Business Process Outsourcing - Latvia

Latvia

Revenue in the Business Process Outsourcing market is projected to reach US$80.03m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 5.92%, resulting in a market volume of US$106.70m by 2029.
The average Spend per Employee in the Business Process Outsourcing market is projected to reach US$81.55 in 2024.
In global comparison, most revenue will be generated in the United States (US$146.30bn in 2024).

Key regions: United Kingdom, United States, Brazil, Japan, Netherlands

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Analyst Opinion

The Business Process Outsourcing (BPO) market in Latvia has been steadily growing in recent years, driven by a combination of customer preferences, local special circumstances, and underlying macroeconomic factors.

Customer preferences: Latvia has become an attractive destination for BPO services due to its highly skilled and multilingual workforce. Many companies are looking to outsource their business processes to take advantage of the cost savings and efficiency gains that come with working with a third-party provider. Additionally, Latvian BPO providers are known for their high-quality services and customer-centric approach, which has helped to build a strong reputation for the country in this industry.

Trends in the market: One of the key trends in the Latvian BPO market is the increasing demand for IT-related services. As more companies look to digitize their operations and adopt new technologies, there is a growing need for BPO providers that can offer expertise in areas such as software development, data analytics, and cybersecurity. Additionally, there is a trend towards more specialized BPO services, with providers focusing on specific niches such as finance and accounting, human resources, or customer service.

Local special circumstances: Latvia's location and infrastructure also make it an appealing destination for BPO services. The country is well-connected to the rest of Europe and has a modern telecommunications infrastructure that allows for seamless communication with clients overseas. Additionally, the Latvian government has been supportive of the BPO industry, offering incentives and tax breaks to companies that choose to set up operations in the country.

Underlying macroeconomic factors: Latvia's strong economic growth and stable political environment have also contributed to the growth of the BPO market. The country has a highly educated workforce and a low cost of living, which makes it an attractive destination for companies looking to outsource their business processes. Additionally, Latvia's membership in the European Union has helped to create a favorable business environment, with access to a large market and a stable regulatory framework.In conclusion, the BPO market in Latvia is poised for continued growth in the coming years. With a highly skilled workforce, modern infrastructure, and favorable business environment, the country is well-positioned to attract more companies looking to outsource their business processes. As the trend towards digitalization and specialization continues, we can expect to see more demand for IT-related and niche BPO services in Latvia.

Methodology

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.