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Are BPO Companies Missing Out on a £5 Billion Opportunity?

Are BPO Companies Missing Out on a £5 Billion Opportunity?

There's a £5 billion opportunity that BPO (Business Process Outsourcing) companies seem to be overlooking. No, I haven't gone mad – hear me out.

By 2026, an estimated 100 million new cars will be sold globally. Let's assume that half of these will be handled by the big groups already transitioning to the Agency Model: VW Group, Stellantis, Geely, Mercedes-Benz, and more will likely follow suit. That's approximately 50 million cars.

Now, suppose that in 2026, two-thirds of these cars will be sold through the "agents" and the remaining one-third directly by the manufacturers. That's nearly 17 million cars.

How will they sell these cars? I guess they'll use a mix of online platforms and flagship stores. And all of this will require remote support.

Manufacturers could try to set up their own call centres, but they'll likely ask their BPO partners to lend a hand.

To achieve this, they'd either need to lead the charge in online retailing, which they lack the expertise for, or let the BPOs take the helm. But the latter presents a different set of challenges because BPOs aren't experts in selling cars.

In theory, manufacturers and BPOs could collaborate closely and learn together, but that's not how their current relationships typically function. They're built on price, not a shared success and open partnership mindset.

Now, picture a BPO partner that cuts through this mess. Instead of FTE billing, they switch to a commission for each car sold. They'd handle everything – from training to retailing and managing the entire sales channel. All the manufacturer would need to do is drive traffic to the channel and provide the logistics.

Let's assume the BPOs charge £300 for each car sold. That's a steal for manufacturers compared to their current costs and a fraction of what they'd spend building these capabilities from scratch.

For an established BPO, it's a different story. They have the infrastructure, training programs, recruitment systems, building, and equipment in place. They'd just need to step up their game by:

  1. Building a team of online dealers, including product and finance expertise with solid remote selling skills.

  2. Developing a robust online sales framework with efficient, data-driven processes and a sales-oriented mindset.

The opportunity? 17 million cars x £300 each equals £5 billion.

While at it, the agents could also fill the downtime by selling connected car services, new mobility solutions, servicing, used car sales, financing, and much more.

How to go about it? Partner with a manufacturer they already have a relationship with, learn the ropes and then transition to this new business model. Once it works for one car maker in one country, expand and collect those logos from around the globe.

Is it easy? No. Is it worth it? Absolutely. This isn't just about making more money; it's about shifting to a new future model where the price per hour isn't the be-all and end-all.


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