A growing market
Independent analysts have estimated that the total market for BPO in the UK in 2009 was £6bn, against market potential of £94.2bn a year.* The capacity for long term growth therefore remains substantial as organisations review their business models and acknowledge the benefits of outsourcing.
We remain the clear leader in the overall UK BPO market, with 27.0% market share (2008: 25.5%).*
In 2009 we gained business across both the public and private sectors. As a result, the sector split of revenues remained broadly in balance at 50% private/50% public (2008: 52%/48%).
Our most active market in 2009 was local government. We also saw increased activity in financial services and central government and ongoing interest from the life and pensions market. All these markets are expected to offer a further steady flow of opportunities.
Competitive advantage
Our scale, flexible infrastructure and expertise position us well in our 9 chosen markets. Our clients benefit from reduced costs, improved business processes and better services to offer their own customers. Our reputation allows us to compete strongly in our marketplace.
Increasingly, clients are also seeking outsourcing partners with the financial stability to deliver a complex range of services under a long term contract. Capita meets all these requirements and our clients have the benefit of working with one partner responsible for a spectrum of services rather than having to manage multiple service providers.
The long term contracts we secure, and our high contract renewal rate, evidence the strength of our partnerships and our clients’ satisfaction; in turn, this helps us secure further business.
Our focus on the UK and Ireland has allowed us to develop a detailed understanding of our chosen markets and the key drivers for outsourcing in each sector. This market knowledge gives us further competitive advantage.
9 diverse and growing markets
We currently operate in 9 distinct markets across the public and private sectors where the drivers for outsourcing are strong. We are number one in most of our markets. We remain focused on selecting opportunities where we believe we can clearly meet clients’ expectations and add value, fuelling controlled growth and achieving a reasonable return for the Group.
We provide outsourcing and support services to both local authorities and central
government. We have built – particular expertise in education, transport and health
and have a growing interest in defence.
We expect fiscal pressure on public spending to heighten the focus on outsourcing
in the public sector in 2010. Irrespective of which party wins the UK General Election,
further cost efficiencies will need to be achieved without compromising the availability
or quality of frontline public services.
A combination of reduced revenues and increased demand for services is likely to
add pressure on budgets both locally and centrally. With our solid track record
of delivering public sector contracts, we are well placed to help organisations
to introduce new, more sustainable and streamlined ways of working to meet public
needs.
The 3 main private sector markets we focus on are life and pensions, insurance, and financial services. We also support an increasing number of organisations in other markets and we have a growing interest in the banking and utilities sectors.
In the current economic climate there is increased pressure on commercial organisations to drive down operational costs without compromising customer service or their competitiveness in their marketplace. As they strive to do this, and to bring new products to market faster, we expect them to consider the higher productivity and enhanced operational and advisory capabilities that an experienced outsourcing service provider can bring them.
We remain encouraged by the level of opportunities across our chosen markets. With our scale, expertise and financial stability, we believe we are strongly placed to help existing and potential clients create more flexible, lower cost operating models while improving service quality.