Global Business Process Outsourcing (BPO) Market to Reach $215.9 Billion by 2026
SAN FRANCISCO, Aug. 5, 2021 /PRNewswire/ -- A new market study published by Global Industry Analysts Inc., (GIA) the premier market research company, today released its report titled "Business Process Outsourcing (BPO) - Global Market Trajectory & Analytics". The report presents fresh perspectives on opportunities and challenges in a significantly transformed post COVID-19 marketplace.
FACTS AT A GLANCE
Edition: 18; Released: May 2021
Executive Pool: 28132
Companies: 206 - Players covered include Accenture Plc; Alight Solutions LLC; American Data Exchange (AMDATEX); Atos SE; Automatic Data Processing, Inc.; Capgemini SE; Capita Plc; Ceridian HCM, Inc.; CGI Group, Inc.; Cognizant Technology Solutions Corporation; DXC Technology Co.; EXLService Holdings, Inc.; Genpact Limited; Infosys BPM Limited; International Business Machines Corp.; KARVY Global Services Limited; NGA Human Resources; NTT DATA, Inc.; Randstad Holding NV; Sopra Steria Group; StarTek, Inc.; Tata Consultancy Services Limited; TriNet Group, Inc.; Wipro Limited; WNS Global Services Ltd. and Others.
Coverage: All major geographies and key segments
Segments: Type (Customer Services, Human Resources, Finance & Accounting, KPO, Other Types); End-Use (Telecommunications & Technology, BFSI, Manufacturing, Retail, Other End-Uses)
Geographies: World; USA; Canada; Japan; China; Europe; France; Germany; Italy; UK; Spain; Russia; Rest of Europe; Asia-Pacific; Australia; India; South Korea; Rest of Asia-Pacific; Latin America; Argentina; Brazil; Mexico; Rest of Latin America; Middle East; Iran; Israel; Saudi Arabia; UAE; Rest of Middle East; Africa.
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ABSTRACT-
Global Business Process Outsourcing (BPO) Market to Reach $215.9 Billion by 2026
Business Process Outsourcing (BPO), a segment of outsourcing, is defined as a technique of delegating responsibility of a range of business processes to third-party service provider for a fixed consideration. Rapid increase in the size and scope of BPO industry is attributed to the growing desire of global businesses to rationalize costs and address issues such as shortage of skilled personnel. Various benefits offered by BPO including cost reduction, improved customer services, better focus on core businesses, competitive capabilities, and speed to market, have encouraged enterprises to adopt the outsourcing model. The BPO industry has been witnessing rise in smaller deals, hybrid offshoring, larger governance needs and reduced cost consultancy models. Concepts such as robotic process automation, SaaS, and cloud computing have transformed BPO practices, leading to better operational effectiveness and productivity.
Amid the COVID-19 crisis, the global market for Business Process Outsourcing (BPO) estimated at US$161.9 Billion in the year 2020, is projected to reach a revised size of US$215.9 Billion by 2026, growing at a CAGR of 5.2% over the analysis period. Customer Services, one of the segments analyzed in the report, is projected to record a 4.2% CAGR and reach US$69.4 Billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the Human Resources segment is readjusted to a revised 4.5% CAGR for the next 7-year period. Customer services BPO includes outsourcing services aimed at offering support for client's customer care operations as well as business processes pertaining to the customer contact center. This segment has now emerged as a major approach to deal with advanced, value-added functions that include customer care and analytics, consulting and implementation, and training and support. Human Resources (HR) BPO or HRO refers to the integrated operation and delivery of several HR processes, which are performed by a service provider on a contract basis. Common services covered as part of HRO contracts include employee benefits, payroll, recruitment, compliance, and training and development.
The U.S. Market is Estimated at $66 Billion in 2021, While China is Forecast to Reach $6.8 Billion by 2026
The Business Process Outsourcing (BPO) market in the U.S. is estimated at US$66 Billion in the year 2021. China, the world`s second largest economy, is forecast to reach a projected market size of US$6.8 Billion by the year 2026 trailing a CAGR of 6.1% over the analysis period. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 3.5% and 3.9% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 5.4% CAGR. Like other commercial enterprise functions, outsourcing was first conceptualized and implemented in the developed nations, which continue to wield immense authority in the worldwide BPO industry, even after attaining significant maturity. Outsourcing model is widely deployed across various business functions including accountancy, HR, production, customer relations, logistics, and warehouse management etc., as a cost-, time- and resource-saving method. Currently, the US constitutes the largest consumer of BPO services. The presence of a large number of companies with geographically dispersed business operations/units and employees in Latin America and Asia would enhance the demand for outsourcing services. Financial services and telecom industries are expected to offer potential opportunities for service providers in these regions.
Finance & Accounting Segment to Record 5.8% CAGR
Finance and accounting BPO (or FAO) involves handing over the responsibility and management of finance and accounting business processes to third party experts. Clients seek outsourcing services for F&A operations primarily to cut costs, reduce complexity of operations for the F&A department, and to comply with regulatory specifications. In the Finance & Accounting segment, complex processes such as external reporting, budgeting, accounting, planning, and forecasting continue to be outsourced due to the growing standardization of these functions. In the global Finance & Accounting segment, USA, Canada, Japan, China and Europe will drive the 5.6% CAGR estimated for this segment. These regional markets accounting for a combined market size of US$33.7 Billion in the year 2020 will reach a projected size of US$49.4 Billion by the close of the analysis period. China will remain among the fastest growing in this cluster of regional markets. Led by countries such as Australia, India, and South Korea, the market in Asia-Pacific is forecast to reach US$5 Billion by the year 2026, while Latin America will expand at a 5.1% CAGR through the analysis period. More
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