Business Process Outsourcing - South Korea

South Korea

The South Korean Business Process Outsourcing market is anticipated to witness a significant growth in revenue, with projections indicating that it will reach a staggering €8.44bn by the year 2024.
Furthermore, this market is expected to showcase a promising annual growth rate (CAGR 2024-2029) of 4.30%, leading to a substantial market volume of €10.42bn by 2029.
In terms of the average Spend per Employee in the Business Process Outsourcing market, it is estimated to reach €282.10 in 2024.
When compared globally, it is worth mentioning that United States will generate the highest revenue, amounting to €134.30bn in the year 2024.
in South Korea, being a significant player in this market segment, is poised to make a considerable impact on the industry's overall growth and development.
South Korea is emerging as a prominent destination for Business Process Outsourcing in the IT Services market, offering a highly skilled workforce and advanced technological infrastructure.

Key regions: China, Netherlands, Japan, Brazil, Germany

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Analyst Opinion

South Korea, known for its advanced technology and highly skilled workforce, has been experiencing a steady growth in the Business Process Outsourcing (BPO) market.

Customer preferences: South Korean companies have been outsourcing their non-core business processes to BPO companies to focus on their core competencies. This has been a common trend in the BPO market worldwide. Additionally, South Korean companies have been outsourcing to BPO companies in order to reduce costs and increase efficiency.

Trends in the market: One of the trends in the South Korean BPO market is the increasing demand for digital transformation services. With the rise of digitalization, South Korean companies have been seeking BPO companies that can provide services such as robotic process automation, artificial intelligence, and big data analytics. Another trend is the growth of the healthcare BPO market due to the aging population in South Korea. BPO companies have been providing services such as medical billing, medical coding, and medical transcription to healthcare providers in South Korea.

Local special circumstances: One of the local special circumstances in the South Korean BPO market is the government's support for the industry. The government has been providing tax incentives and subsidies to BPO companies to encourage them to invest in South Korea. Additionally, the government has been promoting the country as a destination for BPO services through various marketing campaigns. Another local special circumstance is the high demand for Korean language services. BPO companies that can provide Korean language services have a competitive advantage in the South Korean market.

Underlying macroeconomic factors: One of the underlying macroeconomic factors that is driving the growth of the South Korean BPO market is the country's highly skilled workforce. South Korea has a highly educated workforce with advanced technical skills, which makes it an attractive destination for BPO companies. Additionally, South Korea's advanced technology infrastructure, including high-speed internet and advanced telecommunications systems, makes it easier for BPO companies to provide services remotely. Another macroeconomic factor is South Korea's favorable business environment. The country has a stable political system, strong intellectual property protection laws, and a well-developed legal system, which makes it an attractive destination for foreign investment.

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.