IT companies generally take advantage of subcontractors to meet projects with specific skills.
With a deceleration in the demand of IT in key markets such as the USA and Europe, top -level IT players have tried to control the cost of the subcontractor as a liver to maintain and improve the margins. In fiscal year 2015, the subcontractor costs as a percentage of income reached a minimum of seven years for three best TCS, Wipro and HCl Tech. For Infosys, it reached a minimum of 4 years.
TCS reported that subcontractors cost ₹ 11,046 million rupees in fiscal year 2015, which represents a 26 percent decrease in Yoy. This resulted in a strong drop in the cost of subcontracting as a percentage of income of 6.2 percent in fiscal year 2014 to 4.3 percent in fiscal year 2015. This was like the high axis of 9.2 percent of the income in the fiscal year23. HCl Tech, who reported his profits on Tuesday, also saw a decrease in the cost of subcontractors as a percentage of income from 14.7 percent in the 2014 fiscal year to 13 percent in fiscal year 2015. For Wipro, this decreased from 11.5 percent in fiscal year 2014 to 11.2 percent in fiscal year 2015, reaching a minimum of seven years.
Specific skills sets
IT companies generally take advantage of subcontractors (or contract staff) for Fulfif Projects with specific skills that may not easily be informed internally with their equipment. This expenditure generally tenders in the deceleration phase as Ti Services companies seek to manage margins by reducing costs in the absence of income growth. The cost of subcontracting is destined for staff and experts in the Indian contract and on the site they notice that in the United States, specialists often prefer to work in concert.
“A decrease in the costs of the subcontractor of the signals submitted to the general demand. Uneuneunhinsight said.
Prashant Shukla,The vice president, Everest Group, said that this also points out the growing preference for relocation. “The maturity of the opened land centers by service providers on several -year adjustments also facilitates the pressure of having greater subcon costs,” he added.
Niche experience
“It companies use subcontractors to gain access to niche expertise, address Quick-Burs Skill Needs and Scale Up Discretionary Program. Given that Discretionary Program Are Drying Up, Companies Are Maximiz Even Liver, Redultation Rate-Contracting, Use. Use ,, usering-collision, useful, useful, usering-contracting.
Industry trackers also point out that Ti’s approach on the margins can be to prevent bold bets.
“Subcontracting gives the company access to specialized skills that may not be Avia-House. Therefore, being conservatives, they may also be losing the persecution of work of the new age that comes in short-term periods,” said a former Ti industry executive.
Posted on April 22, 2025