Technology Outsourcing Booms in Retail Space

Though various government and academic institutions say we're entering into economic recovery, the recession continues to be a reality in the retail industry, with consumer confidence remaining weak going into the holiday season.

According to a new report by independent market analyst firm Datamonitor, this means companies in Western Europe and North America will increasingly look to outsource technology processes in a bid to cut costs and focus on core skills. The report, "Retailing in a Recession: The Opportunities for Outsourcing," looks at the business processes retailers are outsourcing and why. The report was generated by speaking with industry insiders in retail and technology vendors and bolstered by independent research on the topic.

In this economy, the priority for retailers is to protect margins. In a climate of falling sales, while facing cost and finance pressures, cost cutting has become the main priority in retail, and any option for reducing loss is being considered. This has been a prime opportunity for technology outsourcers and represents a business that's not likely to disappear in the recovery. Companies realizing that tech processes are not a core element of what they do will likely continue to feel this way during the recovery.

"Generally, once companies make a move to outsource, it becomes difficult for them to bring processes back in-house," said Neil Hendry, vice president of consulting – consumer markets, retail markets and financial services at Datamonitor. "First of all, they've obviously made an investment to outsource in order to secure presence in…



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