ONTARIO
From Site Selection magazine, November 2007
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Center of Contact

The Ontario call center sector is strong,
but the falling U.S. dollar poses questions.

Aditya Birla Minacs' new Mississauga contact center.
Aditya Birla Minacs will eventually employ 1,000 at its new Mississauga contact center.
Photo by Kara Williams, Governor's Photographer

by JOHN W. McCURRY,
john.mccurry bounce@conway.com


O
ntario has long been a major center of contact center investment. One of the most active firms of late in the province has been Aditya Birla Minacs, which has opened new centers in Mississauga and Hamilton.
Jeff Williams, Aditya Birla Minacs
Jeff Williams, executive vice president, sales and marketing, Aditya Birla Minacs

   India's Aditya Birla Group acquired Minacs Worldwide in 2006. The idea for an expansion into Mississauga developed during a trade mission by Premier Dalton McGuinty to India earlier this year. There, McGuinty and Sandra Pupatello, Ontario's minister of economic development and trade, met with senior officials of Aditya Birla. The Mississauga contact center opened in September with 300 employees, with the goal of creating another 700 jobs by June 2008.
   "Mississauga represents a real interesting opportunity for us," says Jeff Williams, executive vice president, sales and marketing. "The greater Toronto area is probably one of the most cosmopolitan and culturally diverse places I have been to on the planet, especially in terms of access to different types of skill, particularly in languages. One of our customers has a requirement for 19 languages, and the Toronto area offers not only the breadth of population, but a critical amount of diversity."
   Williams said the other driving factor for Mississauga is the same as other locations: competitive landscape, industry saturation statistics, relative industry wage rates and access to a good building. Williams, who says the center is rapidly ramping up employment and will reach capacity during the first half of 2008, says he is confident his company will meet its multi-language labor requirements.
   The Hamilton center, located on the Highway 401 corridor between Toronto and Detroit, goes back to Minacs' automotive roots.
   "Automotives was our first vertical market and makes up a large percentage of focus and revenues," Williams says. "That's how we got started in Oshawa and Pickering and it continues to make up a large percentage of our focus and revenues. Hamilton provides a number of attractive things in addressing an automotive customer, such as an overall population of half a million. We felt that the labor value for the dollar was excellent and the standard of living is high. Access to education and infrastructure is good. We've been evaluating Hamilton for a number of years and it fit."
   From the mid 1990s and into the early 2000s, the exchange rate of the U.S. dollar vs. the Canadian dollar was a big driver for U.S. firms to invest in Canadian call centers. Now, with the exchange rate virtually on par, other factors will drive future growth, Williams says.
   "There is still an opportunity to capitalize on a relatively high standard of living and standard of education that is typical in Ontario. We will target higher value opportunities going forward. We are very comfortable with the existing profile of business we have here and certainly have no plans to move out due to a foreign exchange issue. But we are mindful that any expansion has to be the right value-added proposition for ourselves and our customers."
Honda Canada
Honda Canada will consolidate Toronto-area facilities into a new corporate campus in Markham in 2009.


Honda Picks Markham
   Markham, one of Ontario's fastest growing cities, will be home to Honda Canada's new head office when it opens in 2009. Jim Miller, Honda Canada's senior vice president, says the company's new campus will include a four-story office building, an R&D facility and a parts distribution facility.
   "Initially, we will house about 500 people and most will be existing jobs," Miller says. "Obviously, by the time we get in there we will continue to grow. Now we are out of space."
   Honda Canada chose the 47-acre (19-hectare) site because of its visibility to a major highway (Highway 404) and its good transportation access, Miller says. The footprint of the new facility will make for better distribution, he says.
Rieter's facility in Changzhou
Jim Miller, senior vice president, Honda Canada.

   "It has easy access from all directions," Miller observes. "Right now we are on a rectangle and we will be moving to a square, which is far better for warehousing."
   Honda Canada looked at several sites before narrowing to a list that also included nearby Richmond Hill. The process took about a year, he says, but the company realized the need for a new facility about five years ago. The new campus will consolidate three existing facilities in the area, he says.
   Honda's campus will house three separate but interconnected buildings. The four-story office building will be LEED-certified. Honda, which employs more than 5,000 in Canada, produces about 390,000 vehicles annually at two manufacturing facilities in Allison, Ont.

Food Sector Growing
   Food processing is Ontario's third largest manufacturing sector behind transportation and electronics. The Ontario government estimates there are more than 3,500 food processing firms generating more than 120,000 jobs.
   Kellogg Co. is opening a new 200,000-sq.-ft. (18,580-sq.-m.) cereal production facility in Belleville. Kellogg's already has a plant in London. The Belleville plant will employ about 100.
   "The Belleville site was the right choice for a number of reasons including convenient transportation routes, total cost to manufacture and the support provided by the city of Belleville, Bay of Quinte region and province of Ontario," said Jeff Montie, president, Kellogg North America, at the time of the project's groundbreaking.
   Maple Leaf Foods, one of Canada's largest food processors, is building a $12-million food innovation center adjacent to its existing office tower in Mississauga. It expects to open the facility in early 2009.
   Nealanders International, a Toronto-based supplier of food ingredients and additives, has added more than 85,000 sq. ft. (7,900 sq. m.) to its corporate headquarters. The project includes blending rooms, warehousing and an R&D facility.
   Ferrero Canada, which opened a huge factory in Brantford late in 2006, is expanding with a $55-million Confectionary Center of Excellence to develop new products and processes.

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