Procurement outsourcing market to reach $16Bn by 2032: Allied Market Research
DELAWARE, UNITED STATES — The global procurement outsourcing market is projected to reach $16.1 billion by 2032, growing at a compound annual growth rate (CAGR) of 11% from 2024 to 2032.
According to a recent report by Allied Market Research, the market — valued at $6.4 billion in 2023 — is experiencing significant growth due to technological advancements and an increasing demand for enhanced efficiency and productivity.
Key drivers and challenges in procurement outsourcing
The expansion of the procurement outsourcing market is primarily fueled by the need for strategic sourcing and category management.
However, challenges such as loss of control, visibility issues, and concerns over data security and privacy pose potential restraints to market growth. Despite these challenges, the market is expected to benefit from opportunities in strategic sourcing as businesses seek to optimize their procurement processes.
Solution segment dominates market share
In 2023, the solution segment dominated the market by component, as organizations increasingly outsourced procurement to specialized service providers.
This trend is driven by the need to optimize costs, improve efficiency, and focus on core business operations.
The solution segment is anticipated to continue its growth trajectory throughout the forecast period.
Cloud deployment gains traction
Cloud-based solutions held the highest market share in 2023 by deployment type, attributed to their scalability, flexibility, cost-effectiveness, and ease of implementation.
These solutions offer seamless access to procurement services and data, enhancing convenience and accessibility for organizations worldwide.
Large enterprises, BFSI sector drive demand
Large enterprises, with their complex procurement needs and larger budgets, accounted for the highest market share by organization size in 2023.
The banking, financial services, and insurance (BFSI) sector led the market by industry vertical, driven by its intricate procurement requirements, including regulatory compliance and risk management.
The BFSI industry’s reliance on robust procurement solutions is expected to sustain its market dominance.
North America maintains regional dominance
North America emerged as the leading region in 2023, holding the highest market share in terms of revenue.
The region’s dominance is attributed to rapid technological advancements and digital transformations across various sectors, including telecommunications, IT, retail, and finance.
North America’s market is poised for continued growth as businesses increasingly adopt outsourcing services to enhance operational efficiencies.
