European outsourcing sees strong growth

Fourth quarter of 2005 sees 102 new deals, says analyst survey

The number of European outsourcing deals rose 25 per cent in the last quarter of 2005, compared to the same period of 2004, according to analyst Forrester Research.

The figure represents one of the most active periods ever seen in the European outsourcing market by the research firm.

Growth in outsourcing activity at the end of the year was partly seasonal, the analyst says, but was also caused by a large number of deals from countries in Scandinavia, Southern Europe and the Benelux.

'Despite the lower deal numbers from UK firms this time, the aggregate outsourcing activity in contract value remained very large indeed,' said the report.

The surveyalso suggests traditional outsourcing deals are in continued decline, with companies increasingly focusing on just one specific area of service.

Mega-deals are also in a continuing decline with most outsourcing contracts in the fourth quarter on or below the €50m mark (£34m).