IT Outsourcing - Mongolia

Mongolia

The IT Outsourcing market in Mongolia is anticipated to witness significant growth in the coming years.
According to projections, the revenue is expected to reach US$43.18m by 2024.
Furthermore, a promising annual growth rate of 8.33% (CAGR 2024-2029) is expected, which will result in a market volume of US$64.43m by 2029.
When it comes to the average Spend per Employee in the IT Outsourcing market, it is estimated to reach US$30.98 in 2024.
This indicates a considerable investment in the sector, indicative of its potential for growth and development.
In terms of global comparison, United States is projected to generate the highest revenue in the IT Outsourcing market, with a staggering US$197.30bn in 2024.
This showcases the dominance of the United States in this industry and its position as a major player on the global stage.
Mongolia is emerging as a competitive player in the IT outsourcing market, offering cost-effective solutions and a skilled workforce.

Key regions: Brazil, Italy, United States, China, Germany

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. 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 IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

Region comparison

Currency

Analyst Opinion

Mongolia, a country located in East Asia, has been experiencing a growth in its IT outsourcing market in recent years.

Customer preferences: Mongolian businesses have been increasingly turning to IT outsourcing to reduce costs and improve efficiency. Many companies have found that outsourcing IT services allows them to focus on their core competencies and free up resources for other areas of their business. Additionally, there is a growing demand for IT services in Mongolia due to the country's expanding economy and the increasing importance of technology in business operations.

Trends in the market: One trend that has emerged in the Mongolian IT outsourcing market is the rise of cloud computing services. Many companies are now using cloud-based solutions for data storage and management, which has led to an increase in demand for cloud-based IT services. Another trend is the growing popularity of mobile applications, which has led to an increase in demand for mobile app development services.

Local special circumstances: Mongolia's IT outsourcing market is still in its early stages, and as such, there are some unique challenges that companies may face. For example, there is a shortage of skilled IT professionals in the country, which can make it difficult for companies to find the talent they need. Additionally, there are some cultural and language barriers that companies may need to navigate when working with Mongolian IT outsourcing providers.

Underlying macroeconomic factors: One factor that is driving the growth of Mongolia's IT outsourcing market is the country's expanding economy. As Mongolia's economy continues to grow, more businesses are looking for ways to improve their operations and stay competitive. Additionally, the government of Mongolia has been making efforts to promote the country as a destination for IT outsourcing, which has helped to attract more foreign investment in the sector.

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.