Kencall sees the growth of new local outsourcing opportunities as telecoms companies realise call centres are not core business
With the arrival of the new international fibre cables, Kenya’s pitch to become one of continental Africa’s leading BPO centres may at last be gaining some traction. Kencall has been in the business for five years already and is noticing that it’s getting an increasing number of East African as well as international clients. Russell Southwood spoke to its CEO Nick Nesbitt about how the business is developing.
Kencall has been in business for five years offering outsourced call centres to a wide variety of companies in the UK, USA and Kenya. Its largest client is Orange and one of its fastest growing customer segments is telecoms. Other customer segments include financial services, retail and healthcare.
“Our focus started with US and UK markets but to our surprise, East African markets are growing quite rapidly. Foreign companies have global mandates to present their brands the same way globally and they can use us to do that in this region. Local companies now also want to do the same thing.”
Kencell’s services go from selling to customers in the first place to retaining them after the sale has been made. So on the sales side, it helps clean up databases, set appointments for sales representatives and carry out phone sales. On the service side, it helps answer customer’s questions and offer technical support where needed.
The company currently has a 250-seat call centre in Nairobi but is looking to open two more “driven by demand”. It has a client (in Kenya) that wants it to take over its existing call centres. The argument that companies are finding compelling is that running line managers and call agents is not their core business, so why not outsource it? Companies invest a lot in call centre infrastructure without necessarily understanding how to manage the “soft” people part of the process.
So does Kencall have plans to expand outside of Kenya? “We’ve no concrete plans currently but we’ve had invitations from people in Nigeria, Ghana and Mozambique. So these are preliminary discussions which we make take up next year.”
According to Nesbitt, bandwidth limitations have not really constrained the business:”We’ve had no problems at all. We used to have expensive but reliable satellite bandwidth. There was also expensive equipment to overcome latency”.
“Now the two new international cables mean that we have unlimited bandwidth and prices have gone from around US$6,000 to US$600 per month. We have multiple providers and we use Orange and KDN, who also provide the last mile. For satellite, we use Vizada. It’s VoIP calling and pretty much everyone has moved to VoIP.”
The Kenyan outsourcing market has been good at pitching its wares but to slow to grow. Nevertheless Nesbitt is optimistic:”It’s a very attractive market as far as client work goes. But it’s a difficult and complicated business to run.” So his advice to local entrepreneurs?:”If you have money, put it into something you understand. Don’t go into call centres unless you know what you’re doing.”
But how does Kenya rate competitively against much more well established international outsourcing destinations?:”India as an outsourcing destination is extremely compelling. But outsourcing your business there is not for the faint of heart. In Kenya, the people are good, there’s easy access by plane, affordable bandwidth and good office spaces. It’s also a good place to live when you come to train staff.”
So how do the clients see coming to Kenya?:”The proof is in the pudding. They’ve picked it because it’s a good place to go. Clients see it as being on the cutting edge. It’s a new market and you don’t get fired for going to India. But for those who choose it, they want to be first in and they want to be somewhere that has a low attrition rate and where they’ll still treated as somebody special. They get to meet the President.”
But what about the competitive claims of the other African destinations?:”South African labour costs are about twice as much as ours and our bandwidth is much cheaper. But it has a large and fairly mature local market. Mauritius is also quite attractive but also expensive. Nevertheless they’re doing quite well with multi-language”.
“There’s a lot of stuff in the press about Ghana. They’ve done a good marketing job but they have one or two large customers but they’ve not got more. You need knowledgeable entrepreneurs to get business. Most of them stay as expats in the USA. I ran a large part of a telco for 20 years.”
But isn’t 250 seats quite a modest business compared with other outsourcing locations?:”It depends on your appetite and your dreams. If I kept ticking over at 250 seats, I’d make good money. The more you go up (in size), the more cash you need. It’s like hotels, if you have 150 rooms, you stop. With call centres, you keep adding ‘rooms’.”
“If you want to go after the big accounts, you need to keep adding seats. We’re having a conversation with BT about moving 600-1,000 people. But that’s only possible for a limited number of companies. The average now is 50-100 seats globally.”