Outsourcing companies face 2024 challenges by expanding into value-added services
A number of experts and officials of outsourcing services companies in Egypt agreed that the industry has witnessed remarkable developments and significant government support during the current year despite the global and local economic challenges that have caused a reduction in companies’ profit margins.
They explained that the outsourcing sector in Egypt is still the focus of all international companies, especially in the field of value-added services, including cloud computing technology and advanced data analytics.
Dr. Karim Hamza, an expert in the outsourcing services industry in Egypt, said that the industry in Egypt witnessed remarkable developments during 2024, as part of companies’ efforts to enhance their position in the local and global markets, but there are many challenges that they faced.
Hamza explained that the most prominent difficulties facing the outsourcing services industry in Egypt are the economic pressures globally and locally, such as inflation and increased operating costs, which affected profit margins, while rapid technological development requires pumping large investments into training and developing the skills of human resources, in addition to the challenges of political stability that affect the investment environment, which makes companies cautious about their expansion.
He stressed that the third challenge is the increasing intensity of global competition, especially from countries such as India and the Philippines, which have a large share of the outsourcing services market, noting that despite Egypt’s efforts to improve the digital infrastructure and increase the number of workers in the sector, the need to improve the efficiency of operations and raise the level of quality remains one of the main obstacles.
He believed that some Egyptian companies were able to achieve remarkable growth in the outsourcing services sector despite the prevailing challenges, benefiting from the digital transformation and the increased global interest in emerging markets, noting that the Egyptian government helped achieve this by providing tax incentives and training programs to qualify the workforce, but the biggest challenge remains in continuing this growth in the long term and ensuring its sustainability amid economic fluctuations.
He added that there are promising areas that can achieve great growth opportunities for the outsourcing services industry in Egypt, most notably artificial intelligence and advanced analytics, especially in customer service and business support, especially with the increased reliance on these modern technologies, in addition to outsourcing services related to financial technology solutions, based on Egypt’s great potential in conjunction with accelerating the pace of digital transformation in the financial and banking sector.
He pointed out that the increasing demand for specialized software and technical development processes also provides a good opportunity to raise the level of outsourcing services, stressing that the outsourcing services industry in Egypt will remain the focus of everyone’s attention despite the challenges.
An official at one of the local outsourcing companies said that 2024 was one of the important years for the outsourcing industry in Egypt, as it witnessed governmental interest at all levels, which contributed to attracting foreign investments to the local market, which is characterized by competencies and competitiveness. The same thing was witnessed by local companies in creating opportunities in many fields in the industry of its basic capital, which is the human element.
Regarding the challenges facing the industry, he explained that local companies still face relative difficulties in competing with their global counterparts, which come with ready-made contracts from abroad, and despite the superiority of many of them in terms of capabilities and solutions, competition is very difficult with global companies.
He pointed out that local companies are facing the issue by providing additional solutions and services that help them support their growth, stressing that this year was very good in general.
An official at one of the local outsourcing companies said that 2024 was one of the important years in the outsourcing industry in Egypt, as it witnessed governmental interest at all levels, which contributed to attracting foreign investments to the local market, which is characterized by competencies and competitiveness. The same thing was witnessed by local companies in creating opportunities in many fields in the industry of its basic capital, which is the human element.
Regarding the challenges facing the industry, he explained that local companies still face relative difficulties in competing with their global counterparts that come with their ready-made contracts from abroad, and despite the superiority of many of them in terms of capabilities and solutions, competition is very difficult with global companies. He pointed out that local companies face the matter by providing additional solutions and services that help them support their growth, stressing that this year was very good in general.
