position in Latin America goes back 15 years, but we only started to address the US nearshore segment very recently, in 2014. Over the last 12 months, we have ramped up our capacity to serve US companies from Latin American countries, building up dedicated capacity to serve this market in Guatemala, El Salvador, Colombia and Mexico. During this time, we have added roughly 1,300 seats to our US nearshore business and won contracts with key clients.

We have state-of-the-art infrastructure and a large pool of bilingual (English/Spanish) agents fully dedicated to managing customer relations for very prominent brands in the telco, retail and consumer electronic sectors in the US. We continue to leverage our market leadership and expertise in Latin America to help US based companies realize the value creation opportunities offered by the region.