Business Process Outsourcing (BPO) Market Trends and Analysis by Region, Service, Vertical, Enterprise Size and Segment Forecast to 2026
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How is our ‘Business Process Outsourcing’ report different from other reports in the market?
- The report presents in-depth market sizing and forecast at a segment level for more than 15 countries including historical and forecast analysis for the period 2019-2026 for market assessment
- Detailed segmentation by service segments (Customer Relationship Management, Finance and Accounting, Human Resources, Knowledge Process Outsourcing, Procurement and Supply-Chain, and Vertical-Specific BPO)
- The report also highlights key enterprise size segments (Micro (Less than 50), Small (51-250), Medium (251-1000), Large (1001-4999), Very Large (5000+))
- Detailed segmentation by vertical segments (IT & Telecom, BFSI, Healthcare & Pharmaceuticals, Government, Retail, Manufacturing, Energy & Utilities, Education, and Others)
- Detailed value chain analysis helping businesses identify areas where they can improve their efficiency and effectiveness, reduce costs, and enhance their competitive advantage
- The growth innovation matrix included in the report, divides the market players in to four categories i.e., flagbearers, contenders, specialists, and experimenters, which will help value chain participants in understanding how competition is performing based on their revenue growth and their R&D efforts
- Competitive profiling and benchmarking of key players in the market to provide deeper understanding of industry competition
We recommend this valuable source of information to anyone involved in:
- BPO Startups and Leaders
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Business Process Outsourcing Market Overview
The business process outsourcing market size will be valued at US$339.3 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 2.8% during 2023-2026. Outsourcing of business functions such as bookkeeping, HR activities, finance and accounting, research, sales, and marketing allows businesses to focus on core business activities essential for the growth of the organization. Additionally, outsourcing enables businesses to cut operational costs, gain access to skilled resources, enables diversification, and provide access to innovation, technology, and more, which is anticipated to drive the BPO market. The above-mentioned benefits have increased the demand for BPO services across various end-use industries, including BFSI, IT and telecom, healthcare and pharmaceuticals, manufacturing, and retail, among others.
Technological advancements and innovations have been at the forefront of the industry allowing BPO companies to maximize efficiency and optimize their capabilities. Technologies such as artificial intelligence, unified communications as a service (UCaaS) solution, cloud communication, data analysis, automated systems, and voice recognition are helping BPO companies enhance their service offerings and improve productivity. Artificial intelligence applications such as deep learning, robotic process automation (RPA), and machine learning in BPOs help automate various operations such as customer response, accounting, data analysis, and more, which enhances the customer experience. For instance, RPA enables BPOs to execute core business operations such as IT services, payment processing, regulatory compliance, quality assurance, and human resources with 100% compliance and accuracy and 24/7 availability.
Automation of front office BPO services such as marketing, sales, and customer communications spurs customer satisfaction by increasing accuracy, speed, and efficiency of service delivery. Business process automation enables BPO companies transform service delivery and operations, making them more flexible and nimbler, providing tech teams with time and bandwidth to address emerging customer needs by creating innovative solutions. Further, automation helps in enhancing security by providing control access to confidential systems and the right size information to contact center agents, helping them reduce fraud rates and errors.
Business Process Outsourcing Market Outlook, 2019-2026 ($ Billion)
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The business process outsourcing market size will be valued at US$339.3 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of 2.8% during 2023-2026. Cloud computing is another technology that has fueled the adoption of BPO services as it enables BPOs to offer business processes and IT software as a service. Cloud computing brings agility to the business as it provides businesses with on-demand access to IT and enables upward and downward scalability to customers, which gives them a competitive advantage. Further, cloud computing eliminates the upfront buyer costs helping BPO clients to reduce the total cost of ownership of IT services. Companies such as IBM and Wipro offer business process as a service (BPaaS) solutions in the BPO sector for analytical services. The BPaaS solutions utilize analytical technology and cloud computing to re-engineer existing business processes in enterprises, thereby helping them in managing critical business functions like finance, marketing, HR, and supply chain management.
Outsourcing compliance is becoming increasingly prevalent and mandatory over the years. Stringent data security regulations imposed by governments worldwide to ensure national security, privacy, and protection of intellectual property are expected to restrain market growth in the future. Outsourcing companies that feed on data face challenges in meeting regulatory compliance for data localization, storage, security, and usage. For instance, the Indian government introduced a Data Protection Bill in 2017, that includes guidelines around cross-border transfers, data breaches, privacy, BPO, data security, regulations, and other aspects. The data localization and cross-border data flow aspects of this bill increase the cost of BPO services while also increasing the technology and operational costs.
