Manufacturers boost outsourcing spending

The total volume of deals in the manufacturing sector was also up, rising by 50%, along with first time outsourcing, which increased from 33% in the first half of 2013 to 66% between January and June of this year. The data was compiled by business process outsourcing (BPO) provider arvato in partnership with industry analyst NelsonHall. arvato said the increase in outsourcing activity was driven by broader growth in the manufacturing sector. Figures from the British Chamber of Commerce released in July, based on a survey of almost 7,000 companies in the manufacturing and services sectors, found that 42% of manufacturers reported a rise in domestic sales in Q2 2014. Debra Maxwell, managing director of arvato UK, said: "While not seen as a traditional market for business process and IT outsourcing, manufacturers under increasing growth pressure are turning to outsourcers to help support non-core functions, allowing them to focus on their expansion strategies and product innovation. The flexibility and efficiency savings outsourcing provides is the ideal tonic for their growing pains." BPO deals were most in demand, accounting for over half (52%) of all agreements, the survey found. HR outsourcing – which includes services such as payroll, benefits administration and recruitment process outsourcing – was the dominant service line.