GVR Report cover South Africa Business Process Outsourcing Market Size, Share & Trends Report

South Africa Business Process Outsourcing Market Size, Share & Trends Analysis Report By Service (Customer Services, Finance & Accounting), By End-use (BFSI, IT & Telecommunications), And Segment Forecasts, 2020 - 2027

  • Published Date: Dec, 2020
  • Base Year for Estimate: 2019
  • Report ID: GVR-4-68039-314-2
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 110

Report Overview

The South Africa business process outsourcing market size was valued at USD 1.4 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 13.2% from 2020 to 2027. The market growth is characterized by advances in technology, continued innovation, and intensifying competition, a trend that is expected to continue over the forecast period. The need to control the operating costs, harmonize processes, focus on core competencies, and employ qualified talent is anticipated to drive the market over the coming years. South Africa has been home to many call center operations for the past several years and has hence garnered global recognition as a favorite and trustworthy offshore outsourcing destination.

South Africa business process outsourcing market size, by service, 2016 - 2027 (USD Million)

It also ranks as one of the leading destinations for Global Business Services - or offshoring business processes. Adequate expertise, a large talent pool, lower costs, and easy-to-understand neutral English accents are some of the major factors that are prompting companies to consider South Africa among their preferred outsourcing destinations. With the focus on analytics and Artificial Intelligence (AI)-driven solutions, South Africa has a larger number of actuarial resources as compared to India and can provide support in several languages, including French and Spanish. The use of AI and robotics as a complementary strategy for human resources management can also help the incumbents of the South Africa BPO industry in competing with their competitors in Europe and the Middle East & Africa.

This, in turn, is expected to boost the market growth in the foreseeable future. Furthermore, Business Process Enabling South Africa, the South African BPO industry body, has played a significant role in abetting the industry growth by supporting skill development, sharing best practices, and providing its members with access to other business networks & associations that drive and influence the sector’s transition into the digital economy. In addition, the South African government has introduced several taxation incentives and schemes for the establishment of infrastructure and skills-related support. One of the prominent initiatives is the Monyetla Work Readiness Programme.

The primary focus of this program is to increase the pool of employable entry-level personnel. Through the Monyetla Work Readiness Programme, BPO employers lead a consortia approach to recruit and train entry-level staff. Such initiatives are creating youth employment opportunities and thereby contribute to the region’s export revenues from offshoring services. The BPO industry in SA has been growing continuously, offering new job opportunities, subsequently playing a decisive role in the region’s economic development. Outsourcing service providers believe that South Africa enjoys better opportunities as compared to other countries in Africa to deliver business outsourcing services. Cape Town has particularly emerged as a BPO destination of choice.

Service Insights

The customer service segment dominated the market with a share of over 31% in 2019 and will expand further at the fastest CAGR from 220 to 2027. This growth is attributed to the growing establishment of service centers that necessitate online and offline technical support. Customer service BPOs are dedicated to managing customer queries generated through email, chat, phones, social media platforms, and other channels. The customer service BPO industry is thriving in Cape Town and has risen considerably over the last few years and is expected to witness significant growth in the coming years. Moreover, South Africa holds an advantage when it comes to customer service BPO services. The capability to help companies lower the overall costs coupled with a speedy shift towards remote work operations owing to the Covid-19 pandemic earned South Africa’s customer service centers a superiority over rival hubs.

The finance & accounting segment is expected to grow at a substantial growth rate of 13.6% over the forecast period. The benefit of finance & accounting BPO services in the cost reduction of finance functions is also driving their adoption across several financial institutions in the country. South Africa is steadily advancing in the field of international service delivery to the financial services industry. Several financial organizations are also gradually preferring South Africa for establishing their African back-office shared services hubs as part of their global delivery networks.

End-use Insights

The IT & telecommunication segment dominated the regional market with a share of more than 35% in 2019. The IT and telecommunication sector is one of the leading adopters of BPO services. In the IT space, South Africa has performed a vital role in the field of the service desk and technical helpdesk due to its exceptional voice skills. Moreover, the country consists of a large number of IT graduates who have the pertinent technical skills, which, in turn, reduces the responsibility as well as the cost of training on the part of companies. South Africa continues to remain one of the prominent locations for outsourcing IT services owing to the rapidly growing cluster of companies. These companies provide IT-focused solutions to several industry verticals in the form of website architecture and development, and platform and application development. The rising ICT spending in the country for the regular maintenance of the existing IT and communication systems and replacement of obsolete systems are likely to drive the segment growth.

