Generative AI in Procurement Market Report 2025

This report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market’s historic and forecast market growth by geography.

The generative AI in procurement market size has grown exponentially in recent years. It will grow from $0.16 billion in 2024 to $0.2 billion in 2025 at a compound annual growth rate (CAGR) of 29.3%. The growth in the historic period can be attributed to increased data availability, complexity in supply chains, vendor relationships, focus on strategic procurement, and the rise of big data.

The generative AI in procurement market size is expected to see exponential growth in the next few years. It will grow to $0.56 billion in 2029 at a compound annual growth rate (CAGR) of 28.9%. The growth in the forecast period can be attributed to increased adoption of cloud computing, integration with IoT and big data, expansion of industry-specific solutions, emphasis on sustainability, and rise of autonomous procurement. Major trends in the forecast period include AI-driven predictive analytics, autonomous procurement, dynamic pricing optimization, conversational AI interfaces, and multi-modal data fusion.

The increasing demand for cloud services is poised to drive the expansion of generative artificial intelligence (AI) within the procurement market in the foreseeable future. Cloud services, which encompass computing services accessed via the internet, including storage, databases, and software, are offered by cloud computing providers, eliminating the need for on-premises infrastructure. The growing reliance on cloud services is fueled by the pursuit of agility, innovation, cost efficiencies, and competitive advantages in an increasingly digital and interconnected global landscape. Generative AI technology in procurement benefits from the robust computational capabilities and scalability provided by cloud services, enabling companies to fully leverage generative AI algorithms while capitalizing on the adaptable, easily accessible, and cost-effective nature of cloud computing infrastructure. For instance, Eurostat, the Luxembourg-based statistical office of the European Union, reported in December 2023 that the adoption rate of cloud computing services among medium-sized enterprises rose to 59% in 2022 from 53% in 2021. Hence, the growing need for cloud services is propelling the growth of generative artificial intelligence (AI) in the procurement market.

Key players in the generative artificial intelligence (AI) procurement market are developing innovative solutions such as the generative AI Suite to enhance the competitive edge of finance and procurement teams. A generative AI suite for procurement encompasses a suite of AI-powered tools and solutions aimed at streamlining and optimizing various facets of the procurement process. For instance, in October 2023, ZIP, a US-based provider of cutting-edge software solutions, unveiled its Generative AI Suite, revolutionizing team workflows by offering advanced tools and capabilities. The suite includes predictive analytics, automated insights, supplier relationship management, and contract management, seamlessly integrating AI into request intake, approval, and contract renewal workflows. This integration eliminates the need for thousands of hours that employees would otherwise spend on labor-intensive vendor contract reviews and error-prone data entry for purchase requests, purchase orders, and invoices.

In November 2022, Simfoni Limited, a US-based software company, acquired Xeeva, Inc. for an undisclosed sum, enhancing its procurement and spend management solution offerings. This acquisition expands Simfoni's capabilities, allowing it to provide more comprehensive solutions to its clients. Xeeva, Inc., a US-based company specializing in AI and intelligent cloud-based procurement and spend management technologies, adds significant value to Simfoni's portfolio.

Major companies operating in the generative AI in procurement market report are Google LLC; Microsoft Corporation; Dell Technologies Inc.; Amazon Web Services Inc.; International Business Machines Corporation (IBM); Oracle Corporation; Jabil Optics Germany GmbH; SAP SE; Genpact Limited; GEP Worldwide; Zoho Corporation Pvt. Ltd.; Coupa Software Inc.; Basware Corporation; Zycus Inc.; Jaggaer Holdings Inc.; Tradeshift Holdings Inc.; Ivalua Inc.; Agiloft Inc.; Master of Code Global Inc.; Sirion Inc.; Scoutbee GmbH; Simfoni Limited; LevaData Inc.; Aavenir Inc.; Suplari Inc.

North America was the largest region in the generative AI in procurement market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the generative AI in procurement market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the generative AI in procurement market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The generative artificial intelligence (AI) in procurement market consists of revenues earned by entities providing services such as automated document generation, supplier selection and evaluation, contract management, supplier relationship management, and invoice and payment processing. The market value includes the value of related goods sold by the service provider or included within the service offering. The generative artificial intelligence (AI) in procurement market also includes sales of market intelligence platforms, payment automation tools, AI-powered procurement analytics platforms, blockchain-based procurement platforms, and compliance monitoring tools. Values in this market are ‘factory gate’ values, that is, the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

Generative artificial intelligence (AI) applied in procurement refers to the utilization of AI algorithms and technologies to optimize and streamline diverse facets of the procurement process within businesses and organizations. It is employed to automate document creation, predict demand, assess suppliers, and optimize pricing, thereby enhancing efficiency and decision-making throughout procurement.

The primary categories of generative artificial intelligence (AI) in procurement include direct procurement, indirect procurement, goods procurement, and service procurement. Generative AI in direct procurement entails the use of artificial intelligence to simplify the sourcing and acquisition of goods and services directly linked to production processes, such as raw materials and machinery. Different sizes of organizations, ranging from large enterprises to small and medium enterprises, leverage these technologies for various purposes, including supplier identification, product or service recommendations, negotiation assistance, risk evaluation, contract analysis, fraud detection, predictive modeling, and more.

The generative artificial intelligence (AI) in procurement market research report is one of a series of new reports that provides generative artificial intelligence (AI) in procurement market statistics, including generative artificial intelligence (AI) in procurement industry global market size, regional shares, competitors with a generative artificial intelligence (AI) in procurement market share, detailed generative artificial intelligence (AI) in procurement market segments, market trends and opportunities, and any further data you may need to thrive in the generative artificial intelligence (AI) in procurement industry. This generative artificial intelligence (AI) in procurement market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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