USD 6.15 billion
Report ID:
SQMIG20I2225 |
Region:
Global |
Published Date: February, 2024
Pages:
157
|Tables:
96
|Figures:
75
Global Procurement Outsourcing Market size was valued at USD 6.15 billion in 2022 and is poised to grow from USD 6.76 billion in 2023 to USD 12.25 billion by 2031, growing at a CAGR of 11.1% in the forecast period (2024-2031).
In recent years, the global Procurement Outsourcing market has been changing consumer preferences. Increasing complexities in supply chain management, coupled with the need for cost optimization, are propelling organizations to outsource their procurement processes.
The demand for specialized expertise in strategic sourcing, supplier management, and procurement analytics is fostering the growth of outsourcing services. Technological advancements, including the integration of AI and automation, are enhancing the efficiency and accuracy of procurement processes.
Furthermore, the trend towards digitalization and the adoption of cloud-based procurement solutions are reshaping the market landscape.
As businesses strive for agility and flexibility, procurement outsourcing emerges as a strategic solution, offering scalability and access to global talent pools. The market is characterized by the presence of key players offering end-to-end procurement services, and the evolving regulatory landscape and emphasis on sustainable and ethical sourcing practices are additional factors shaping the market dynamics.
Global Market Size
USD 6.15 billion
Largest Segment
Strategic Sourcing
Fastest Growth
Procure-to-Pay Outsourcing
Growth Rate
11.1% CAGR
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The global procurement outsourcing market is segmented into four major segments i.e. by service, end-user, organization size, and region. Based on type, it is divided into strategic sourcing, procure-to-pay outsourcing, category management, spend analysis, and supplier management. Based on the end-user industry, it is bifurcated into manufacturing, healthcare, IT and telecom, BFSI (banking, financial services, and insurance), and retail. Based on organization size it is segregated into small and medium-sized enterprises (SMEs), large enterprises, and others. Based on region, the market is segmented into the Middle East, North America, Africa, Asia-Pacific, Europe, and South America.
Analysis by Service
Strategic sourcing plays a pivotal role in optimizing costs, ensuring supplier quality, and enhancing overall procurement efficiency. As organizations increasingly focus on strategic decision-making to drive competitive advantage, strategic sourcing is likely to dominate the market. It involves comprehensive supplier evaluation, negotiation, and relationship management, addressing core elements of procurement strategy.
Procure-to-Pay (P2P) outsourcing is poised for rapid growth due to its end-to-end approach in streamlining the entire procurement process. With an emphasis on automation, P2P outsourcing is well-suited for organizations seeking operational efficiency, reduced cycle times, and enhanced compliance. The integration of digital technologies in the procure-to-pay lifecycle, including robotic process automation (RPA) and AI, positions P2P as a service type experiencing accelerated adoption.
Analysis by End-use
Manufacturing industries often have complex and diverse procurement needs, involving raw materials, components, and logistics. The scale and intricacies of procurement processes in manufacturing make it a dominant end-user segment. The sector's focus on cost efficiency, supplier management, and strategic sourcing aligns well with the comprehensive services offered by procurement outsourcing.
The healthcare sector is anticipated to experience rapid growth in procurement outsourcing due to increasing complexities in healthcare supply chains, stringent regulatory requirements, and the need for cost containment. Outsourcing procurement services can aid healthcare organizations in managing a wide range of products and services while ensuring compliance with industry regulations. The sector's heightened focus on operational efficiency and patient care further drives the adoption of procurement outsourcing.
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North America, particularly the United States, is expected to dominate the procurement outsourcing market. The region has a mature outsourcing industry, with many organizations adopting outsourcing strategies to enhance efficiency and focus on core competencies. The presence of a large number of procurement outsourcing service providers, coupled with the region's emphasis on technological innovation, positions North America as a dominant player.
Asia-Pacific is anticipated to be the fastest-growing region in procurement outsourcing. The region's growing economies, particularly in countries like India and China, are witnessing increased adoption of outsourcing across various business functions, including procurement. The availability of a skilled workforce, cost advantages, and the continuous development of outsourcing infrastructure contribute to the region's rapid growth. As businesses in Asia-Pacific seek to optimize costs and improve operational efficiency, procurement outsourcing becomes a strategic solution, driving its accelerated growth in the region.
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Drivers
Increasing Need for Organizations to Enhance Cost Efficiency
Restraints
High Loss of Control and Visibility Over Critical Procurement Processes
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The competitive environment of the procurement outsourcing market is dynamic and characterized by a diverse array of service providers offering a range of solutions to meet the evolving needs of businesses. The market also features niche players that focus on specific segments, offering specialized solutions in strategic sourcing, supplier management, or specific industry verticals. Collaborations, partnerships, and strategic alliances are prevalent in the competitive landscape, as providers seek to enhance their service offerings and global reach. Additionally, the integration of emerging technologies such as artificial intelligence and robotic process automation is a key competitive differentiator.
Top Player’s Company Profiles
Recent Developments
Rising Integration of Advanced Technologies
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
Global procurement outsourcing market analysis reveals a dynamic marketplace with a number of standout trends and difficulties. The market is driven by a growing need for organizations to enhance cost efficiency, optimize supply chain complexities, and leverage specialized expertise. However, potential restraints include concerns about data security, loss of control over critical processes, and geopolitical uncertainties. Strategic sourcing and end-to-end procurement outsourcing solutions are witnessing increased demand. Geographically, North America dominates the market, propelled by mature outsourcing ecosystems, while Asia-Pacific emerges as the fastest-growing region due to economic development and a skilled workforce. Key trends involve the integration of advanced technologies, a focus on sustainable procurement practices, and a shift towards comprehensive source-to-pay outsourcing models.
Report Metric | Details |
---|---|
Market size value in 2022 | USD 6.15 billion |
Market size value in 2031 | USD 12.25 billion |
Growth Rate | 11.1% |
Base year | 2023 |
Forecast period | 2024-2031 |
Forecast Unit (Value) | USD Billion |
Segments covered |
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Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
Companies covered |
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Customization scope | Free report customization with purchase. Customization includes:-
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Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
For the Procurement Outsourcing Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Procurement Outsourcing Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Procurement Outsourcing Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Procurement Outsourcing Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
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Report ID: SQMIG20I2225