by: Sarah Joson
Tuesday, February 11, 2014 |
In 2013, only 126 contracts were recorded, which is lower than the deals closed in 2012. It is more in line with the number of deals signed during the period of 2009-2011. During the second half of 2013, volume activity increased by seven percent compared to the first half.
The decrease in number of large-scale contracts in 2013 was caused by the substantial decline of ACV. In fact, for the deals belonging to the $40 million-$99 million bracket, only three were closed compared to 2012’s 12 deals.
A lot of the contracts closed in the Asia-Pacific region were profiled in the $5 million-$39 million range.
According to Sid Pai, Partner and President at ISG Asia-Pacific, 2012 was the best year for the outsourcing sector in the Asia-Pacific region. The executive added that although 2013 was a far cry from 2012’ performance, it banked on the long-term trend in the region. The value of deals below $40 million last year remains consistent with the five-year averages.
Pai noted that over the last 10 years, closed deals have increased by 50 percent, but ACV remained the same and added that with the increased competition, the value of deals is declining as multi-sourcing is slowly being adapted by business executives.
We can help you understand the possibilities. Reach out to us today.