Tuesday, September 24

Growth Slows For Morocco’s Outsourcing Industry

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Financial Times
www.ft.com
Heba Saleh

Morocco

Kinza Malih, an employee at a call-centre in Casablanca, Morocco’s economic capital, puts on headphones and prepares to call a list of people whom she describes as “VIP clients” in France.

Identifying herself as “Caterine” — a name intended to be familiar to French clients who do not know that she is calling from Morocco — she responds to queries such as over the delivery date of a sofa or refund on a jacket ordered from French online retailer Showroomprive.

“Even when I finish my studies I will go on working at the call-centre,” says Ms Malih, who is aiming to secure a masters degree in economics. She earns around $600 a month from her job at Outsourcia, a Moroccan business that employs 800 people. It provides a range of call-centre, e-commerce and other back-office services to major French companies such as Total, the oil company, Carrefour, the supermarket chain, and Orange’s Moroccan affiliate, Méditel.

Outsourcia is part of the kingdom’s growing outsourcing sector, which grew from 300 employees in 1999 to 70,000 now. Last year it reached $780m in revenue. Segments of the Moroccan outsourcing market, which mainly caters to French companies, are seen as saturated. Annual growth of the industry dropped to around 5 per cent last year, after hitting 15 per cent in 2011. But officials and industry insiders say rising demand for more sophisticated services, such as business process outsourcing, will allow them to attract new clients.

Youssef Chraibi, president of Outsourcia and head of the Moroccan Association for Customer Relations, says there are two major trends limiting growth in the call-centre business.

First, competition between French telecoms operators, which account for half the market in Morocco, has led to cost cutting and in some cases customer care moving online from phone-based helplines. Second, Moroccan back-office service providers face competition from cheaper service providers in other francophone African countries.

The main hurdles, he says, are that French companies are still not very accustomed to outsourcing their back-office process. Laws that protect jobs in France are sometimes a barrier, and in Morocco there is a dearth of some of the skills that are needed.

Mamoune Bouhdoud, Morocco’s deputy minister of industry, acknowledges the challenges. He says the government is about to sign an agreement with private operators offering support to the sector for it to grow and create more jobs.

“We will have more engineers, more legal people, more IT people,” he says. “It’s a huge opportunity for Morocco.”
FT Special Report

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King Mohammed VI (centre), his son Prince Moulay Hassan (left), his wife Princess Lalla Salma (right)
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GFI Informatique, a French provider of IT services, launched an affiliate in Morocco in 2003 that employs 240 local engineers. It offers IT outsourcing for clients such as BNP Paribas, Thales, La Poste and Yves Rocher, a French cosmetics group.

Saloua Karkri-Belkeziz, president of GFI Maroc, says Morocco has political stability and enough well-trained young people to allow it to capture 15-20 per cent of the French market in IT services if backed by proper marketing, training and legal reform.

Ms Karkri-Belkeziz notes that Morocco has already achieved its aim of training 10,000 engineers, but that the country needs more.

“We also need more competitive prices for telecoms,” she says, adding that this is part of a plan being discussed by the government and private sector companies that is due to be signed by April.

“We should act on our competitive advantage to [keep] the companies we have here and attract new ones.”

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