Procurement Analytics Market By Component (Solutions, Services), Deployment Mode (Cloud, On-premises), Organization Size (Small and Medium-sized Enterprises (SMEs), Large Enterprises), Application (Spend Analytics, Risk Analytics, Supply Chain Management, Vendor Analytics, Contract Management), End-use Industry (Government and Defense, Banking, Financial Services and Insurance (BFSI), Healthcare, IT and Telecom, Education, Retail & eCommerce, Manufacturing), & Region for 2024-2031

Procurement Analytics Market Valuation – 2024-2031

The growing need for data-driven insights to improve decision-making, streamline procurement procedures, and reduce risks throughout supply chains is propelling the procurement analytics market. According to the analyst from Verified Market Research, the procurement analytics market is estimated to reach a valuation of USD 25.18 Billion over the forecast subjugating around USD 4.85 Billion valued in 2024.

The increased usage of advanced analytics solutions by firms aiming to optimize procurement operations, identify cost-saving possibilities, and improve supplier management propels this market forward. It enables the market to grow at a CAGR of 25.51% from 2024 to 2031.

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Procurement Analytics Market: Definition/ Overview

Procurement analytics is the systematic examination of procurement data to produce actionable insights that help optimize purchasing processes, manage supplier relationships, and improve overall procurement efficiency. It entails using advanced analytical tools to investigate many elements of procurement, such as spending trends, supplier performance, contract compliance, and risk management. Organizations use procurement analytics to make educated decisions, identify cost-saving possibilities, negotiate better terms with suppliers, reduce risks, and improve overall operational effectiveness.

Furthermore, procurement analytics applications include spend analysis, supplier performance management, contract management, demand forecasting, inventory optimization, and compliance monitoring. Procurement analytics enables firms to achieve more transparency, efficiency, and strategic alignment in their procurement activities by leveraging data-driven insights, resulting in business success.

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What Factors Contribute to the Growth of the Procurement Analytics Market?

Many companies are undergoing digital transitions to improve operational efficiencies and lower costs. Procurement analytics is essential to this change because it provides insights that help to improve procurement processes, optimize supply chains, and reduce risks. The need for procurement analytics that can decipher complicated data and deliver useful insights is growing as more companies embrace digital solutions.

In today’s competitive business world, organizations constantly seek methods to reduce expenses and boost their bottom line. Procurement analytics allows firms to conduct extensive spending analysis, assisting them in identifying cost-saving opportunities, negotiating better contracts, and making informed purchase decisions. The need to optimize spending and generate cost savings is an important driver for the adoption of procurement analytics solutions.

Furthermore, procurement analytics tools give real-time data and insights required to make informed decisions. These tools assist procurement managers in evaluating supplier performance, managing risks, and complying with rules. The capacity to make more timely, data-driven judgments not only improves procurement process efficiency but also increases the procurement function’s overall strategic effect within enterprises.

What are the Challenges that Hinder the Demand for the Procurement Analytics?

The quality and consistency of data is a major difficulty in procurement analytics. Many businesses suffer from various data sources, inconsistent data formats, and data silos, making it difficult to integrate and analyze data effectively. Poor data quality causes inaccurate analytics, which leads to incorrect insights and conclusions. Ensuring data integrity and integration from several sources remains a fundamental barrier to efficient procurement analytics, thereby limiting market growth.

Furthermore, the proper application of procurement analytics technologies necessitates specific data analysis, interpretation, and decision-making skills. There is a talent gap in organizations, and procurement professionals may lack the analytical skills required to properly exploit these tools. This difficulty involves continual training and maybe hiring new staff with the necessary abilities, which is costly and time-consuming, hence limiting the market’s expansion.

Category-Wise Acumens

How Does the Demand for Greater Transparency Propel the Demand for Supply Chain Management?

According to VMR Analysis, the supply chain management segment is estimated to hold the largest market share in the application segment during the forecast period. Transparency in supply chains is becoming increasingly important due to regulatory constraints and customer desires. SCM analytics gives visibility into the supply chain, allowing businesses to track the origin of items, verify environmental and labor compliance, and respond quickly to market changes or disruptions. This skill is critical for preserving trust and adaptability in a competitive market.

