According to the latest research report published by ValueNotes, a leading research and analytics firm, BPM providers in publishing industry are facing a severe financial crunch. The report states that since 2008, BPM providers in the publishing industry, especially the ones in India have been facing a decline in the revenue generated. It is said that the service providers in the industry are adversely affected by global economic crisis of 2008 and they still have not recovered from it.
ValueNotes is a leading provider of research based business intelligence services. They have been providing research and analytics services to companies from varied industries, markets and geographies. They help the clients to gain competitive advantage by providing useful and reliable information for the clients. Their services include research services, information products, competitive intelligence consulting and financial and equity research services.
The report titled “Outsourced Publishing Services: Financial Performance Review” published by ValueNotes provides insight into the future of the BPM providers in publishing industry. The report was published after conducting a study of the financial performance of the 12 key players in the analytics service industry having operation in India. This is the second of a series of financial reports published by ValueNotes on the Knowledge Process Management sector. The study covers the financial performance of the companies during the fiscal year 2007 to 2011. The report also provides the relative position of the providers from India in the industry and the evaluation was done based on the following parameters:
- Total income
- Revenue per employee
- Total cost per employee
- EBITDA margin
- Net profitable form per employee
- Net operating cycle
- Quick ratio
- Debt/Equity ratio
- Return on equity
Excerpts from the report:
- The Indian service providers serving the publishing industry are facing a 34% decline in revenue since the past two years despite the fact that Indian players are the most sought after sourcing partners for global publishing companies.
- In 2011, the revenue of large players in the analytics industry fell more than half of what they earned in 2009.
- The future of the BPM providers in publishing industry does not seem to be promising. According to the report, the success and future will depend on the financial management of the companies.
- Increase in the interest expense affected the net profit margin of medium-sized service providers despite a positive operating profit.
- According to the report, even though there has been a deep decline in the profit, the large providers were able to manage the downturn better. When they faced decline in revenue, they responded by optimizing their finance, a move which mid-sized companies should look upon if they want to survive.
- KGL, Integra, Altivolus Infotech, KiwiTech and Quadrum stood top in the list in financial performance.