India's BPOs Face Rising Manpower Costs, Lower Billing Rates as Economy Rebounds

Despite optimism stirred up by the recent economic rebound, India's technology-outsourcing companies may not be able to return to 30%-plus annual revenue growth without remodelling their business strategies, says the Wall Street Journal.


The Journal says that rising manpower costs, currencly fluctuations and sliding billing rates are some of the hurdles the companies will have to wrestle as they bounce back from the Great Recession.


To reduce manpower needs, Indian companies are considering software templates for specific industries, such as for insurance companies or auto makers. To address the currency-exchange risks, companies are "beginning to factor currency fluctuations into their discussions with clients so that prices can be renegotiated if the rupee strengthens significantly," says the Journal.


The rupee has strengthened in the past year to roughly 45 rupees per dollar, hurting the profits of all exporters, says the Journal.

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