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Honduras Making Strides as a Contact Center Delivery Location

I recently visited San Pedro Sula, Honduras, with CMS vendor Alorica. This nearshore America delivery location offers a low cost, educated workforce with strong native neutral Spanish delivery, as well as emerging support for English and Portuguese. The country is in the process of making English its official second language.

Honduras, and specifically the city of San Pedro Sula, have battled negative perceptions which stem from statistical data indicating high murder and kidnapping rates as well as a military coup and near civil war in 2009. The Honduran government understands that they still have work to do to reduce crime rates, and believes education and job creation are key components to making this happen.

Honduran President, Juan Orlando Hernandez, studied in New York and is aiming to put the Honduran education system on a par with the U.S. His educational initiatives include a bonus system for teachers meeting the curriculum, and a target student graduation rate of 98%.  Currently 80% of the country’s public schools have computers and internet access. In November 2014 the Honduran government signed an agreement supporting a program to train English teachers, in which 116 trainers will train 1,000 teachers. High school students (preferably 9th grade and up), contact center and BPO employees, and mono-lingual high school or college graduates are targets for this program.

The centerpiece of hi-tech business in San Pedro Sula is Altia Business Park, the first class A sustainable technology park in the region, which includes smart city amenities. This was the brainchild of Yusuf Amdani, CEO of real estate and textile company Grupo Karim, whom I met during my visit. His vision to create a smart city in San Pedro Sula began in 2007, starting with $25m of investment. To date, the smart city has created ~19,000 jobs.

Amdani has focused on creating opportunities in contact center services, initially targeting the telecommunications industry due to its maturity in contact center outsourcing. 

Grupo Karim operates the services Altia Business Park offers to its tenants, including recruitment, support with all legal processes to start operations, floor plan designs, and construction support.  Its tenants’ employees have access to a variety of social facilities and a shopping and lifestyle center in the smart city. From a contact center perspective it has a strong foundation, with current tenants including several large U.S. based organizations such as Alorica, Convergys, and StarTek.

Altia Business Park currently has three office towers, is planning to build a fourth tower for completion by the end of 2015, and then a further two towers thereafter. Altia also plans to replicate the smart city in Tegucigalpa, the capital of Honduras, in 2015. Nicaragua and El Salvador are also being considered by Altia for smart cities. 

UNITEC University is located in the smart city and is affiliated with Laureate, an international private network of universities. It offers graduate, undergraduate, and vocational programs. At the end of January 2015 it plans to launch a vocational program to prepare students to work in the contact center industry, focusing on English, IT, empathy, and soft skills.  It will take students a year to 18 months to complete the program and it has a goal to enroll 500 students.  A scholarship program is in place for students from public schools.

According to the Asociacion de Maquiladores and the Altia Business Park, in the region of forty U.S. companies are conducting business in San Pedro Sula, including Texaco, Holiday Inn, McDonald’s, Hilton, Tommy Hilfiger, Office Depot, NCR Corporation, Marriott, Fruit of the Loom, Lear Corporation, Burger King, and Citi Bank. 

The following outsourcing vendors are operating in San Pedro Sula (with estimated headcounts): Allied Global (~2,000), StarTek (~1,000), Collective Solutions (~1,000), Convergys (~600), KM2 Solutions (~350), Myron (~150), Alorica  (~120), Zero Variance (~100), Levanter Global (~85), and Serve 5 (~50).

Alorica opened its contact center in San Pedro Sula in May of 2014. It has the capacity for 630 seats at the site. It currently has ~120 filled and looks to bring the site close to capacity in 2015. It is primarily targeting clients in the telecommunications, cable, satellite and hi-tech industry sectors.

Companies that have already made the decision to outsource contact center delivery to Honduras include Kyocera, Time Warner Cable, Sirius XM, Straight Talk Wireless, Tracfone, Blue Fusion, Greyhound, AT&T/AIO-Cricket Wireless.

In summary, Honduras (and specifically San Pedro Sula) is making strides to become a viable location for contact center services. Specifically:

  • It is currently a viable delivery location for Spanish-speaking services
  • With its focus on accelerating English-speaking capability, it promises to become a more viable location for English language contact center services in the near future
  • Security and crime remain areas for improvement in Honduras, but the government’s focus on education and job creation, particularly in the hi-tech services industry, with some early successes, suggest that the country will emerge as an attractive nearshore service delivery location.

Comments to this post:

  • Great insights Vicki. The material improvement in the crime issue, as it relates to risk, will be a game-changer for this destination. The partnership and support from Grupo Karim also makes a huge difference; they are very invested in the success of Altia Park.

    Jan 12, 2015, by Scott Wilson

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