BPO Sector in Romania and Emerging Europe H1 2021
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BPO Sector in Romania and Emerging Europe H1 2021 A DEMO Sector Overview by FRD Center
Transcript of BPO Sector in Romania and Emerging Europe H1 2021
BPO Sector in Romania and Emerging Europe
H1 2021
A DEMO Sector Overview by FRD Center
This DEMO report is produced by FRD Center –
www.frdcenter.ro - one of the pioneer privately
owned independent market entry consulting firms in
Emerging Europe as a promotional document.
Since 2000, FRD Center offers upon demand new
suppliers identification and selection services, market
research and intelligence, B2B matchmaking and
M&A consulting services to foreign companies and
organisations interested to enter Romania and the
emerging markets in Europe as manufacturers,
exporters, consultants, investors or joint-ventures, to
relocate their operations, or to source in CE, SE and
Eastern Europe.
Disclaimer:
Whilst every care is taken in compiling this
report, no responsibility is taken for errors or
omissions. FRD Center guarantees that this
information, collected and generated, has
been operated in a professional manner and
best efforts were applied with a view to
offering accurate and complete results.
However, FRD Center will not be held liable for
any damage or loss resulting from the use of
the information contained herein.
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
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In this Sector Overview
1. Why Romania?2. Why BPO in Romania?3. Analysis of the Romanian BPO market
Competitive analysis of some main players on the Romanian BPO and SSC market
4. Developments on the Romanian BPO and SSC market - M&A of local players5. COVID19 pandemic and the BPO sector in Romania6. Expected evolution of the Romanian BPO sector7. Brief analysis of the the BPO sector in Emerging Europe: Poland, Czechia,
Ukraine, Hungary, Bulgaria, Lithuania etc.
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
About FRD Center
Services include:
Multi-country market research
New suppliers identification and selection
Players identification and detailed profiles
Comparative analysis
Data collection, interviews with KOLs
Reputation checks
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promocion exterior, Instituto de Fomento Region
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One of the pioneer privately owned independent market entry consulting firms in Emerging Europe
Covers markets such as Romania, Bulgaria, Poland, Hungary, Czechia, Serbia, Lithuania, Turkey etc.
Provides assistance to:
- Foreign companies, SMEs, corporations
- Foreign export promotion agencies, international trade organisations, global consulting groups, chambers of commerce, commercial sections of embassies
1. Why Romania?
Romania is the 2nd largest market in Central Eastern Europe after Poland and one of the most dynamic economies in the EU.
With a real GDP growth of 4.2% in 2019 and expected similar y-t-y growth of the economy in 2021 and 2022, Romania is on investors’ agenda.
Some of the country’s strengths are: strong democracy, stable political and banking systems, one of the fastest Internet speeds in the world, educated English speaking population.
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
2. Why BPO in Romania?
Romania is one of the most preferred near-shore locations, capitalizing on the solid education system, with a strong focus on IT, finance and accounting and, therefore, providing a steady, relatively inexpensive and qualitative flow of skilled resources to meet the growing demand of SSC / BPO entities. More than 120,000 university graduates per year form the talent pool in Romania.
Cultural compatibility and a large scale of foreign language skills, covering English, French, Spanish, Italian, German, Dutch, Portuguese, Hungarian, Czech, Slovak, Bulgarian and Russian, provide a competitive edge to the Romanian work force.
FRD Center has been assisting foreign companies looking for BPO market expansion and acquisitions in the business process outsourcing sector and has been closely monitoring the activity in the Romanian BPO sector.
Here are some facts on Romania that might be of interest to a foreign investor or BPO provider looking to acquire a local player and set up operations in Romania, thus accessing the EU market and other key markets overseas.
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2. Why BPO in Romania?
The Romanian outsourcing market consolidated its position as one of the leading outsourcing sectors in Europe.
The Romanian BPO market includes approximately 280 companies that activate in the business services sector, with over 131,000 employees.
According to the Association of Business Service Leaders in Romania (ABSL), the revenues generated by the business services industry in Romania are estimated at 4.5 billion EUR in 2020.
The business services industry contributes with around 2 - 2.5% to the GDP in Romania. The attrition rate in the business services sector in Romania was 12% by July 2020, with an average of 22% in the past three years.
The main cities for the business services industry in Romania are Bucharest, Timisoara, Cluj Napoca, Iasi, Brasov and Sibiu.
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2. Why BPO in Romania?
