July 19, 2024

Growing Demand For Reduced Operational Costs To Boost The Growth Of Procurement Outsourcing Market

The global Procurement Outsourcing Market is estimated to be valued at Us$ 5.15 Bn in 2023 and is expected to exhibit a CAGR Of 11% over the forecast period 2023 To 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Procurement outsourcing helps organizations to maximize cost savings by allowing third-party providers to handle a company’s procurement functions and processes. This enables organizations to focus on their core competencies rather than non-core procurement activities. Outsourcing procurement processes to specialized third-party providers results in reduced operational costs, improved compliance with policies and procedures, and access to industry expertise.

Market key trends:

 

One of the major trends in the procurement outsourcing market is the increasing adoption of software-as-a-service (SaaS)-based procurement solutions. SaaS enables easy implementation and management of procurement tools and solutions. It offers cost-effectiveness as no upfront capital investment is required for licenses, hardware, implementation, and maintenance. Moreover, SaaS-based procurement solutions allow accessing applications from anywhere using an internet connection. This flexibility suits varied business requirements. SaaS solutions also offer seamless integration with other enterprise applications, thereby streamlining procurement processes.

Porter’s Analysis

Threat of new entrants: The procurement outsourcing market requires high initial investments and has established key players, acting as a barrier for new entrants.

Bargaining power of buyers: Buyers have moderate bargaining power due to the presence of substitutes and availability of several procurement outsourcing vendors.

Bargaining power of suppliers: Suppliers have low bargaining power due to the availability of alternative sourcing options and less differentiation in services.

Threat of new substitutes: Alternatives include in-house procurement which poses a medium threat due to associated high fixed costs for clients.

Competitive rivalry: The market has the presence of global and regional players competing on service offerings.

Key Takeaways

The Global Procurement Outsourcing Market Demand is expected to witness high growth, exhibiting CAGR of 11.% over the forecast period, due to increasing need to optimize procurement functions. Regional analysis The Asia Pacific region is expected to grow at the fastest rate in the procurement outsourcing market during the forecast period. Countries such as China, India are dominating the market due to rapid digitalization and outsourcing adoption.

Key players operating in the procurement outsourcing market are Accenture Plc, IBM Corporation, GEP Worldwide, Infosys Limited, Capgemini SE, Genpact Ltd., WNS (Holdings) Limited, HCL Technologies Ltd., Wipro Limited, Tata Consultancy Services Limited, Xchanging Solutions Limited, Corbus, LLC, Proxima Group, Aquanima, CA Technologies (Broadcom Inc.). Accenture holds the leading position in the market attributed to broad service portfolio and global presence.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it