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Impact of COVID-19 on Business Process Outsourcing Market

Competition in various industries across the globe concerning cost has increased exponentially. Asia Pacific with its cheap labor and operational cost has disrupted many industries such as semiconductors and chemicals. Business process outsourcing enables transfer of front office as well as back office work to a third-party company to eliminate the extra in-house cost. The overall cost to company can be reduced and companies can prioritize the business significantly. The overall benefits at the macro level is driving the growth of business process outsourcing..

Access to Specialized Resources and Skills

One of the major driving factors of business process outsourcing is it empowers a company to gain specialized expertise in its non-major business segments. This enables the company to gain access to more opportunities through specialization and also helps it to focus on primary objectives as well as prioritize work more efficiently.

Low Adoption among SMEs

Business process outsourcing increases the fixed cost in terms of what business enterprises need to pay to the outsourcing partner. A fixed monthly/quarterly/annual payment has to be made even in the event of no usage of the service. Hence, small & medium enterprises resist from adopting business process outsourcing due to increase in the fixed cost as well as total cost.

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North America to Dominate the Global Business Process Outsourcing Market

In terms of region, the global business process outsourcing market can be divided into North America, Europe, Asia Pacific, South America, and Middle East & Africa. North America is expected to dominate the business process outsourcing market during the forecast period due to strong adoption rate of outsourcing or rental models by business enterprises.

COVID-19 Impact on the Global Business Process Outsourcing Market

The COVID-19 pandemic is expected to moderately impact the global business process outsourcing market for a short-term period. The economic depression due to lockdown and shut down of enterprises across the globe has led to low investment in outsourcing activities as this increases the additional fixed cost of companies.

Global Business Process Outsourcing Market – Dynamics

Cost Competition

Competition in various industries across the globe concerning cost has increased exponentially. Asia Pacific with its cheap labor and operational cost has disrupted many industries such as semiconductors and chemicals. Business process outsourcing enables transfer of front office as well as back office work to a third-party company to eliminate the extra in-house cost. The overall cost to company can be reduced and companies can prioritize the business significantly. The overall benefits at the macro level is driving the growth of business process outsourcing..

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Access to Specialized Resources and Skills

One of the major driving factors of business process outsourcing is it empowers a company to gain specialized expertise in its non-major business segments. This enables the company to gain access to more opportunities through specialization and also helps it to focus on primary objectives as well as prioritize work more efficiently.

Low Adoption among SMEs

Business process outsourcing increases the fixed cost in terms of what business enterprises need to pay to the outsourcing partner. A fixed monthly/quarterly/annual payment has to be made even in the event of no usage of the service. Hence, small & medium enterprises resist from adopting business process outsourcing due to increase in the fixed cost as well as total cost.

North America to Dominate the Global Business Process Outsourcing Market

In terms of region, the global business process outsourcing market can be divided into North America, Europe, Asia Pacific, South America, and Middle East & Africa. North America is expected to dominate the business process outsourcing market during the forecast period due to strong adoption rate of outsourcing or rental models by business enterprises.

COVID-19 Impact on the Global Business Process Outsourcing Market

The COVID-19 pandemic is expected to moderately impact the global business process outsourcing market for a short-term period. The economic depression due to lockdown and shut down of enterprises across the globe has led to low investment in outsourcing activities as this increases the additional fixed cost of companies.