The outsourcing sector in Romania is characterised by:- strong IT infrastructure- growing level of automation- relatively good availability of qualified resources- very good language proficiency of both Latin and Germanic tongues- competitive labour costs
For more details visit the FRD Center presentation available at this link:http://www.frdcenter.ro/assets/BPO-Sector-Romania-FRD-Center-analysis.pdf
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Photo: Competence Call Center
FRD Center is monitoring the players and market opportunities in the Business
Process Outsourcing (BPO) sector in Romania and other markets in CE Europe,
Eastern Europe and SE Europe.
Upon demand, FRD Center identifies and selects the local players according to
the Client’s criteria, provides In-Depth Analysis and Traget Origination services.
For 20 years, FRD Center facilitates commercial relations between foreign
manufacturers, investors, exporters with local key decision makers and
provides B2B matchmaking at Decision Maker level, Market Research etc.
Email: [email protected]
with your specific demand for local support
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Photo: Competence Call Center
Most employees with long-term contracts in the business services sector in Romania provide:- Customer service: 29%- IT and software development: 28%- Financial services: 19%- HR: 10%- Supply chain management: 6%- Banking and insurance: 1%
The monthly salary in the BPO sector in Romania varies based on the position and the level of seniority. Furthermore, some companies offer language bonuses, annual performance bonuses and extra holiday days. The main non-financial benefits offered to employees are: meal tickets, private healthcare and flexible hours.The clients of the domestic business services providers are mainly located in Western Europe and CEE, including Romania. Furthermore, the domestic business services providers have clients located in North America, South America, Middle East, Africa and Asia Pacific.
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3. Analysis of the Romanian BPO market
Photo: Open Mind Group
Some of the main players on the Romanian BPO and SSC market, as they have been identified by FRD Center include:
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BPO:GenpactAccentureComputer Generated Solutions (CGS)WiproSykesComdataWebhelpWNSArvatoConcentrixTelus / Competence Call CenterTeleperformance
SSC:OracleMicrosoftIBMHPOrangeVodafoneOMV PetromBRDP&GEmersonBosch
3. Analysis of the Romanian BPO market
3. Analysis of the Romanian BPO market
Based on specific request from foreign Clients looking to expand on the Romanian BPO market, FRD Center generates in-depth competitive analysis of local players and specific work conditions, such as salaries, attrition rates etc.
Here are some examples of gross annual salaries:- a junior employee in finance / accounting starts at 7,700 EUR per year, - a junior employee in customer service starts at 6,800 EUR/year- a junior employee in IT starts at 10,800 EUR/year.
In regards to gross wages in the BPO sector in Romania, these can vary depending on experience and skills. These can vary between 13,000 EUR and 66,000 EUR/year.
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
Photo: Pexels
3. Analysis of the Romanian BPO marketCompetitive analysis of six main players
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Net turnover 2017
million EUR
2018
million EUR
2019
million EUR
Genpact Romania SRL 97.6 96.6 111.6
Accenture Services SRL 60.9 70.6 90.8
Computer Generated Solutions Romania SRL 52.6 52.8 58.8
Wipro Technologies SRL 35.6 40.2 44.0
Sykes Enterprises Eastern Europe SRL 25.3 29.7 30.9
Comdata Service SRL 34.6 34.6 25.9
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40
80
120
mill
ion
EU
R
2017 2018 2019
Net turnover dynamics of six BPO service providers in Romania
Genpact Romania Accenture Services
Computer Generated Solutions Romania Wipro Technologies
Sykes Enterprises Eastern Europe Comdata ServiceSource: FRD Center, Ministry of Public Finances
For in-depth analysis of the BPO players and call-centers in Romania and other markets in
Eastern Europe, as well as for target origination and M&A assistance, contact the
FRD Center team at email: [email protected]
3. Analysis of the Romanian BPO marketCompetitive analysis of six main players
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
Source: FRD Center, Ministry of Public Finances
0
4
8
12
mill
ion
EU
R
2017 2018 2019
Net profit dynamics of six BPO service providers in Romania
Genpact Romania Accenture Services
Computer Generated Solutions Romania Wipro Technologies
Sykes Enterprises Eastern Europe Comdata Service
0
1,000
2,000
3,000
4,000
2017 2018 2019
Average number of employees of six BPO service providers in Romania
Genpact Romania Accenture Services
Computer Generated Solutions Romania Wipro Technologies
Sykes Enterprises Eastern Europe Comdata Service
4. Developments on the Romanian BPO market - M&A of local players
The Romanian BPO sector continues to attract numerous foreign investment, both greenfield and crossborder M&A. Here are some recent examples:
In January 2021, Wipro agreed to take over IT units from the German retailer Metro, namely Metronom Germany and Metro Systems Romania, in a transaction estimated at 700 million USD. Set up in 2004, Metro Systems Romania has 850 employees.
