How does inflation in Europe influence the Outsourcing Industry, and how BPO companies can help customers

How does inflation in Europe influence the Outsourcing Industry, and how BPO companies can help customers


In recent years, inflation has become a central topic in economic discussions in Europe, influenced by a series of significant factors. The COVID-19 pandemic has played a major role in disrupting supply chains and increasing production and transportation costs. Additionally, the war in Ukraine has contributed to economic instability, affecting energy and food prices. These events have generated a wave of inflation that has had profound effects on the European economy, influencing various industries, including the outsourcing and Business Process Outsourcing (BPO) sectors.

Inflation in Europe and its impact on industries

In Europe, inflation has reached record levels, with the New York Times reporting an average of nearly 9% in 2022, affecting multiple economic sectors. Although the effects have somewhat subsided since then, the most affected industries include wholesale trade, construction, hospitality and food services, transportation, and warehousing. Increased energy and raw material costs have led to price hikes in essential sectors such as transportation, manufacturing, and construction. In the food industry, higher ingredient and transportation prices have led to increased costs for consumers. The technology and manufacturing industries have faced similar challenges, with rising production costs and supply chain delays. These cumulative effects have negatively impacted profitability, prompting many companies to seek cost-cutting solutions, including outsourcing non-essential activities.

The inflation impact on the outsourcing industry

Inflation in Europe has significantly impacted the outsourcing industry. According to Eurostat, the annual labour costs rose by 4% in 2023, and additional rising operating costs, including wages and rent, have reduced the profit margins of BPO companies. Additionally, economic instability has led to currency fluctuations, complicating international contracts. Outsourcing companies have been forced to adjust their prices and optimize their operations to remain competitive. However, in this context, outsourcing has become an attractive solution for many firms looking to reduce internal costs and maintain operational efficiency in the face of rising prices.

How BPO companies can help clients

BPO companies can help clients cope with inflation by reducing operational costs and increasing efficiency. By outsourcing non-essential activities such as technical support, customer care services, and data management, companies can save resources and focus on their core activities. BPOs offer access to advanced technologies and efficient management practices, which can improve service quality and reduce response times. Additionally, by utilizing locations with lower costs, BPOs can offer competitive pricing, helping clients maintain profitability during periods of inflation.

Advantages of BPO companies in Eastern Europe

BPO companies in Eastern Europe offer excellent conditions for clients, combining competitive costs with high-quality services. Unlike regions in Asia, where prices might be lower, but service quality can vary, BPO firms in Eastern Europe stand out for their professionalism, competence, and use of advanced technologies. These companies benefit from an educated and multilingual workforce, allowing them to provide customized and efficient solutions for clients worldwide.

For companies outside the European Union, BPOs in Eastern Europe represent an attractive option due to the balance between cost and quality. Although outsourcing to these firms may be more expensive than in other regions, the value for money is superior due to high-quality standards and adaptability to the specific needs of clients. Thus, clients benefit from outsourcing services that not only reduce costs but also improve operational efficiency and final customer satisfaction.


In short, inflation affects the outsourcing industry, just as it does many other sectors, prompting companies to take appropriate measures to shield themselves from its negative effects. There are, of course, various measures that can be taken, but one of the most advantageous proves to be collaborating with BPO companies, especially those in Eastern Europe, which offer excellent value for money.