Outsourcing firms aim to provide SMEs and global giants with access to deep labor pools in developing countries. The aim is to help companies lower operational costs while maintaining high levels of customer service, supporting companies as they grow.
Outsourcing has never been more popular among businesses, especially as the pandemic forced many businesses to reduce costs and close their offices. Deciding to outsource business processes pays immediate dividends and enables companies to grow faster by immediately improving their bottom line.
More and more companies understand the potential inherent in outsourcing. Data from Google indicates searches for “bpo companies” globally has risen 50% year on year (as of May 2022).
However, notwithstanding the increased levels of demand for their services, the likes of Infosys Limited (INFY), Concentrix Corporation (CNXC), and Teleperformance (TLPFF) have collectively taken a battering over the last 6 months. Although comprising a huge proportion of the global outsourcing market, investors have dumped their shares in droves.
Newer outsourcing firms with a focus on remote first have risen from the ether. An interesting case study is BruntWork, which has focused on helping companies hire internationally by placing remote workers from developing countries.
BruntWork makes it easy for workers to access great opportunities in global firms from the comfort of home.
The big question for analysts is whether the new breed of remote-first outsourcing firms like BruntWork can conquer the outsourcing space and steal significant market share from their incumbents?
Infosys (INFY), Concentrix Corporation (CNXC), and Teleperformance (TLPFF) are trading at less than two times their projected sales for 2022. That’s pretty cheap for firms in this industry and might make them worth a closer look for investors looking for opportunities.
And while it’s a tall order for any new entrant to conquer any sector that they’re in, especially one that’s still finding its feet like BruntWork, early signs look encouraging. BruntWork recording over 700% revenue growth through the pandemic, eclipsing their more mature and established competitors.