The global BPO player Telus International confirmed in February 2020 the close of the previously announced acquisition of Competence Call Center (CCC). Telus International now holds a 100% interest in CCC. Both companies are also present in Romania.
Telus International entered the domestic market in 2012 through the acquisition of CallPoint New Europe, a successful regional BPO provider with operations in the CEE region, including Romania.
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4. Developments on the Romanian BPO and SSC market
~examples~
For 2021, CGS Romania forecasts a similar increase in its number of employees as in 2020.
CGS opened at the end of 2019 its seventh centre on the local market.
Located in Constanta, SE Romania, it serves projects in the financial, technical, sales and customer service areas.
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
Photo: CGS
Computer Generated Solutions (CGS) maintained in 2020 its recruitment pace in Romania despite the pandemic. The BPO player increased its team in Romania with 500 new employees in 2020. CGS signed contracts with new clients or extended projects with the existing ones in 2020, which translated into a significant employment volume. The company invested in a remote network for the entire company to allow its employees to work safely from home.
4. Developments on the Romanian BPO and SSC market
~examples~
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
Wipro leased 11,000 sqm of office space in Globalworth Square, a new office project in northern Bucharest, expected to be finalised in T2 2021.
Teleperformance Romania plans to hire 400 - 500 persons who speak foreign languages in 2021.
Accenture will continue in 2021 the educational programmes in the IT field, developed and implemented in 2020 for pupils and students across Romania.
According to the FRD Center analysis, some of the most active BPO players operating on the Romanian market are Genpact Romania, Accenture Services, Computer Generated Solutions Romania, Wipro Technologies, Sykes Enterprises Eastern Europe and ComdataService.
For in-depth analysis of the BPO players and call-centers in Romania and other markets in Eastern Europe, as well as for target origination and M&A assistance,
contact the FRD Center team at email: [email protected]
5. COVID19 pandemic and the BPO sector in Romania
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
The year 2020 brought unprecedented challenges, the economic conditions completely shifted the expected trends and the Romanian BPO sector had to adapt to the COVID-19 crisis.
The sector was well prepared for the remote work as the outsourcing is based on the concept of working from a distance.
The pressure put on costs due to the COVID-19 pandemic determined companies globally to rethink their cost structure and rebuild their outsourcing strategies and Romania is in the top of relocation options.
Photo: Agro Business
5. COVID19 pandemic and the BPO sector in Romania
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According to an ABSL survey, in mid-March 2020, 98% of the companies in the business services industry in Romania choose the working from home option in order to protect their employees and to ensure the business continuity.
48% of companies that responded to ABSL study will consider a hybrid work system in 2021, 13% of them will continue in the telework system, while 39% of companies believe that in the medium term exclusive telework is not a viable alternative.
Although the BPO players in Romania adapted to the new situation, their customers all around the world were affected by the COVID-19 crisis and a lot of projects were put on hold or canceled.
Out of the 59 business services companies in Romania which participated at an ABSL survey in 2020, 72% declared a decrease in external or internal demand, due to the global economic crisis.
Another important impact of the pandemic is the increase in employees’ retention rate over the past year. The average rate of leavings from companies was 22% for the period 2017 – 2019 and decreased to only 12% between January and July 2020, according to the annual ABSL study.
6. Expected evolution of the Romanian BPO sector
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According to ABSL, the Romanian business services industry is expected to record a growth of 5 - 10% in the medium term.
Out of the 59 business services companies in Romania which participated at an ABSL survey in 2020, 53% of the respondents forecast to record similar business level as before COVID-19 pandemic by mid 2021, while 37% are reserved to estimate the timeline.
The current context is favorable for Romania and the business services industry. Globally, companies are rethinking their cost structure and rebuilding their outsourcing strategies, Romania being in the top of relocation options.
Photo: Comdata Group
7. Brief analysis of the the BPO sector in Emerging Europe
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Central Eastern Europe, South Eastern Europe and Eastern European countries are globally recognised as strong players in business processes and IT services outsourcing.
Numerous multinational companies operating in these sectors choose to expand to the region through the acquisition of local BPO firms.
