Looking for a potential gold mine?
Says industry expert Rod Jones: "The opportunities in this industry are enormous. With the right strategic plan, entrepreneurs can have really successful businesses."
Jones, whose company, Rod Jones Strategic Solutions, trains companies and people wanting to run call-centres, says the sector has not nearly reached its potential in this country.
Two people who have made a success out of call-centres, what is called business-process outsourcing, are husband-and-wife team Jake and Rosa Orpen. The two started their company, Conexus, in March 2004 with three agents. Today the company employs 120 people and has a turnover of R15 million.
"That’s phenomenal growth in two-and-a-half years," says Jake.
He admits that the cost of getting into the industry is "a bit high for the man on the street". He and his wife, he says, "nervously" invested R300000 in their new business back in 2004, "but it was a chance we were willing to take".
Rod says that technology costs for a 50-agent call-centre will set an entrepreneur back at least R1m, with workstation set-up costs at about R10000 each.
The Industrial Development Corporation has a specialised Techno-Industries Business Unit, to fund enterprises in the information, communications and technology sector. Call-centres fall under this unit and are a top priority since government identified the sector as having the potential to fast-track job creation.
The unit makes loans of at least R1m.
Once funding has been secured, getting clients is the next step for the new call- centre. Conexus already had two clients when it was still setting up and was ready to open once the infrastructure was in place. Today it has clients in the insurance, automotive franchising and mortgage-originating sectors.
"The huge tragedy is that too many entrepreneurs in South Africa try to chase international business, and are virtually ignoring the many small opportunities domestically," says Rod.
Jake agrees, saying: "International businesses are very difficult to do business with because sometimes payment does not come through. There are also trust issues, which do not exist with our domestic clients. I’ll take a South African over an international client any day."
Unfortunately, the failure rate of new ventures and projects in the industry is 75%, says Jones. "It’s very high due to a lack of knowledge and adequate planning. Setting up and operating an effective, efficient and world-class contact centre is an extremely costly exercise," he says.
The government’s Accelerated and Shared Growth Initiative of South Africa has targeted the business-process outsourcing industry because of its potential to create jobs fast. So far the industry employs more than 65000 people in the country, according to industry body, ContactInGauteng and government hopes to increase this to 100000 by 2010.
– Courtesy of www.itsmybusiness.co.za
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