Outsourcing in UK retail more than doubles

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E-commerce and mobile help drive digital transformation strategies of retailers

Outsourcing activity in the retail sector surged in the first quarter of 2016 as retailers invested in their multi-channel capabilities, according to research.

The research found that outsourcing spend in the sector more than doubled year-on-year to £155.3 million in Q1 2016, with analysis of the deals revealing that delivering an improved multi-channel shopping experience was a driver behind 60 percent of agreements.

The research – the arvato UK Outsourcing Index – is compiled by business process outsourcing (BPO) provider arvato in partnership with industry analyst NelsonHall.

e-commerce shopping trolleyThe data shows that the retail surge is part of a longer term trend, following a 45 percent increase in retail outsourcing during 2015 – rising to £378 million for the year. And the growth is linked to consumer behaviour.

According to UK online retail industry association, IMRG, e-commerce spending in the UK is expected to grow by 11 percent in 2016, reaching £126 billion, with over a third (34 percent) of consumers saying mobile will become their main shopping channel this year.

Debra Maxwell, CEO, CRM and public sector, UK and Ireland, arvato, said: “UK retailers are keen to reach customers through a broad range of channels. However, delivering a seamless, multi-channel shopping experience requires major transformation.

Our research shows that retailers are increasingly looking to outsourcing partners to access the technology and expertise they need to get ahead in a rapidly growing market.”

The Index research is based on an analysis of all outsourcing contracts secured in the UK market during the first quarter of 2016.

Earlier this week, it was announced that outsourcer Sopra Steria had signed a major “digital first” e-commerce transformation deal with UK fashion group N Brown.

@AntonySavvas