One such example is the FRD Center project briefly described at the link:
https://www.frdcenter.ro/portfolio/case-study-three-market-expansion-support-in-bpo-sector/
7. Brief analysis of the the BPO sector in Emerging Europe
Poland
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There are over 1,500 BPO, SSC /GBS, IT and R&D business services centres in Poland, out of which 66% are owned by foreign investors. 95 Fortune Global 500 investors have business services centres in Poland.
The value of exports of business services in 2019 from Poland recorded 19.8 billion USD. The share of the business services sector in the GDP in Poland is 3 - 3.5% and growing.
The total number of jobs at business services centres in Poland reached 338,000 in Q1 2020, accelerating at a compound annual growth rate of 12.1% during 2016 - 2020. The number is expected to reach 363,000 in Q1 2021.
Picture: ITSG Global
7. Brief analysis of the the BPO sector in Emerging Europe
Czechia
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The total number of employees in the business services sector in Czechia was of 120,000 in 2020 and is expected to grow to 130,000 in 2021.
The employment growth was of 5% in 2020, proving the sector adaptability, flexibility and resilience during the pandemic crisis. The employment growth is expected to be of 5% in 2021.
Currently there are 330 business services centres in Czechia.
The business services centres in Czechia are increasingly becoming hubs of innovation and excellence, 73% of all processes being delivered in the advanced or partner stage in 2020, compared to 68% in 2018.
The top most advanced services delivered by the business services centres in Czechia are:
• Cyber security and information security• Application lifecycle management /
bespoke, gradual and software development
• Customer operations: fulfilment• Project management office• Insurance specific processes: claim
processing, policy administration, underwriting, regulatory reporting
7. Brief analysis of the the BPO sector in Emerging Europe
Ukraine
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In spite of being affected by the vicininty with a conflict zone, Ukraine is known as a preferred destination for business service centers, especially for IT outsourcing in Eastern Europe.
Some of its competitive advantages include:- low operating costs - large skilled labor force of more than 14 million people - advanced level of education - favorable tax regime, especially for the IT sector
It is estimated that 185,000 people are employed in the BPO and outsourcing industry in Ukraine, with an expected growth up to 220,000 by 2022.
The greatest majority are employed in the IT helpdesk (37%) and software development (32%) business areas.
Photo: Pexels
7. Brief analysis of the the BPO sector in Emerging Europe
Hungary
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Hungary is one of the leading international hubs for business services in CEE, due to highly educated workforce, investor friendly business environment and developed infrastructure.
There were 131 business services centres in Hungary in 2020 employing 63,892 people.
They have the following operational model:- 54% captive- 27% hybrid- 19% BPO
Unlike other countries in the region which are focused on IT, Hungarian centers mainly deliver finance and accounting (80%) and HR (40%) processes.
Some of the business processes outsourcing companies operating in Hungary include:
- Accenture Kft.- Agoda International Kft.- Avaya- BDO Hungary- Celero Hungary- CloudAgents Zrt.- Colognizant Technology- CPL Integrated Services- Elerton Call Centers Kft.- Enterprise Services Hungary- EPAM System Kft- Pactera Technology Kft- Safeguard World Hungary- TMF Group- Transcom Hungary
7. Brief analysis of the the BPO sector in Emerging Europe
- competitive analysis example -
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
0
10,000
20,000
30,000
40,000
EUR
Bulgaria Czechia Hungary Lithuania Poland Romania Serbia Ukraine
Competitive analysis: max annual
salary for IT helpdesk specialist in BPO sector
Source: ABSL EMEA's Business Services Landscape
FRD Center assists international companies with overseas expansion, market research, targets origination and market entry to the Emerging Markets in Eastern Europe, CE and SE Europe.Are you a foreign company looking to expand, acquire local players, build strategic partnerships or to find new Clients in Eastern Europe?
As one of the pioneer privately owned market entry advisory firms in Romania, operating for 20 years, FRD Center has high competencies in market entry advisory and is quite well placed to assist foreign companies with a multitude of aspects related to new vendor identification & selection, market opportunity assessment, B2B matchmaking with local Decision Makers and M&A in Romania and the region.
This is a DEMO market analysis. For B2B matchmaking according to your specific needs, contact the FRD Center team at
Jackie BOJOR, Director
FRD Center
Str. Orzari 5, Bl 46bis
Bucharest, Romania
www.frdcenter.ro
Tel: +4021 411 1460; +4021 411 1461
Skype: FRDCenter
e-mail: [email protected]
For tailored Market Research, B2B Matchmaking with local
players in the sector, New Suppliers Identification, Target
Origination and M&A assistance feel free to contact
This is a DEMO market analysis. For market entry according to your specific needs, contact the FRD Center team at