The BPO industry remained largely undaunted by the pandemic outbreak with COVID-19 acting as a catalyst for transformation of the traditional BPO models. BPO companies were quick to adopt new remote working models by making several digital and technological changes for empowering their workforce with essential tools. BPO companies localized the business continuity planning (BCP) in response to the pandemic by shifting the work infrastructure such as desktops and laptops to employees’ homes to form a distributed workforce. Collaboration tools like Zoom, Webex, Skype, and Hangout were quickly deployed by BPO companies to address communication issues while working remotely. With the help of technology, BPO companies continued to expand their capabilities to offer healthcare, voice IT, and BPM services, which kept the market upbeat during the pandemic.
| Market Size (2023) | $339.3 billion |
| Market Size (2026) | $368.5 billion |
| CAGR (2023-2026) | 2.8% |
| Forecast Period | 2023-2026 |
| Historic Data | 2019-2022 |
| Report Scope & Coverage | Revenue Forecast, Competitive Index, Company Market Share, and Growth Trends |
| Region Segment | North America, Western Europe, Central & Eastern Europe, APAC, South & Central America, and Middle East & Africa |
| Service Segment | Customer Relationship Management, Finance and Accounting, Human Resources, Knowledge Process Outsourcing, Procurement and Supply-Chain, Vertical-Specific BPO |
| Enterprise Size Segment | Micro (Less than 50), Small (51-250), Medium (251-1000), Large (1001-4999), Very Large (5000+) |
| Vertical Segment | IT & Telecom, BFSI, Healthcare & Pharmaceuticals, Government, Retail, Manufacturing, Energy & Utilities, Education, and Others. |
| Key Companies | Accenture Plc, AON Plc, Automatic Data Processing Inc, Capita Plc, Concentrix Corp, Conduent Inc, Genpact Ltd, Randstad NV, Serco Inc, Sitel Worldwide Corp, Tata Consultancy Services Ltd, Teleperformance SE |
Business Process Outsourcing (BPO) Market Segmentation by Service
The procurement and supply chain segment is expected to register the fastest growth of more than 8% over the forecast period in the BPO market. The growth of this segment is attributed to the growing e-commerce sector, which requires a streamlined supply chain in order to avoid delays in order fulfillment. Supply chain management is a time and cost-intensive process that directly impacts business performance. As such, outsourcing supply chain activities through third-party logistics (3PL) partners enables e-commerce and retail outlets to delegate time-consuming e-commerce fulfillment tasks and storage while focusing on enhancing supply chain velocity and saving money. Likewise, supply chain outsourcing in the manufacturing sector helps the organization to focus on production, and quality assurance of the products, thereby avoiding delays.
Business Process Outsourcing (BPO) Market Share, by Service, 2023 (%)
The growth of the above-mentioned segment is followed by the finance and accounting segment, owing to the outsourcing of several critical processes, including relocation, administration, KYC, payment processing, and compliance to regulatory policies being outsourced by banking and financial institutions. The human resources (HR) segment held a significant market share of the overall BPO market in 2023. Outsourcing the HR functions, minimizes payroll expenses and saves funds incurred for training the staff. Also, the large amount of documentation and legal paperwork requires a dedicated team to avoid any mistakes that can lead to a lawsuit.
Business Process Outsourcing (BPO) Market Segmentation by Enterprise Size
The very large enterprises held the highest market share followed by the large segment of the overall BPO market in 2023. BPO services have been prevalent in large organizations due to the benefits offered by outsourcing business operations. Large organizations have to handle several functions such as human resources, finance, marketing, and order fulfillment, which leads to inefficiency and loss of productivity and cost in case of errors. Further, hiring skilled professionals also incurs significant costs. Outsourcing enables large enterprises to focus on core tasks and innovation while delegating secondary tasks to third-party contractors, which helps in achieving efficiency and accuracy in operations while also gaining a competitive edge.
Business Process Outsourcing Market Share, by Enterprise Size, 2023 (%)
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BPO services are thriving in micro and small organizations as these organizations have limited budgets and outsourcing operations helps them achieve cost savings. BPO services experienced a surge in adoption during the pandemic with small enterprises outsourcing at least one business function. Outsourcing of IT services gained traction amid the pandemic with several startups and small businesses capitalizing on the BPO sector to address scale issues and facilitate cost savings, subsequently driving the BPO market growth.
Business Process Outsourcing Market Segmentation by Vertical
The BFSI segment accounted for more than 10% of the market share of the overall BPO market in 2023, followed by the IT & telecom segment. Several BFSI domains are outsourcing various processes such as asset management and investment management in order to enhance customer services. Outsourcing helps BFSI organizations in improving front-to-back processes, which in turn facilitates cost savings in investor services and security operation teams. Further, -outsourcing helps reduce revenue leakage and streamline processes in all the lines of banking business, which is another factor contributing to the high adoption in this sector.
