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United States Document Outsourcing Market Overview and Outlook

Introduction

InfoTrends/CAP Ventures’ Forecast entitled U.S. Document Outsourcing Market Forecast: 2004-2009 provides an overview of the document outsourcing market as it exists today and the analysis and insight needed to understand the direction of this market in the future. This report outlines the actual and forecasted revenues across four segments (on-site contracted services, statement printing, off-site contracted services, and document process outsourcing) and covers the period between 2004 and 2009.

Market Outlook and Overview

InfoTrends/CAP Ventures projects that the U.S. document outsourcing market will continue to grow at a slow but steady pace. Between 2004 and 2009, this market is expected to experience a compound annual growth rate (CAGR) of 4.0%, reaching $38.3 billion by 2009. Opportunities for higher growth rates exist within value-added services concerning digital color production printing and document process outsourcing.

Figure 1: United States Document Outsourcing Market Forecast
by Segment ($Millions)

The document outsourcing market was valued at approximately $31.5 billion in 2004, and approximately 22% of these revenues came from on-site contracted services.  On-site contracted service agreements have benefited from newer offerings that incorporate document management services and more powerful digital color printers. This is reducing the demand for some categories of off-site contracted services because these projects can now be completed on-site.

Off-site contracted services accounted for 67.3% of the total document outsourcing market in 2004. This segment is expected to achieve a CAGR of 3.8% between 2004 and 2009. While overall segment growth continues to be slow, a careful look at some of the subsegments reveals healthier growth in value-added service areas like data/content services, document consulting services, scanning, and inventory & fulfillment services.

Document process outsourcing (DPO) represents a relatively new, customer-centric category of document outsourcing. InfoTrends/CAP Ventures projects that DPO revenues will increase at a much faster rate then the three traditional segments (on-site contracted services, statement printing, and off-site contracted services), surpassing $1.5 billion and accounting for about 4% of total market revenues in 2009. At the same time, however, it is important to remember that this growth is occurring from a very small base.

Statement printing is expected to experience a CAGR of less than 1% through 2009. Basic statement printing services are under substantial pricing pressure as fierce competition reduces commodity print pricing. Print revenue growth will also slowly disappear from the revenue stream as the migration to online delivery continues over the next decade.

Conclusion

Document outsourcing remains a growth opportunity for service providers who can intelligently address customers’ business challenges with a unique combination of know-how, print business knowledge, and execution excellence. While document outsourcing can minimize corporate investments in non-core support areas, it provides the benefits of the latest technologies. More importantly, it can offer substantial improvements in business performance, leading to greater profitability and enabling customers to increase investments and focus on differentiating activities in their industries. Savvy providers are constantly innovating to deliver new solutions, partnering with customers that bring increased efficiency and new opportunities to both parties. The document outsourcing model addresses customer and supplier objectives by establishing mutually beneficial, long-term partnerships to address evolving business communications needs. Providers who cannot keep pace with customer requirements from a business process viewpoint will suffer defections, revenue shrinkage, and a lack of new business.

The preceding is an excerpt from InfoTrends/CAP Ventures’ report entitled “U.S Document Outsourcing Market Forecast: 2004-2009.” 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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