The global Procurement Outsourcing Market is estimated to be valued at US$ 5.15 billion in 2023 and is expected to exhibit a CAGR of 11.7% over the forecast period 2023-2030. Procurement outsourcing involves the delegation of procurement functions to a third-party service provider, allowing companies to focus on core competencies and achieve cost savings. The market for procurement outsourcing is driven by the increasing complexity of supply chains, rising demand for cost optimization, and the need for efficient procurement processes. Additionally, the emergence of advanced technologies such as artificial intelligence and analytics has further enhanced the market growth by improving operational efficiency and decision-making.
Market Key Trends:
One key trend in the procurement outsourcing market is the adoption of cloud-based solutions. Cloud-based procurement outsourcing platforms offer various advantages such as scalability, flexibility, and cost-effectiveness. These platforms enable companies to streamline and automate their procurement processes, resulting in improved efficiency and cost savings. Moreover, cloud-based solutions provide real-time visibility into the procurement cycle, enabling better decision-making and supplier management. The increasing adoption of cloud computing and digitalization across industries is fueling the demand for cloud-based procurement outsourcing solutions. Key players in the market such as Accenture Plc, IBM Corporation, and Genpact Ltd. are investing in the development of cloud-based platforms to cater to the growing market demand.
Segment Analysis:
The procurement outsourcing market can be segmented based on service type, industry vertical, and region. Based on service type, the market can be further divided into indirect procurement and direct procurement outsourcing. Currently, indirect procurement dominates the market due to the increasing adoption of outsourcing services by various industries. Indirect procurement involves the outsourcing of non-core and non-production related procurement activities such as office supplies, travel expenses, and facility services. Many organizations prefer to outsource these activities to reduce costs and improve operational efficiency.
On the other hand, direct procurement outsourcing refers to the outsourcing of core and production-related procurement activities such as raw material sourcing, supplier management, and contract management. Although direct procurement outsourcing is a smaller segment in the market, it is expected to witness significant growth during the forecast period. This growth can be attributed to the increasing focus on cost optimization, supply chain visibility, and strategic procurement by organizations.
Key Takeaways:
The Global Procurement Outsourcing Market Demand is expected to witness high growth, exhibiting a CAGR of 11.7% over the forecast period from 2023 to 2030. This growth can be attributed to several factors, including the increasing complexity of procurement processes, the need for cost reduction, and the growing adoption of technology solutions in procurement activities. Companies are increasingly realizing the benefits of outsourcing non-core procurement activities to focus on their core competencies and strategic initiatives.
In terms of regional analysis, North America is expected to be the fastest-growing and dominating region in the procurement outsourcing market. This growth can be attributed to the presence of several key players in the region, as well as the high adoption of outsourcing services by various industries, such as manufacturing, healthcare, and retail. Furthermore, the increasing digitalization and automation of procurement processes in North America are driving the demand for outsourcing services.
Key players operating in the procurement outsourcing market include 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, and CA Technologies (Broadcom Inc.). These players have a strong presence in the market and offer a wide range of procurement outsourcing services to cater to the diverse needs of clients. They focus on strategic partnerships, acquisitions, and product innovations to maintain their competitive edge in the market.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
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