Business Process Outsourcing Market Share, by Vertical, 2023 (%)
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The IT and telecom have been one of the leading sectors in adopting BPO services over the past few years. Telecom companies outsource several operations such as customer service, technical assistance, finance accounting, and lead generation, which help the companies in providing customer satisfaction and building a customer database. Additionally, outsourcing provides IT and telecom companies with access to skilled labor and new technologies required to enhance working speed and deliver enhanced output. BPO services have also been gaining traction in the retail and manufacturing sector for the past few years, with companies outsourcing bookkeeping and logistical operations, which bodes well for market growth.
Business Process Outsourcing Market Analysis by Region
North America accounted for the highest market share of the overall market in 2023. The presence of several major BPO companies such as IBM, ADP, and Accenture, catering to multiple business processes, has contributed to the market growth. Further, the US government has adopted protectionism strategies to boost economic growth and local employment, driving the growth of domestic BPO businesses. The European market also holds a significant market share owing to the quality of service and availability of skilled labor in the region.
Business Process Outsourcing Market Share by Region, 2023 (%)
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The Asia Pacific is one of the largest BPO market with the availability of a large pool of skilled resources and office spaces at relatively low cost. Companies in Western Europe and North America, which have to spend heavily on infrastructure, labor, electricity, and space, prefer low-cost outsourcing countries such as China, India, the Philippines, and others in the Asia Pacific, which has been driving the market growth. BPO companies in South and Central America have been gaining traction in the recent past due to an increase in demand for nearshore services from North America.
Business Process Outsourcing (BPO) Market – Competitive Landscape
The BPO market is highly competitive, with the presence of several large and medium enterprises offering a variety of outsourcing services. Major players in the market adopt inorganic growth strategies such as mergers and acquisitions, business expansions, and partnerships in order to gain a competitive edge in the market.
In addition to this, BPO companies are also introducing innovative solutions to gain a competitive advantage in the market. For instance, in January 2023, FoxHire announced that they will begin providing global Employer of Record (EOR) services in 80+ countries to their customers effective immediately. Covering 6 continents, FoxHire’s new offerings will enable employers all over the world to easily hire anyone, anywhere with ease. Powered by FoxHire’s EOR platform, customers can hire, onboard, and manage global employees all in one place. This new solution ensures local employment law compliance and streamlines the global expansion and hiring process.
Companies operating in the market have a stronghold in their respective service offerings. For instance, Accenture Plc, AON Plc, Automatic Data Processing Inc, Capita Plc, Concentrix Corp, Conduent Inc, Genpact Ltd, Randstad NV, Serco Inc, Sitel Worldwide Corp, Tata Consultancy Services Ltd, and Teleperformance SE are some of the leaders in the BPO value chain.
Leading Players in the Business Processing Outsourcing Market
- Accenture Plc
- AON Plc
- Automatic Data Processing Inc
- Capita Plc
- Concentrix Corp
- Conduent Inc
- Genpact Ltd
- Randstad NV
- Serco Inc
- Sitel Worldwide Corp
- Tata Consultancy Services Ltd
- Teleperformance SE
Other Business Process Outsourcing (BPO) Market Vendors Mentioned
Mphasis, Neusoft, Amdocs, Capgemini, CBRE, HCL Technologies Limited, Infosys Limited, SODEXO, NCR Corporation, Wipro, TTEC, WNS Ltd., Alight Solutions LLC, American Data Exchange, Ceridian HCM, Inc., CGI Group, Inc., DXC Technology Co., KARVY Global Services Limited, NGA Human Resources, TriNet Group, Inc., and Sopra Steria Group, among others.
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Business Process Outsourcing (BPO) Market Segments and Scope
GlobalData Plc has segmented the business process outsourcing market report by service, enterprise size, vertical, and region:
Business Process Outsourcing Market Service Outlook (Revenue, USD Million, 2019-2026)
- IT & Telecom
- Customer Relationship Management (CRM)
- Finance and Accounting
- Human Resources
- Knowledge Process Outsourcing (KPO)
- Procurement and Supply-Chain
- Vertical-specific BPO
Business Process Outsourcing Market Enterprise Size Outlook (Revenue, USD Million, 2019-2026)
- Micro (Less than 50)
- Small (51-250)
- Medium (251-1000)
- Large (1001-4999)
- Very Large (5000+)
Business Process Outsourcing Market Vertical Outlook (Revenue, USD Million, 2019-2026)
- IT & Telecom
- BFSI
- Healthcare and Pharmaceuticals
- Government
- Retail
- Manufacturing
- Energy & Utilities
- Education
- Others
Business Process Outsourcing Regional Outlook (Revenue, USD Million, 2019-2026)
- North America
- US
- Canada
- Mexico
- Western Europe
- UK
- Germany
- France
- Italy
- Spain
- Poland
- Hungary
- Romania
- Rest of Europe
- Central & Eastern Europe
- Asia Pacific
- China
- India
- Japan
- South Korea
- Australia
- Singapore
- Philippines
- Malaysia9
- Indonesia
- Thailand
- Rest of Asia Pacific
- South & Central America
- Brazil
- Argentina
- Rest of South & Central America
- Middle East & Africa
- Saudi Arabia
- South Africa
- United Arab Emirates (UAE)
- Rest of Middle East & Africa
The market intelligence report provides an in-depth analysis of the following –
- Business process outsourcing (BPO) market outlook: analysis as well as historical figures and forecasts of revenue opportunities from the service, enterprise size, vertical, and region segments.
