Indian Outsourcing Firms Pursue Target

India’s leading technology firms are pursuing Target for a multi-million dollar outsourcing deal. The United States’ second-largest retailer currently has a center in Bangalore wherein it has 1,500 employees working for the software development and maintenance operations.

According to the Economic Times, an executive from one of the interested IT companies said that they have had a dialogue with Target for a few months, but negotiations on a possible contract are still in the early stages. The executive declined to be identified.

Tata Consultancy Services (TCS) and Wipro are among the technology companies that are wooing the Target deal, which was reportedly valued at $300 million to $400 million. TCS and other Indian IT providers have also been involved in other IT outsourcing deals with international retailers such as Home Depot from the US and Tesco from the United Kingdom. These top retailers also have captive facilities in India in to support their IT systems and advance applications. Tesco reportedly cut more than $100 million of its annual costs by outsourcing its IT work in India.

Target could also generate $100 million every year from cost reductions, according to a person familiar with Target’s operations in India. The American retailer began operating its captive unit in India in 2004 through a consortium with ANSRSource, a BPO company based in Texas.

Targets operations from its Uruguay and Chile delivery centers are being serviced by its provider TCS. Meanwhile, the discount retailer announced its Q2 revenues of $14.6 billion.