South Africa business process outsourcing market share, by end-use, 2019 (%)

The BFSI segment is anticipated to register the maximum CAGR during the forecast period. The easy availability of a skilled workforce, including Chartered Financial Analysts (CFAs), Chartered Accountants (CAs), and actuaries, has been the crucial driver of success for the country in this field. Moreover, global banks are choosing South Africa for the delivery of intricate work in banking areas, such as life insurance and fund accounting processes. The country delivers vast volumes of voice processes in the field of insurance, including commission handling, claims processing, and policy administration.

Key Companies & Market Share Insights

The market is highly competitive as most of the major companies are concentrating on improving their market presence by implementing various business strategies, such as partnerships, mergers & acquisitions, and product development. These strategies help organizations expand their business geographically and enhance their offerings across the national and international markets. For instance, in August 2020, WNS (Holdings) Ltd launched EXPIRIUS, a unique customer experience (CX) solution that integrates human-assisted designs with AI-driven conversational insights to improve customer experiences. Some of the major players operating in the South Africa business process outsourcing market include:

  • Accenture Plc

  • Amdocs

  • Capgemini

  • HCL Technologies Ltd.

  • IBM Corp.

  • Infosys Ltd. (Infosys BPM)

  • NCR Corp.

  • Sodexo

  • TTEC Holdings, Inc.

  • Wipro Ltd.

  • Mango5 BPO

  • Indox (PTY) Ltd.

  • Outworx Contact Centre

  • SA Commercial

  • Talksure Group

  • Boomerang Marketing

  • iContactbpo

  • 121 BPO Services

  • Altron

  • The IT Guys

  • Merchants SA (Pty) Ltd.

  • CCI South Africa

  • Capita plc

  • Digicall Group

  • DSG Group

  • Startek

  • WNS (Holdings) Ltd.

  • Webhelp

  • O’Keeffe & Swartz

  • Ignition Group

  • Rewardsco

  • Teleperformance SE

  • Encore Capital Group

  • Pra Group, Inc.

  • Paschoalotto Logo

  • Pioneer Credit

  • Credit Corp Group

  • Collection House Ltd.

South Africa Business Process Outsourcing Market Report Scope

Report Attribute

Details

Market size value in 2020

USD 1.4 billion

Revenue forecast in 2027

USD 3.6 billion

Growth Rate

CAGR of 13.2% from 2020 to 2027

Base year for estimation

2019

Historical data

2016 - 2019

Forecast period

2020 - 2027

Quantitative units

Revenue in USD million/billion and CAGR from 2020 to 2027

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Service, end-use

Key companies profiled

Accenture Plc; Amdocs; Capgemini; HCL Technologies Ltd.; IBM Corp.; Infosys Ltd. (Infosys BPM); NCR Corp.; Sodexo; TTEC Holdings, Inc.; Wipro Ltd.; Mango5 BPO; Indox (PTY) Ltd.; Outworx Contact Centre; SA Commercial; Talksure Group; Boomerang Marketing; iContactbpo; 121 BPO Services; Altron; The IT Guys; Merchants SA (Pty) Ltd.; CCI South Africa; Capita plc; Digicall Group; DSG Group; Startek; WNS (Holdings) Ltd.; Webhelp; O’Keeffe & Swartz; Ignition Group; Rewardsco; Teleperformance SE; Encore Capital Group; PRA GROUP, INC.; Paschoalotto Logo; Pioneer Credit; Credit Corp Group; Collection House Ltd.

Customization scope

Free report customization (equivalent to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

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Segments Covered in the Report

This report forecasts revenue growth at the country levels and provides an analysis of the latest industry trends from 2016 to 2027 in each of the sub-segments. For the purpose of this study, Grand View Research has segmented the South Africa business process outsourcing market report on the basis of service and end-use:

  • Service Outlook (Revenue, USD Million, 2016 - 2027)

    • Finance & Accounting

    • Human Resources

    • Knowledge Process Outsourcing (KPO)

    • Procurement & Supply Chain

    • Customer Services

    • Others

  • End-use Outlook (Revenue, USD Million, 2016 - 2027)

    • Banking, Financial Services, and Insurance (BFSI)

    • Healthcare

    • Manufacturing

    • IT & Telecommunication

    • Retail

    • Others

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