Procurement Outsourcing Market is Estimated to Witness High Growth Owing to Increased Focus on Core Competencies

Procurement Outsourcing Market


 Procurement outsourcing refers to outsourcing of non-core procurement functions to third-party procurement service providers. It enables organizations to focus on their core competencies by outsourcing support functions such as supplier management, purchase order management, contract management, sourcing and procurement to specialized service providers. Procurement outsourcing providers help reduce procurement costs, enhance procurement productivity and efficiency, and ensure compliance with industry and regional procurement regulations.


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 6.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Dynamics:
Increased focus on core competencies remains a key driver propelling the growth of the procurement outsourcing market. By outsourcing non-core procurement functions, organizations are able to focus internal resources on revenue generating and innovation driven core business activities. This helps improve overall business productivity and competitiveness. Moreover, procurement outsourcing also helps reduce procurement costs through economies of scale achieved by service providers. Specialized service providers are able to leverage their expertise and integrated technology solutions to enhance procurement efficiency and ensure compliance. These factors are expected to continue supporting the increased adoption of procurement outsourcing over the forecast period.

SWOT Analysis

Strength: Procurement outsourcing reduces operational costs and frees up resources that can be allocated to core business activities. By outsourcing procurement, companies can leverage specialized expertise and advanced technologies of service providers. Outsourcing non-core activities also allows companies to focus on strategic functions.

Weakness: Relying excessively on external providers for procurement raises concerns about loss of control and visibility. Important procurement decisions may no longer be made internally. There is also a risk of over-dependence on few outsourcing partners.

Opportunity: New technologies like artificial intelligence, machine learning, blockchain, and strategic sourcing tools are creating opportunities for automation and process optimization. Digital transformation of the supply chain is increasing demand for managed procurement services. Growth of industries like manufacturing, retail and pharmaceuticals augurs well for outsourced procurement.

Threats: Economic uncertainties and geopolitical tensions pose challenges. Protectionist policies could disrupt global supply chains. Cyclical downturns in major industries may temporarily dampen outsourcing spend. Intense competition among service providers exerts pricing pressures.

Key Takeaways

The Global Procurement Outsourcing Market Share is expected to witness high growth over the forecast period of 2023 to 2030. Advancements in technology and the desire to streamline operations are driving increased adoption of outsourced procurement solutions across industries. 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 6.5% over the forecast period 2023 to 2030.

Regional analysis suggests that North America currently dominates the market due to the strong presence of outsourcing service providers and major sourcing hubs. However, Asia Pacific is anticipated to grow at the fastest pace owing to the rapidly expanding manufacturing and industrial sectors in China, India, Japan and Southeast Asia.

Key players operating in the procurement outsourcing market are Accenture, IBM, GEP, Infosys, Capgemini, HCL Technologies, WNS, TCS, and Wipro. These companies offer comprehensive managed procurement solutions including source-to-pay processes, supply chain consulting, spend analysis, supplier enablement and contract management on an outsourced model.

For more details on the report, Read- https://www.ukwebwire.com/procurement-outsourcing-market-trends-size-and-share-analysis/

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