IBEX Arrives in Nearshore, Doubling Down on Nicaragua and Jamaica

Following 30% topline revenue growth, IBEX Global is setting its sights on nearshore expansion as part of its growth strategy going forward. A new 500-seat delivery center in Managua, Nicaragua, set to open at the beginning of November, will complement additional expansion in Kingston, Jamaica, where an innovative 1.7 acre campus environment, will house 650 to 800 agents across three centers. The three Jamaican centers will open in October and December 2015 and April 2016 respectively.

In an exclusive interview with Nearshore Americas, Robert “Bob” Dechant, who joined IBEX Global as CEO in May, highlighted the importance of these new centers, which have begun hiring, in IBEX’s overall strategy.

Dechant aims to take it “to the next level”, and nearshore expansion is a core part of that. With just under $240 million in revenue, 90% of the company’s business services clients in the US market, with sites in the US and Philippines. The Nicaragua and Jamaica openings mark IBEX’s first move into the nearshore.

He said that although the company is not necessarily top of mind in the industry, the strong relationships they have built with their existing Blue Chip clients and their optimistic, strategic vision of nearshore delivery make them a formidable player.

“My belief is to be an even stronger provider for US-centric clients, we need to also have a nearshore presence. You need to be a player of credibility in the [nearshore] market,” Dechant said. The Stream Global Services and Qualfon veteran has extensive experience moving into new markets, specifically Guyana, and building the French-speaking market.

Nicaragua is a great extension of the ‘bilingual corridor’ for the Spanish-English voice market

Dechant said that he has seen how companies have been winning as the nearshore market starts to grow. “It has grown at 35% over the past five years and I am pretty convinced it will continue along that trajectory, if not more,” he said. “We had a gap in our service offering. My strategy was to solve that very fast.”

Two Markets, Two Solutions

IBEX’s strategy is to build around an initial play with eyes to continued large expansion in the nearshore market. The goal is to solve two things concurrently: something in a Spanish-speaking country with strong bilingual English-Spanish skills and an English-only site in the region.

“We have two centers in Texas, and so Nicaragua for us is a great extension of what I will call the bilingual corridor that allows us to give great price points for clients to service their English work, and grow and expand the Spanish market. It extends our US centers to that market,” he said.

The shine has worn off India

Jamaica is in a completely different plane. “I see it as a complementary location to the Philippines. It is English only and is the third largest English-speaking population in the Western hemisphere. You can really scale a lot of English for your clients that are looking to balancing their portfolios of nearshore, onshore and offshore. It offers high-volume English play,” Dechant added.

Dechant said that in terms of the Spanish-speaking market, they could have looked at El Salvador, Colombia, Guatemala, and many others, but they felt that Nicaragua was probably the best market for the first move. “It is a known market, it is a fairly safe market, that maps out to what our clients are looking for, and it is not over-saturated yet. There is still growth in the country,” he said.

He added: “Once we get Jamaica and Nicaragua in place – those proven markets – the next phase is moving into ‘tomorrow’s market’. This is not a one-move chess match; it’s a multiple move chess match. We will be looking to move into disruptive, emerging markets.”

Eyes on Disruptive Options

While Dechant is holding his cards close to the chest in terms of naming the markets he has his eye on, he describe the characteristics he is looking at. As in Dechant’s experience of building in the then-unknown market of Guyana, the key is a great labor force, lower cost structure than other markets, emerging technology infrastructure and no trailblazer in the market.

“It [Guyana] became a market where you could easily scale to a 2,000 to 3,000 seat labor force and still have room for competitors,” he said. “The dots I am trying to connect are: what markets can you have a big impact in creating really meaningful jobs and do it at good price points.”

The next phase is moving into ‘tomorrow’s market’

Dechant sees companies like IBEX Global playing a role in developing the needed infrastructure in an emerging market – whether that is fiber going into the market, dual fiber so you can have redundancy for your clients, or centers with power back-up to ensure reliability. “Some emerging market aren’t there, but a company like IBEX Global can play a role in that,” he said.

For Dechant that elements to consider in terms of those markets that are on the curve to making those investments are:

• Scalability;
• Infrastructure;
• The right cost structure; and
• Ability to solve the language requirements.

Dechant highlighted English, Spanish and French language skills, in particular. “I think the French market is really important because of Canada. My feeling is that Canadian companies have pulled back from African investments in Tunisia and Morocco. There is great opportunity to solve those French language requirements in the nearshore,” he said. Farther afield, IBEX has its own Senegal center that Dechant could potentially see also playing a role in servicing the French and French-Canadian needs.

Beyond India

We believe we are going to continue to grow at well above market growth

IBEX Global’s strategic move to the nearshore is informed by Dechant’s own belief that the “shine has worn off of India.” He explained that today the Philippines has 1.2 million jobs, most of which have migrated from India. “India for voice is the least preferred market; non-voice options such as chat and text are fine, and the back-office is a great market, but for voice India is not the top option anymore. While the luster has not worn off of the Philippines, the nearshore offers strategic advantage and is positioned for even greater growth going forward.

Dechant has been impressed with the talent pool in the two countries. Hiring has started for both locations and in the case of Kingston, the site for the Jamaica center, they are hiring individuals that have nursing degrees who are looking for good jobs.

“They want to leverage some of their training. They can either look for a job in the States, which some of them do, or search for options in Kingston. There aren’t many nursing jobs in Kingston, so this will have a really big impact,” he said.

The Kingston campus environment will house three centers with common areas in the middle where there is a restaurant and other facilities. “We are offering good food and a great environment,” Dechant said.

Geared For Growth

Nearshore is critically tied to IBEX’s strategy of continued growth. Dechant emphasized that although projections for growth across the industry have been at between five and seven percent on average, real growth, if you look at earnings of the big players, has been negative or at one to two percent. IBEX Global for the past three plus years has been growing at greater than 30%.

We have been growing at ten times the market rate

The growth, Dechant said, has been driven extensively by the company’s largest clients who are in the Blue chip brands. “We have grown with them. But we have also brought in new business in strategic verticals, namely banking and financial; travel and entertainment; automotive and transportation, and insurance.”

He places the keys to success for this growth at the feet of IBEX’s value proposition: a combination of performance and price. “Because we are a leaner, faster, more flexible business, we can meet client objectives efficiently, and we are able to do it at better price points than larger players,” he said.

Dechant said that nearshore is going to continue to fuel the growth. “We believe we are going to continue to grow at well above market growth,” he said. The Nicaragua site is launching with a new client, which Dechant said is testament to the reputation IBEX has built in the market. “We have been growing at ten times the market rate. Whether we will continue at ten times remains to be seen, but we are confident we will continue to out-perform the market.”