Business Process Outsourcing - Africa

Revenue in the Business Process Outsourcing market is projected to reach US$7.54bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 6.31%, resulting in a market volume of US$10.24bn by 2029.
The average Spend per Employee in the Business Process Outsourcing market is projected to reach US$14.62 in 2024.
In global comparison, most revenue will be generated United States (US$146.30bn in 2024).

Definition :
The Business Process Outsourcing (BPO) market refers to the transfer of entire business processes or individual activities from a company to a third party and is often IT based. BPO covers a wide variety of business processes, usually either in the back office (e.g., human resources) or in the front office (e.g., customer service in call centers). A distinction is made between horizontal and vertical outsourcing. Horizontal BPO combines function-centric as well as cross-sector and cross-industry services, such as human resources management or payroll accounting. Vertical BPO, on the other hand, focuses on specialized services and is especially appealing to customers from the financial services industry, the healthcare sector, the manufacturing industry, or the retail sector.

Additional Information:

The Business Process Outsourcing market comprises revenues, revenue change, average spend per employee, and the market shares of the different business sectors. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include Accenture, Cognizant, Wipro, and IBM.

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Back office process outsourcing, such as Genpact, Concentrix, HCL Technologies, Sutherland Global Services, EXL Services, Remote Coworker, and TechSpeed
Front office process outsourcing, such as IBM Global Services, Hewlett Packard Enterprise (HPE), Sitel Group, Teleperformance, and Qualfon

Application outsourcing, such as ScienceSoft, Arcanys, and SumatoSoft
Administration outsourcing, such as Conduent, Genpact, and ADP (Automatic Data Processing)
Infrastructure outsourcing, such as IBM Global Technology Services, Wipro Infrastructure Engineering, and Cognizant Infrastructure Services

Business Process Outsourcing (BPO) is a rapidly growing industry in Africa, with many countries in the region experiencing significant growth in recent years. The BPO industry in Africa has been expanding at a rapid pace due to a variety of factors, including customer preferences, local special circumstances, and underlying macroeconomic factors.

Customer preferences: One of the main reasons for the growth of the BPO industry in Africa is customer preferences. Many companies are choosing to outsource their business processes to Africa due to the region's highly skilled workforce, which is well-educated and fluent in English. Additionally, many African countries offer lower labor costs than other regions, making it an attractive option for companies looking to reduce their costs.

Trends in the market: The BPO market in Africa is experiencing significant growth in several countries, including South Africa, Kenya, and Nigeria. In South Africa, the BPO industry has been growing rapidly due to the country's highly skilled workforce and favorable business environment. Similarly, Kenya has become a hub for BPO services due to its well-educated workforce and favorable business climate. Nigeria has also seen significant growth in the BPO industry, due in part to the country's large population and growing middle class.

Local special circumstances: Several local special circumstances have contributed to the growth of the BPO industry in Africa. For example, many African countries have government initiatives aimed at promoting the growth of the BPO industry, such as tax incentives and subsidies for companies that establish BPO operations in the region. Additionally, many African countries have invested heavily in telecommunications infrastructure, making it easier for companies to establish BPO operations in the region.

Underlying macroeconomic factors: Several underlying macroeconomic factors have contributed to the growth of the BPO industry in Africa. For example, many African countries have experienced strong economic growth in recent years, which has led to an increase in demand for BPO services. Additionally, many African countries have implemented economic reforms aimed at attracting foreign investment, which has helped to create a favorable business environment for BPO companies. Finally, many African countries have a large and growing middle class, which has created a significant market for BPO services.

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Technology market, in a PDF format.

Unseen yet omnipresent, Information Technology (IT) services are the invisible gears driving modern organizations. These services support business operations and digital transformation through outsourcing, managed services, security, data management, and cloud computing. By leveraging these services, companies enhance efficiency, reduce costs, and gain competitive advantages in a digital marketplace. Prominent cloud providers worldwide include Amazon Web Services, Microsoft Azure, Google Cloud, and Alibaba Cloud. In the managed services sector, Oracle, Accenture, and IBM are among the largest providers globally.