BPO in the Philippines has become incredibly popular. In the past, other countries were more well-known for their outsourcing potential. Places like India and Ukraine have been known for their ability to take over jobs in other countries, but in recent years, the Philippines has taken over as the world leader for BPO.
You may have heard of outsourcing in the Philippines and the recent
popularity of call centers in the Philippines. These two events are closely
connected. Multiple factors make the Philippines the perfect country for BPO.
But what is BPO, and why has this industry taken the country by storm and become
one of the nation's top industries?
In this article, we’ll discuss what BPO is in the Philippines and what you can anticipate will come next from Philippines call centers.
What is BPO?
BPO, also known as business processing output, is better known as
outsourcing. Business processing output is the process of contracting out
certain functions to a third-party holder. These third parties operate in the
Philippines, addressing the needs of companies, usually in other countries.
There are many sections of a business that can be outsourced. Examples of tasks that can be outsourced through BPO are customer service, IT support, accounts payable, employee recruitment, content marketing, and sales research. These tasks are taken care of by skilled professionals that work for a third party and are in another country.
Why Do Companies Use BPO?
For the most part, companies use BPO to save money on sectors of their
business. Aside from this, there are many reasons why a company might choose to
use BPO. They may need assistance with sections of their company and don’t have
the resources to hire new staff, or they may need additional sales leads and
don’t have the team to pursue them.
BPO is an effective way of saving money in a business. Hiring a third party to take over sections of operations eliminates overhead costs, saves time, and puts a company ahead of the competition. Conversion rates are another way businesses can save money, based on the value of their home country’s currency and the value of the currency in the BPO country. Estimates of outsourcing to the Philippines can save about 70-80% of salary costs.
History of BPO in the Philippines
The Philippines first started offering BPO to clients in 1992. In just 30
years, the industry has grown from brand-new to world-renowned. In 1999, the
first call center was set up in the Philippines. In the next year, 2000, the BPO
industry was just a sliver of the country’s GDP output at 0.075% of the
country’s economic production.
The industry quickly blossomed. By 2010, 525,000 employees were working in call centers in the Philippines, and by 2016, there were over 1 million Filipinos employed full-time in the BPO industry, and revenue was growing by 17% each year.
As of 2023, the business process outsourcing industry contributes a whopping 9% of the Philippines’ GDP. Now, the Philippines is known for BPO, and the earning potential of outsourcing has become well-known in the country. The industry is projected to rise from 1.3 million people and add another half a million jobs within the next couple of years.
Working at call centers or other outsourcing companies is highly sought after by Filipino residents. These jobs are considered skilled work that pays very well, and the competition for each position is high.
The Philippines government has many laws catered to making the BPO industry thrive, offering incentives and tax breaks to improve the infrastructure of BPO and continue to encourage growth.
Types of BPO in the Philippines
While there is certainly a variety of outsourcing tasks that Filipino outsourcing companies take care of, there are types of BPO that the Philippines specializes in. These areas of interest include:
- Customer support
- IT and software development
- Data mining and data input
- Game development
- Animation services
- Human resources
- Medical transcription
These services are typically offered by businesses known as call centers, which operate as facilities that can address multiple companies abroad and provide various services. Some of them, such as Loop Contact Solutions, are used by major corporations and businesses of all sizes, while others cater only to smaller firms.
Why Are Philippines Call Centers So Popular?
The Philippines is known for its call centers due to the quality of their work. Customer satisfaction needs to stay the same or better when outsourcing, and Philippines call centers are known for doing so because of a few important factors.
Fluent English Speaking
People in the Philippines are highly proficient in English. As children, Filipinos learn English alongside their native language and work on the language throughout school. The percentage of people in the Philippines proficient in English is more than 95%, and the Philippines is the 3rd largest English-speaking country in the world.
Close Cultural Connections
Close cultural connections exist between the Philippines and Western countries, especially America. Filipinos take in the same media, are fans of the same celebrities, and the cultural similarities run even deeper and have been studied by social scientists. Cultural scientists agree that the two countries share many emotional and cultural similarities.
Skilled Educated Workers
Filipino workers are also considered highly skilled. Education is prioritized in the Philippines, and most call center employees are college educated. The country has emphasized and invested money into ensuring its citizens receive college degrees and other forms of post-secondary education. In fact, there are so many skilled and educated workers in the Philippines now that 40% of Filipino workers are overqualified for their current positions, according to PhilStar.
Highly Competitive Hiring Practices
As we mentioned, job positions for call centers in the country are highly
competitive despite new positions rapidly opening as the industry expands. One
of the main reasons why call centers in the Philippines are so advanced at
providing outsourced support is that the best of the best in the job market are
hired to work in call center positions.
Hiring requirements are strict for these call center positions. Loop Contact Solutions requires that new employees be fluent in English, have a college degree, and have at least 6 months of experience working for American clients in another call center. After meeting these requirements, candidates must be interviewed, take an English test, take a typing test, and perform trial calls and email scenarios.
Standard of Training for Employees
Additionally, some call centers even go the extra mile after hiring. Call centers like Loop Contact Solutions enforce rigorous training programs to train individual employees to work for client businesses. Loop Contact Solutions continues to train employees and expects a 90% or better quality result from its employees.
Expectations for the Future of Philippines Call Centers
The growth of Philippines BPO and Philippines call centers is not expected to
slow down anytime soon. In fact, the industry has seen nothing but positive
impacts during the COVID-19 pandemic due to letting employees work from home and
continuing to produce positive output for its clients.
Americans are especially big fans of the work that the Philippines call centers perform, and American clients are expected to continue using the services of call centers in the Philippines. According to Nexford, 85% of outsourcing work that the Philippines takes on comes from the U.S., and there are plenty more U.S. companies that need BPO services. As Filipino BPO companies continue to perfect their processes, the Philippines will continue to see the acquisition and retention of contracts from other countries.
Why Should People Hire Philippines Call Centers?
The Philippines is now truly the BPO capital of the world, and the call
centers in the country are trustworthy, competitive, and professional. Filipino
call centers are trusted by big-name international brands, including Weiss
Ratings, Nesmax, Stock Investor, and Scholarship Owl, which all use Loop Contact
Solutions to acquire clients, retain business, and grow their companies.
Compared to American call centers, Philippines call centers are more professional and skilled and save companies more money while helping them make more money through excellent customer service and expert sales lead strategies.
Overall, the Philippines is the gold standard for call centers and BPO. In
just 30 years of growth, the country has exceeded all expectations for quality,
services, and revenue. Philippines call centers and the Filipino BPO industry is
only improving with time. The business model is secure, and the companies in
business in the Philippines so far have generated standards that rise above
Interested in saving money on customer service and sales lead generation? Loop Contact Solutions is prepared tob e the call center that handles your day-to-day customer interactions with our trained, Americanized staff. Loop Contact Solutions is a full-service call center that offers premium outsourcing with a focus on growing and expanding the potential of a business.
If you want to learn more about what Loop Contact Solutions can do for your business, contact us today for a free 60-minute consultation phone call.