Business Process Outsourcing is gradually attaining a significant force in the market, supporting international companies and businesses. It’s an emerging force that is not only assisting small to large enterprises, but also reserving its own space in the market.
A recent release of its market report has crystal clear story of its success and exponential growth rate in the BPO sector. And its scalability is going to consistently expand over the next decade. The expectation is that its size and market value is likely to inflate from its value of $245.9 billion to $544.8 billion by the year 2032. It’s all covered with an 8.5% compound annual growth rate (CAGR) in the report.
This very report has in-depth analysis of its market according to its service types, operating models, end-users and insurance, healthcare, manufacturing, IT & telecom, retail and region.
Let’s bring some top statistics related to this BPO market in the spotlight, which are some findings mentioned in the report. It’s based on the 2022 market and its trends anticipated for the span of 2023 to 2032.
- As per 2022 BPO market analysis, which is based on BPO revenue share:
- Top Service Type is customer service, which is expected to cover a 31% of BPO market share by 2032.
- Top Operating Model is the cloud technology, which is anticipated to cover a 69% of BPO market share by 2032.
- Top End-User Type is the IT & telecom sector, which is going to cover a 34% of BPO market share by 2032.
- In terms of revenue, north America is likely to account for a 35% of BPO revenue.
The BPO market analysis is based on its segmentation across types, deployments, organization sizes, verticals, and regions. Let’s have an overview of its segmentation.
- Market subcategories: Its market types encompass finance & accounting, marketing & sales, customer support, training & development, human resource & recruitment, document management & processing, and other outsourcing services.
- Deployment Subcategorization: These subcategories include on-premise and cloud-based/BPaaS.
- Organization & vertical subsets: These organization sizes are further split into small, medium, and large enterprises, while verticals segmentation constitutes BFSI, IT & telecommunications, retail & consumer goods, manufacturing, healthcare & life sciences, government & defence, and others.
- Region subcategories: These are further subdivided into North America, Europe, Asia-Pacific, and the rest of the world.
Why is this industry growing rapidly?
A number of reasons are blowing up its market size. The topmost cause is the rising demand for assistance in conducting non-core tasks. Businesses of all sizes require outsourcing assistance in managing their back office tasks, which directly influence their market and efficiency. Although knowledge process outsourcing companies are standing in parallel, giving BPO industries a cutthroat competition.
For sure, the leverages and advantages of business process outsourcing companies are contributing to their popularity as strategic partners for services seekers. This is definitely a concern because data-powered business entities are outnumbering. They seek assistance in advanced analytics that these outsourcing partners provide to make informed decisions. They are equipped with upgraded tools to get into in-depth insights of operations, resources, assets, inventories, and many other things. This rich knowledge helps in discovering the latest development and outstanding trends taking place in the data and analytics world.
Another big reason of its enhancing influence is an overwhelming requirement or demand for IT and telecommunication services. Global businesses are investing in these BPO services so that they can access a robust cybersecurity framework, achieve transparency on everything going on their networks, and inflating their reach to international customers or partners.
In addition to a few typical driving forces, such as cost-effectiveness, flexibility, scalability, and effortless access to advanced technologies and expertise, there are some more drivers. These are government-backed favourable policies, seamless exposure to experienced and skilled specialists, and a progressive approach that can help businesses to attain continuity post COVID-19.
If you specifically consider the case of north American BPO companies’ high growth rate, it is likely to hit 9.7% CAGR during that forecast span. This anticipation is based on skyrocketing demand for business process solutions by large technology-based companies. Also, the inclination to cloud technologies and customized solutions have made this sector achieve aggressive growth rate.
In the case of asia-pacific region, its growth rate is projected way more than the growth rate of north America. It’s 10.2% CAGR. Here, global companies seek more strategic solutions to defeat the challenges of high in-house labour cost and increasing requirement of skilled workforce. Because of these benefits, some bigwigs are likely to invest more in digital solutions providing BPO companies over the anticipated period.
We should not forget that the radius of cybercrime is consistently increasing, which certainly leaves sensitive information exposed to cyber spies. Regulations are continuously upgraded in many countries where outsourcing companies are located. These are some obvious risks that are highlighted as big challenges for its market growth.
Industry Trends Are Contributing to BPO’s Success
Slowly and gradually, the adoption of digitization is reaching a new height. It is certainly offering golden opportunities for these outsourcing units. Global businesses are trying hard to revive their traditional operations. In this effort, they are aggressively embracing automation, AI, IoT, cloud, and other emerging workflows. This is simply because these technologies are able to enhance business processes efficiencies, making them more intelligent. Customers, employees, suppliers, and partners all require transformation, which has become the need of the hour to achieve business continuity. And, businesses have started inclining to digital transformations so that they can have better productivity & enhanced customer experiences. To make these all achievable, the demand for outsourcing partners in IT & telecommunications is at pinnacle, which is contributing to market growth.
Strategic business partnerships also emerge in a crucial role, evolving significantly over the years. And, BPOs are living up to these expectations by consistently delivering their best efforts. Because of this reason, financial organizations have observed improvement in their efficiency through smart methods and intelligent workflows.
Conclusion
The business process outsourcing market is going to break its all records because of its tendency to provide technical and strategic assistance to global business entities.