There are several reasons the Philippines is recognized as the “Call Center Capital of the World”. The country has skilled workforce, low costs of living, a supportive infrastructure for business, and a favorable business environment, the nation has become a top destination for those looking to invest in business process outsourcing (BPO).
If you are one of the many keen on exploring the business process outsourcing (BPO) industry in the country and have asked, “How to start a call center in the Philippines?”, this guide aims to show you how to create your own call center business in the Philippines: from registration to hiring employees and finding office space.
Develop a comprehensive business plan
Deciding to start a call center in the Philippines would take several steps and the first step is to create a business plan which would help anchor your business operations.
Having a plan in place helps map out your company model, expenditure needs, investment scales, target market, charging scheme, and other operational details.
Remember to include in your plan:
• The setup for your call center in the Philippines (An on-site call center vs. A virtual one)
• What your call center would focus on (Outbound Calls vs. Inbound Calls)
• What industries you will be servicing (Financial institutions, E-commerce, Medical billing, Customer Service, etc.)
• Business structure and legal entity formation
• Tax compliance considerations
• Understanding the complexities of business registration and compliance
Set a Budget
Next, it’s important to ensure you have enough budget to finance your call center’s operations.
A good ballpark figure is to start with at least ₱500,000 – ₱800,000 or roughly $10,000 – $15,000. This money will cover initial expenses such as business registration and licensing fees, equipment purchases (phone systems, computers, etc.), furniture, and office rental and utilities. You’ll also need operating capital for salaries for employees who will be working at your new call center in the Philippines.
Of course, the amount will depend on the size of your company and the services you will be offering, which would then determine the type of systems and tools you will be needing, among others.
Here are some more ways to use this amount:
Find a strategic location for your call center office
When finding the perfect place, the old real estate adage still rings true: It’s all about location, location, location. To get your money’s worth and to ensure you’re creating a great workplace for your employees, ideally, your call center should be within reach of major transportation hubs in the country — best if it’s within a 30-minute drive from the airport so you could easily travel to and from the US.
Take note also of the surroundings of the prospective location: is it near a mall or a commercial area? This would make for an ideal location as your employees can buy things they need, like food and other essentials.
You’ll also want to find an area with plenty of residential housing options so you can hire local talent who live nearby — they might even have family members who could join your team.
Another crucial element to look at in a potential location is the IT infrastructure. Make sure the office space is big enough for your employees and has good internet and telecommunications connectivity. This way, you won’t have difficulty setting up your computers, network, telephones, data centers, and security systems. Also, make sure that the office space has all the utilities you need to run your operations smoothly, such as electricity, plumbing, etc. See if there’s still a lot of installation work to be done or if the space is ready to move in.
A look at PEZA Special Economic Zones
In the Philippines, PEZA Special Economic Zones are areas around the country designated by law — the Republic Act (RA) No. 7916 known as the Special Economic Zone Act of 1995 — to foster economic growth and industries.
The Philippine Economic Zone Authority or PEZA is an agency attached to the Department of Trade and Industry tasked with promoting business investments, providing assistance, granting incentives, and facilitating the operations of investors in PEZA Special Economic Zones or ecozones.
These ecozones are spread out across the nation in locations chosen to boost the economic activity in the area. Within the National Capital Region are several prominent ecozones that are known for being business and commercial centers, some of them listed here:
- Rockwell Business Center in Makati City
- UP-Ayala Technohub in Quezon City
- Eastwood City CyberPark in Quezon City
- Strata 100 in Pasig City
Outside of Metro Manila, there are many more designated ecozones to choose from, including:
- Carmelray International Business Park in Calamba City, Laguna
- Golden Mile Business Park in Carmona, Cavite
- Matina IT Park in Davao City
- Clark Freeport and Special Economic Zone in Tarlac and Pampanga
- San Carlos Ecozone in San Carlos City, Negros Occidental
Aside from service providers, other industries that may apply under the PEZA include those involved in tourism (including medical tourism), agro-industrial businesses, logistics and warehousing services, software development, and utility companies.
