Procurement Outsourcing Global Market Report 2024

The procurement outsourcing market size has grown rapidly in recent years. It will grow from $4.13 billion in 2023 to $4.78 billion in 2024 at a compound annual growth rate (CAGR) of 15.6%. The growth observed in the historic period can be credited to factors such as cost efficiency, emphasis on core competencies, globalization, risk management, and flexible resource allocation.

The procurement outsourcing market size is expected to see rapid growth in the next few years. It will grow to $8.01 billion in 2028 at a compound annual growth rate (CAGR) of 13.8%. The anticipated growth in the forecast period can be ascribed to strategic sourcing, sustainability, and corporate social responsibility (CSR), resilience planning, the demand for specialized skills, as well as data security and compliance. Key trends expected during this period encompass digital transformation, technological advancements, agile and flexible procurement models, data analytics and business intelligence, and a heightened emphasis on strategic sourcing.

The anticipated growth of the e-commerce industry is set to drive the expansion of the procurement outsourcing market in the coming years. E-commerce, encompassing the online buying and selling of goods and services, utilizes procurement outsourcing for effective management of supplier contracts, ensuring compliance, and identifying opportunities for renegotiation. For example, in October 2023, as reported by the Boston Consulting Group Inc., e-commerce sales in Europe saw a 3% increase, while in the US and Asia, they recorded a 7% rise in 2022. Furthermore, the global e-commerce sector is projected to experience a 9% annual growth by 2027. Consequently, the burgeoning e-commerce industry is expected to be a catalyst for the growth of the procurement outsourcing market.

The escalating pace of urbanization is also poised to propel the expansion of the procurement outsourcing market in the future. Urbanization, marked by a rising proportion of the population residing in towns and cities, leads to the development and enlargement of urban areas as individuals migrate from rural to urban settings. Procurement outsourcing is utilized in urbanization processes to efficiently manage and streamline the acquisition of goods and services for expanding city populations, facilitating cost savings, process optimization, and improved strategic sourcing capabilities. As an illustration, in December 2022, the United Nations Conference on Trade and Development (UNCTAD) reported that the urban population's share was projected to reach 56.5% in 2021, with Africa experiencing a 4.6 percentage point increase during the same period. Thus, the increasing rate of urbanization serves as a driving force for the procurement outsourcing market.

The anticipated increase in privacy and security concerns is expected to impede the growth of the procurement outsourcing market. Organizations, especially in sensitive industries, are becoming more cautious about outsourcing their procurement processes to third-party providers due to apprehensions regarding potential breaches and unauthorized access to confidential procurement data. This wariness stems from the fear that such incidents could compromise sensitive information and disrupt the integrity of the supply chain. For instance, in 2023, according to the CISCO Data Privacy Benchmark Study 2023 by Cisco Systems Inc., a technology company based in the US, 95% of respondents consider privacy as a crucial business necessity, reflecting a notable increase from 90% in 2022. Moreover, 94% believe that customers are unlikely to make purchases from businesses lacking proper data protection. Additionally, the Cost of a Data Breach Report by International Business Machines Corporation in 2023 estimates the average cost of a data breach to reach $4.2 million. Consequently, the escalating privacy and security concerns are acting as a constraint on the growth of the procurement outsourcing market.

Leading companies in the procurement outsourcing market are actively developing innovative technologies to address industry challenges. One such example is the Coupa app marketplace, designed to connect customers with third-party solutions. The marketplace provides consumers with access to a diverse range of apps that enhance procurement operations' efficiency. For example, in August 2021, Coupa Software Inc., a US-based business spend management software company, introduced the Coupa app marketplace. The marketplace's apps cover various services, including procurement software, travel and expense management, contingent labor management, and contract administration. Notably, the Coupa App Marketplace is the first marketplace in the business service management (BSM) field to offer solutions that extend a customer's existing tech stack and enhance their BSM capabilities. This allows for seamless information sharing, workflow automation, and critical activities. The marketplace encompasses solutions ranging from supply chain analytics to supplier risk analysis, travel and expense management, and IT management, all designed to be adaptive, connected, and efficient.

In August 2023, International Business Machines (IBM) Corporation, a technology corporation based in the United States, successfully acquired Apptio Inc. for an undisclosed amount. This strategic acquisition is geared towards expanding IBM Corporation's product offerings and diversifying the automation products accessible to end-users. The move is aimed at strengthening IBM's IT automation portfolio, providing enterprises with a comprehensive technology management platform that facilitates optimization and automation of decisions across their IT environments. Apptio Inc., the acquired company, is a US-based provider of software-as-a-service applications and plays a crucial role in the supply chain of IT services, including offerings related to procurement outsourcing.

Major companies operating in the procurement outsourcing market report are Microsoft Corporation, Siemens AG, General Electric Company, Accenture PLC, International Business Machines Corporation, Ernst & Young LLP, SAP SE, Tata Consultancy Services Limited, Capgemini SE, Cognizant Technology Solutions Corporation, Infosys Limited, DXC Technology Company, Wipro Limited, HCL Technologies Limited, Rockwell Automation Inc., CGI Inc., Concentrix Services India Private Limited (CSIPL), GEP Worldwide, WNS Denali, JAGGAER, Corbus LLC, Aquanima SA, Xchanging Solutions Limited, Intetics Inc., Aegis One Consults Ltd.

North America was the largest region in the procurement outsourcing market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the procurement outsourcing market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the procurement outsourcing market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Procurement outsourcing involves delegating specific critical procurement tasks related to sourcing and supplier management to a third-party service provider. This approach is employed by service providers to reduce their overall costs or allocate more time for businesses to focus on their core strengths.

The primary components of procurement outsourcing include solutions and services. A solution refers to a software application designed to help businesses automate the process of obtaining services from third-party vendors. The diverse enterprises engaged in this practice range from large enterprises to small and medium enterprises, utilizing on-premises and cloud solutions. The sectors benefiting from procurement outsourcing encompass banking, financial services, insurance (BFSI), energy and utilities, healthcare, IT and telecom, professional services, manufacturing, retail, logistics, and other industry verticals.

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

The procurement outsourcing market includes revenue earned by entities by providing services such as direct procurement, indirect procurement, goods procurement, and services procurement. 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).

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.


This product will be delivered within 3-5 business days.