- The competitive landscape: an examination of the positioning of leading players in the BPO market.
- Company snapshots: analysis of the market position of leading service providers in the BPO market.
- Underlying assumptions behind our published base-case forecasts, as well as potential market developments that would alter, either positively or negatively, our base-case outlook.
Scope
This report provides overview and service addressable market for business process outsourcing market.
It identifies the key trends impacting growth of the market over the next 12 to 24 months.
It includes global market forecasts for the BPO industry and analysis of patents, company filings, and hiring trends.
It contains details of M&A and VF deals in the BPO space.
Key Highlights
The global business process outsourcing market size was valued at $329.9 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 2.8% during 2023-2026. The BPO market is driven by the increasing demand for outsourcing various business functions, including human resources, IT services, finance and accounting, customer services, supply chain, market research, data conversion, data entry, marketing, and sales, among others.
Reasons to Buy
This market intelligence report offers a thorough, forward-looking analysis of the global BPO market, service type, enterprise size, verticals, key vendor outlook, and key opportunities in a concise format to help executives build proactive and profitable growth strategies.
Accompanying GlobalData’s Forecast products, the report examines the assumptions and drivers behind ongoing and upcoming trends in BPO markets.
With more than 20 charts and tables, the report is designed for an executive-level audience, boasting presentation quality.
The report provides an easily digestible market assessment for decision-makers built around in-depth information gathered from local market players, which enables executives to quickly get up to speed with the current and emerging trends in BPO markets.
The broad perspective of the report coupled with comprehensive, actionable detail will help BPO players, investors, and other stakeholders succeed in the growing BPO market globally.
Key Players
Accenture PlcAON Plc
Automatic Data Processing Inc
Capita Plc
Concentrix Corp
Conduent Inc
Genpact Ltd
Randstad NV
Serco Inc
Sitel Worldwide Corp
Tata Consultancy Services Ltd
Teleperformance SE
Table of Contents
Table
Figures
Frequently asked questions
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What was the business process outsourcing market size in 2023?
The BPO market size globally will be valued at $339.3 billion in 2023.
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What is the business process outsourcing market growth rate?
The BPO market is expected to grow at a CAGR of 2.8% during the forecast period (2023-2026).
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What are the key business process outsourcing market drivers?
The increasing demand for BPO services across diverse verticals, including healthcare, manufacturing, BFSI, retail, and others, coupled with technological advancements, are anticipated to drive BPO market growth.
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What are the key business process outsourcing (BPO) segments?
Service Segments: Customer Relationship Management, Finance and Accounting, Human Resources, Knowledge Process Outsourcing, Procurement and Supply-Chain, Vertical-Specific BPO
Enterprise Size Segments: Micro (Less than 50), Small (51-250), Medium (251-1000), Large (1001-4999), Very Large (5000+)
Vertical Segments: IT & Telecom, BFSI, Healthcare & Pharmaceuticals, Government, Retail, Manufacturing, Energy & Utilities, Education and Others
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Which are the leading business process outsourcing companies globally?
Some of the leading BPO companies are Accenture Plc, AON Plc, Automatic Data Processing Inc, Capita Plc, Concentrix Corp, Conduent Inc, Genpact Ltd, Randstad NV, Serco Inc, Sitel Worldwide Corp, Tata Consultancy Services Ltd, and Teleperformance SE.
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Is there a third level of segmentation in the report?
GlobalData’s focus is on providing reliable and accurate data that is supported by robust research methodology. Our reports undergo rigorous quality checks and are based on primary and secondary research sources, ensuring that the numbers and insights provided are trustworthy. However, despite the best efforts to gather comprehensive data, there could be instances where the available data is limited, making it challenging to provide third level segmentation. In such cases, GlobalData may choose to provide high-level insights and general trends rather than forcing segmentation that may not be backed by sufficient data. This approach ensures that the report’s overall quality and credibility are maintained.
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