To qualify for the program, a business entity must comply with the requirements from PEZA which vary depending on the applicant’s industry. For those engaged in IT-BPO services, these are the requirements they need to submit for approval:
• A duly accomplished application form (notarized)
• Your company’s corporate profile (including that of the parent company, if applicable) which should include:
• A brief history of your company
• Existing or proposed business activities and projects
• Affiliated companies registered with PEZA
• Affiliated companies registered with the Board of Investments (BOI) and copies of their Certificates of Registration with Terms and Conditions and annual reports, if applicable
• Principal officers and bio-data
• Audited Financial Statements from the last 3 years for existing companies
• SEC Certificate of Registration and updated Articles of Incorporation
• Board Resolution authorizing the filing of PEZA application and designating the representative(s) authorized to transact registration with the agency
• Project Brief (i.e., Information on Market, Technical, Financial, and Management aspects of the business to be registered)
Upon submission of the requirements, the application will be assessed by the PEZA Board before approval. A PEZA Board Resolution will be issued once the application has been accepted. The agency may then, if necessary, request additional requirements.
The approval comes with several incentives that make it such an attractive prospect for investors, which include:
• Income Tax Holiday of up to 7 years
• Tax and duty-free importation of equipment, machinery, or spare parts
• Special multiple-entry non-immigrant visas for foreign investors and their immediate family members
• Employment of foreign nationals in supervisory, technical, and advisory positions
• Long-term land lease of up to 75 years
Apply for government permits and registrations
Beyond applying for PEZA recognition, which you only need to secure if you plan to set up in an ecozone, there are legal requirements such as government permits you must apply for to start a call center in the Philippines.
Foreign companies looking to invest in the Philippine BPO sector must comply with foreign investment regulations, ensuring alignment with local business processes and regulatory compliance standards. Additionally, ensuring tax compliance is crucial for avoiding legal issues and maintaining smooth operations. To legally operate a call center, you must register with Philippine government agencies:
If the business will operate as a sole proprietorship, you need to register your business name with the Department of Trade and Industry (DTI). On the other hand, you must register with the Securities and Exchange Commission (SEC) if your company will be incorporated as a corporation, partnership, or association in the Philippines.
Meanwhile, to secure your company’s unique Business Tax Identification Number, you also need to register your call center at the Bureau of Internal Revenue (BIR).
The next step in the process is to obtain permits from the local authorities where your call center is located.
The Local Government Unit (LGU) where your company will be based will require your call center to submit:*
• Your business name registration
• Lease contract
• Location clearance
• Barangay clearance
• Public Liability insurance
*Note: Companies under PEZA are exempted from these LGU requirements.
Define Your Range of Services and Find Clients
Once your call center is set up, define the range of services you will offer. These may include customer service, technical support, lead generation, and more. Staying updated on industry trends will help you remain competitive.
Hire and train employees
If you want to start a call center in the Philippines, as business owners it is crucial to hire employees who will best fit your company’s business objectives and business goals. At this point, you will need to revisit your business plan. Consider your target client and the services you plan to provide to find the best talents that fit those targets.
But as a general rule, choose employees who have strong English skills and are willing to learn new things. Your call center employees should be able to work long hours and in teams, so look for those who are team players and possess positive attitudes.
Occasionally, you may send your employees to headquarters for training and exposure, so make sure to hire people who are willing to travel abroad.
Look for clients and let them know how you can serve them
Finding clients can be done through digital marketing, networking, and leveraging social media. A strong online presence will help attract businesses seeking a reliable service provider. Highlighting your outsourcing services can further enhance your value proposition to potential clients.
Conclusion
Starting a call center in the Philippines may have a lot of requirements, but it can be a truly rewarding experience for your business.
The Philippines has been nicknamed the “Call Center Capital of the World” because it has so many different types — from small companies with 10 employees up to huge multinationals that employ thousands upon thousands more Filipinos across multiple locations in the country.
Why do so many companies choose the Philippines as their base? With the country’s supportive and healthy infrastructure for foreign businesses, its low cost of living compared with other parts of Asia, and the smart and hard-working talent pool, you can’t go wrong with investing in this tropical country. Earn additional insights on hiring offshore workers in the Philippines. Read more on advantages, considerations, and best practices here.
Starting a call center in the Philippines involves prioritizing business success through strategic planning, investment, and regulatory compliance. Understanding the essential business requirements and leveraging available resources will further enhance your company’s stability and scalability.
By following the steps needed to start a call center in the Philippines, you can successfully launch and grow your call center in the country while ensuring long-term success in a competitive business landscape.
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