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2014 Beyond BPO Services eNewsletter 
The old saying “Services are either growing or shrinking” has finally gone by th...
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The Future: Meier said he expects margin pressure to get increasing more difficult
especially in the North America lab...
Solving the Value Equation

What Do I Need
To Know To
Expand & Why?

When considering expansion, this is what you need to ...
Solving the Value Equation

What Are My Best
Growth Strategy
Options?

For a no obligation overview of the options in your...
Solving the Value Equation

Copyright Notice
Ephor reserves all copyright and intellectual property rights to the services...
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eNewsletter Beyond Payroll Services Ephor Group Garry Meier

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2014 beyond payroll services market landscape, market forecast. The future of BPO

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eNewsletter Beyond Payroll Services Ephor Group Garry Meier

  1. 1. `  2014 Beyond BPO Services eNewsletter  The old saying “Services are either growing or shrinking” has finally gone by the wayside and its associated legacy thinking that has inhibited us in the past.” said Meier. “This slow growth economy, the associated anemic labor markets and the increasing government burdens, coupled with the increasing workforce management complexities will continue to challenge us for quite some time.” The question is what can we do? Ephor Group Founder Garry E. Meier shares some of his findings, thoughts and conclusions to solving the many challenges facing us as service side executives, including growth & growth capital strategies, based on an eight month tour of operational, business process outsourcing (BPO) and support facilities in 13 countries in across North, Central & Latin America. Here’s the recap. Fast Stats:  The LATAM region has become a receptacle of some 120 new BPO facilities comprising approximately $350M in foreign investment in the past 2 years alone. Even with these impressive growth statistics in that region, Ephor Group has determined the total capacity utilization of BPOs in LATAM is in the lower 25% quartile, while the English speaking capacity utilization is even less. Of particular note, there exist a particular opportunity for the Healthcare Business Services BPO’s to expand and prosper in LATAM.  Payroll Services experienced less than 5% growth in sector demand in 2013 driven by an anemic job market & slow GDP growth; while Workforce Management (WFM) experienced greater than 25% Growth in sector demand driven by increased reporting, compliance & employment lifecycle requirements. This trend will continue for the near-term. Key Metric: COGS and Gross Profit Margin as a Percentage of Labor Costs, needs to be a real focus area. Don’t hire resumes first… create a more efficient and productive process… then the resumes. Key Performance Indicators: Ephor and its management teams measure the company’s business metrics at times daily, often weekly, and consistently on a monthly and quarterly bases. Our businesses are “Perform Businesses”. Meier said. “Find the top 8 to 12 key metrics that drive your business then focus the entire company on them. Get down to a unit-based economic systems — such as gross profit per person per hour."
  2. 2. `  The Future: Meier said he expects margin pressure to get increasing more difficult especially in the North America labor markets due to “the administration’s” increase in compliance, reporting and cost burdens. Therefore consolidation of especially “sub-scale” assets to formulate scaled assets will be mandatory for survival and wealth creation. Ephor suggest that specialized and focused BPO’s, SaaS, and cloud computing services will be areas of opportunity in the near-term. Meier concludes: “In my 38 year career I have never seen an economic cycle or time where well managed and resourced service organizations have not been successful” Additionally Meier said “Ephor clients typically acquire one, and many times two, companies per year. It’s not a roll-up strategy… it’s simply the execution of well thought out growth strategy.” Read more from Ephor Group online at www.ephorgroup.com/eresources.asp: BPO LATAM Nearshore Findings Beyond Payroll HRO Services BPO FrontOffice Contact Center CRM Services           For more information contact: Ephor Group Founder Garry E. Meier ephor[at]ephorgroup.com Speaking Topics: The Technology Oriented Business Services Environment: Growth Strategies, Growth Capital Strategies, Corporate Development Updates, M&A Activity and Sector Insights 
  3. 3. Solving the Value Equation What Do I Need To Know To Expand & Why? When considering expansion, this is what you need to know: Growth Capital Options Strategic Alternatives State Government Initiatives, Programs Local Tax Rules & Implications Corporate Development Options M&A Forecast & Valuations Forecast Financing Unit Economics Business Economic Cost Factors Industry Macroeconomic Factors Workforce Competencies Workforce Labor Supply Human Capital Supply Chain Labor Costs Market Analysis Job & Local Community Contacts For a detailed overview of your growth options, contact Ephor Solving the Value Equation ephor@ephorgroup.com 214.702.6427 24 E. Greenway Plaza, Ste. 400 Houston, TX 77046 www.ephorgroup.com www.ephorgroup.com ©Copyright 2014 Ephor Group, LLC. All Rights Reserved. 2
  4. 4. Solving the Value Equation What Are My Best Growth Strategy Options? For a no obligation overview of the options in your sector, contact Ephor Solving the Value Equation ephor@ephorgroup.com 214.702.6427 24 E. Greenway Plaza, Ste. 400 Houston, TX 77046 www.ephorgroup.com www.ephorgroup.com 1 ©Copyright 2014 Ephor Group, LLC. All Rights Reserved.
  5. 5. Solving the Value Equation Copyright Notice Ephor reserves all copyright and intellectual property rights to the services, content, information and data in this document. The contents in the document are protected by copyright and no part or parts hereof may be modified, reproduced, stored in a retrieval system, transmitted (in any form or by any means), copied, distributed, published, displayed, broadcasted, hyperlinked, used for creating derivative works or used in any other way for commercial or public purposes without the prior written consent of Ephor. Use of Information The contents of this document are provided to you for general information only and should not be used as a recommendation or basis for making any specific investment, business or commercial decision. These pages should not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the securities, and specifically funds or any investment products, mentioned herein, or, in any jurisdiction to any person to whom it is unlawful to make such an invitation or solicitation in such jurisdiction. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of you acting based on this information. All Limited Partner commitments must be made via fund subscription agreements. You should read the subscription agreements before deciding to subscribe for units in the respective fund. A copy of the agreements can be obtained from Ephor. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of the units in any fund and the income from them may fall as well as rise. If the investment is denominated in a foreign currency, factors including but not limited to changes in exchange rates may have an adverse effect on the value, price or income of an investment. Past performance figures as well as any projection or forecast used in this document, are not necessarily indicative of future or likely performance of any investment products. The information contained in these pages is not intended to provide professional advice and should not be relied upon in that regard. It also does not have any regard to your specific investment objective, financial situation and any of your particular needs. You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualified financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement. You are advised to read the Applicable Conditions governing the fund and the relevant Risk Disclosure Statement, if any, carefully before investing in any of our products. The contents of this document, including these terms and conditions, are subject to change and may be modified, deleted or replaced from time to time and at any time at the sole and absolute discretion of Ephor. Timeliness, Accuracy and Completeness of Information In particular, we assume no responsibility for or make any representations, endorsements, or warranties whatsoever in relation to the timeliness, accuracy and completeness of any services, content, information and/or data contained in this document, whether provided by us, any content providers or third parties. No Warranties While every care has been taken in preparing the contents contained in this document, such contents are provided to you “as is” and “as available” without warranty of any kind either express or implied. In particular, no warranty regarding non-infringement, security, accuracy, fitness for a particular purpose is given in conjunction with such contents. Ephor, their directors, officers, associates, agents and affiliates make no representations, endorsements or warranties of any kind about the services, content, information and/or data contained in this document. www.ephorgroup.com ©Copyright 2014 Ephor Group, LLC. All Rights Reserved. 3

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