The global procurement-as-a-service market is expected to be worth $9.3bn by 2025, according to a report.
The market is set to expand by 7.3% per year from 2019 to 2025, according to the report by Grand View Research, which will be mainly due to the rapid proliferation of digital technologies. These are redesigning business supply chains and are set to transform the way the procurement function delivers value.
According to the report, sourcing and procurement functions normally manage 40-80% of total organisational spending – an amount that has increased rapidly in line with rises in organisations’ indirect spending.
The manufacturing segment is expected to have held the largest revenue share of the procurement-as-a-service market in 2018, while figures are predicted to show that North America dominated the market in that year, accounting for more than 46.0% of the overall value.
The most prominent players in the global procurement-as-a-service market were included Accenture, Aegis, HCL Technologies Ltd, IBM, GEP, Genpact, Infosys, Wipro, WNS (Holdings) Ltd, and Tata Consultancy Services Limited.
One area driving the growth of procurement as a service is the IT sector, where there is a growing need to provide enhanced user experience to meet the expectations of consumers, the report said.
“As businesses are swiftly moving to the cloud, the procurement software providers are updating their offerings to web-based applications,” it said.
“This ultimately helps to enhance the business operations and reduce supply chain disruptions as well as strengthen supplier and vendor relationships.”
The report said providers are integrating artificial intelligence and internet of things with analytics to build platforms that use machine learning to identify and address anomalies for fleet management and shipment tracking.
“The growth is attributed to the growing necessity to manage complex acquisition contracts such as public infrastructure projects,” said the report.
“Such deals require expertise and time to deliver enhanced outcomes. Hence, large enterprises are increasingly adopting the service to minimise their operational costs and eliminate complexities.”
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