InfoTrends/CAP Ventures’ new forecast entitled Canadian Document Outsourcing Market Forecast: 2003-2009 provides an in-depth look at the Canadian document outsourcing market as it exists today and the analysis necessary to understand where it is headed through 2009. The forecast discusses the actual revenues across three primary segments for 2003 and 2004: Facilities Management (FM), Statement Printing (SP), and Contracted Print (CP) Services. The report also examines a new segment, Document Process Outsourcing (DPO).
According to the forecast, the Canadian document outsourcing market is currently valued at CDN$4.9 billion and is expected to reach CDN$6 billion by 2009, representing a steady compound annual growth rate (CAGR) of nearly 4%.
Figure 1: Canadian Document Outsourcing Forecast by Environment (CDN$Millions)
DPO, the assignment of an entire document-related business process to an external service provider, currently accounts for only a small portion of the overall market. However, DPO represents the highest growth potential, with market share expected to reach 15% by 2009, accounting for CDN$1.9 billion.
Outlook: Canada versus Other Geographies
InfoTrends/CAP Ventures projects that the Canadian document outsourcing market will continue to grow; however, slow economic growth, transitions in the service provider market, and a focus on reducing costs are all factors making it difficult for the market to grow as rapidly as originally expected.
Compared to other geographies, document outsourcing in Canadais only growing slightly faster overall than the United States, but it trails behind Western Europe. The close ties between the Canadian and U.S. markets are mostly influenced by Canadian companies with operations in the U.S. and vice versa.
When compared with the Canadian market, Western Europe remains a higher growth region for document outsourcing. Europe has begun aggressively embracing outsourcing practices that are traditionally more established in the U.S. and Canada, and has gained new growth as a result. In addition, more Euro-centric business models within outsourcing have emerged throughout the region that provide economic benefits beyond the traditional labor costs that have marked a majority of the value created within outsourcing in the U.S. and Canada.
Value Added Service Trends
Document outsourcing providers have offered a number of unique services, with content management and personalization/customization services both representing relatively high-margin opportunities. In the FM segment alone, InfoTrends/CAP Ventures expects content management services within Canada to increase from CDN$1.6 million in 2004 to CDN$2.8 million in 2009, representing a CAGR of 12.0%.
The management of documents and content can be a lucrative area, but some customers expect service providers to do more than manage what they have. Service providers are also expected to help customers create and enhance content. Significant opportunities exist in the creation of multi-channel variable data document design (which we identify in the survey as personalization or mass customization), and in adding color.
Customers seeking a degree of personalization within documents continue to view the task as conceptually simple, yet difficult for vendors to implement in that they are dependent upon service providers for guidance and expertise. Effective providers will not only arrange for necessary IT resources, but will also develop strategies that maximize the effectiveness of the document in attracting sales and suggesting approaches in incorporating text, graphics, layout variation, and messaging. Service providers who have all the necessary components of a variable data solution, including software tools, process know-how, list management, and marketing communications skills, are best positioned to offer and profit from these services.
The preceding is an excerpt from InfoTrends/CAP Ventures’ forecast “Canadian Document Outsourcing Market Forecast: 2003-2009”. The complete document is available immediately. To learn more about the report or to make a purchase, visit our online store or contact Alison Hipp at , ext. 126 or .
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