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March 3, 1999


By CBR Staff Writer

The Merchants Group Ltd, the UK provider of call-center services, has announced that it has integrated its consultancy with its core Managed Services business. Founded in 1981, by current managing director Martin Hill-Wilson, The Merchants Group is based in Milton Keynes, UK and has offices in Cork in the Republic of Ireland. The company provides services aimed at the deployment of call-centers, from initial consultation to facilities management. The new integrated offering incorporates implementation, systems integration, e-commerce capability and training. This means that the company can provide the expertise and equipment for a client wanting to open its own call center or to outsource, enabling Merchants to run a client’s call-center from its own communication centers.

Merchants runs three communications centers, running customer helplines for clients such as pharmaceutical firm SmithKline Beecham, Mercedes Benz, and the Cellnet/Barclaycard partnership. When, for instance Barclaycard customers phone the helpline operated by the Merchants Group, they will believe they are talking to a Barclaycard office in their native country. A Merchants spokesperson said: We can take calls in over 25 languages. If a customer calls from Finland, the call will be answered by a native Finn, even though they are actually calling Ireland. And the customer will think they are talking to somebody in Finland.

Since February 1997 the Merchants Group has been 75% owned by Data Dimension Holdings Ltd, an IT group listed on the Johannesburg Stock Exchange. The remaining 25% remains owned by Merchant staff and management. Johannesburg-based has been snapping up services companies globally for the past five years. In 1994, the group formed EDS Africa, a joint venture with Electronic Data Systems Inc. DDH has also bought SPL and The Internet Solution, both South African services companies. The group has also branched into Australia and Asia, with controlling stakes in Com Tech Communications, Datacraft Limited, a listed Australian systems integration company which in turn owns 55% of Singapore-listed Datacraft Asia.

The Merchants Group does face stiff competition, however, from rivals such as US-based Sitel Corp, which bought into the UK with the purchase of Mitre Plc in 1996. Sitel dwarfs Merchants in terms of size, geographical spread, workforce and revenues. It also includes Olivetti, Philips, British Gas and One2One among its customers.

In October 1998, Merchants Group published a call-center benchmarking report, which surveyed over 200 call-centers around the world. The report found that 47% of the call centers in the survey were growing at between 20% and 100% a year, with 6% growing at over 100%. Merchants claims to be growing at around 42% per annum, well above the average growth of 30%-35% its benchmarking report found. The UK magazine Marketing reported Merchants’ 1997 revenues at 26.7m pounds, with a pre-tax profit of 2.8m pounds, compared to 1996 revenues at 18.8m pounds, with a pretax profit of 1m pounds.

This article is part of ComputerWire’s European Computer Services information service. Some articles from the service are being provided to ComputerGram subscribers for a trial period only.

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