Tuesday, August 12, 2003
MNCs calling on Dalian for off-shore customer services
REUTERS
HONG KONG: Hello, Dalian? The name may not ring any bells to most ears, but a growing group of major western companies are discovering this bustling city in northeast China and quietly building it into the next big Asian telecommunications hub for offshore call centres.
The list of firms calling on Dalian, either directly or through contractors, for their off-shore customer service or helpdesk needs, in the past year includes Dell Computer Corp, General Electric and Motorola. Worldwide air courier FedEx Corp is also considering a call centre in the city, either directly or via a contractor, sources said.
The growth has been so rapid that telecoms giant British Telecom is looking into possible investments in the area, a spokesman said. In each case, the firms are using Dalian as a low-cost support centre for their operations in Japan, which lies about 1,000 km to the east.
Dalian is even closer to South Korea and many Korean firms are also said to be considering offshore call and back office centres in the city, according to industry executives. The city's development into a major call centre parallels similar trends in India, the Philippines and Singapore, whose abundance of English language speakers have attracted firms looking to support their US operations.
In a recent survey, India and China were listed Asia's top outsourced-call centre countries, with 96,000 seats in India and 38,000 in China, but most of the Chinese positions were believed to be local language operators. The Philippines was third with 20,000 seats. India's call centre industry was projected to grow 65% next year to 158,000 seats, and China's was expected to rise 41% to 53,500, while the Philipines was expected to grow to 40,000.
In most cases, customers call a local number in the United States or Japan and have their calls routed to off-shore centres without ever knowing it. "Dalian remains one of the cities closely tied with Japan," said Alex Wong, chairman of Hong Kong-based call centre operator 800 TeleServices Holding Ltd. "Relatively, it's a small city. But in terms of Japanese companies they have over 1,300. Lots of Japanese know Dalian quite well, and many were actually born there."
Dalian and large parts of northeastern China, once called Manchuria, were occupied by Japanese forces from 1931 till 1945. The area today is also home to Chinese nationals of Korean descent. Mr Wong's firm opened a Dalian call centre with Japanese partner Masterpiece Inc eight months ago and now employs about 70 people there, with plans to double the headcount by the end of the year.
Mr Wong and others said they have also set up call centres in other Chinese cities, but most of those are limited to Chinese language support due to limits on local talent pools. Like other off-shore call centre hubs, Dalian' s major attraction is its low-cost labour - a critical factor for the labour-intensive business, said Bennie Ho, secretary for the Hong Kong-based Call Centre Association.
Dell opened its Dalian centre last October, and uses it to provide back-office functions, including accounting and customer support, for its Japan operations, said spokeswoman Judy Low. She declined to say how big the centre is.
The move into Dalian coincides with an aggressive push into China by Dell, world's largest PC maker which has become China's number three PC seller with 6.2% of the market, according to data firm IDC.
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