Modern supply chains are getting more global and complicated, with various parties and processes. Supply chain management (SCM) analytics assist firms in negotiating this complexity by giving insights into every stage of the supply chain, from raw material sourcing to finished product delivery. This allows businesses to optimize routes, manage inventories more efficiently, and anticipate disruptions.

Furthermore, Geopolitical problems, natural calamities, and economic swings all pose hazards to supply systems. SCM analytics enables firms to detect potential supply chain risks and weaknesses, as well as establish risk mitigation methods. Predictive analytics allows businesses to anticipate possible problems and take early solutions, decreasing the impact of disruptions on operations.

What are the Factors that Contribute to the Demand in the Retail and E-commerce Sector?

The retail & E-commerce segment is estimated to dominate in the procurement analytics market during the forecast period. Retail and eCommerce organizations deal with vast and diverse supplier networks, as well as enormous inventories. The need to properly manage these, assure timely refilling, and reduce overstock or stockouts is driving procurement analytics use. These technologies offer useful insights into supplier performance, demand forecasting, and inventory optimization, all of which are essential for sustaining operational efficiency and customer satisfaction.

The retail sector has razor-thin profit margins and fierce rivalry. Procurement analytics assists retailers in identifying cost-saving opportunities, negotiating better terms with suppliers, and optimizing their spending. Retailers can get a competitive advantage and increase profitability by using sophisticated expenditure analysis and cost control features.

Furthermore, in retail and eCommerce, understanding consumer behavior and market trends is critical. Procurement analytics tools can evaluate purchasing habits, seasonal trends, and consumer preferences, allowing merchants to adjust their procurement strategies as needed. This adaptability enables merchants to have the correct products at the right time, thereby aligning their offerings with market expectations and maximizing sales prospects.

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Country/Region-wise Acumens

How Does Advanced Technological Infrastructure Contribute to the Dominance of North America?

According to VMR analyst, North America is estimated to dominate the procurement analytics market during the forecast period. North America, particularly the United States and Canada, has a rich technological infrastructure and a large number of premier technology businesses. This advanced infrastructure enables the development and deployment of cutting-edge technologies such as big data analytics, artificial intelligence, and machine learning, all of which are critical components of modern procurement analytics systems. The region’s capacity to incorporate these technologies into procurement procedures increases the efficacy and appeal of procurement analytics solutions.

The region has a highly competitive and mature business climate, with companies always seeking operational efficiency and strategic advantages. The necessity for firms in this region to maintain competitiveness through cost reduction, smarter procurement methods, and strengthened supplier relationships is driving the adoption of procurement analytics. Companies in this region are more likely to invest in technology with high return on investment, such as procurement analytics.

Furthermore, businesses in North America have strict regulatory constraints, necessitating transparent and compliant procurement processes. Procurement analytics solutions assist firms manage risks and ensuring regulatory compliance by giving insights into supplier practices, contract compliance, and spend analysis. This skill is especially important in businesses like as healthcare, banking, and government, where compliance and risk management are paramount.

What are the Key Drivers Influencing the Adoption of Procurement Analytics in the Asia Pacific?

The Asia Pacific region is estimated to grow at the highest CAGR for the procurement analytics market during the forecast period. Asia-Pacific is experiencing a strong economic expansion, with many countries spending extensively in manufacturing and retail industries. These sectors require effective procurement systems to manage complicated supply networks and large-scale manufacturing operations. The need for improved spend visibility, cost management, and supplier relationship management in these growing industries supports the adoption of procurement analytics solutions.

Governments and companies in Asia Pacific are aggressively pursuing digital transformation initiatives. Countries such as China, India, Japan, and South Korea are at the forefront of integrating digital technologies into business processes. Procurement analytics is an important part of this transition because it delivers the data-driven insights required to optimize procurement strategy and operational efficiencies.

Furthermore, the Asia Pacific region has a thriving start-up environment that is driving innovation in technological fields such as software development and artificial intelligence. This innovation culture encourages the creation and use of advanced procurement analytics technologies. Also, the readiness of these start-ups to adapt to new technology helps to expand and diversify the market’s procurement solutions.

Competitive Landscape

The competitive landscape of the procurement analytics market is characterized by a dynamic ecosystem shaped by variables such as technical improvements, market consolidation, and changing client expectations.

Some of the prominent players operating in the procurement analytics market include:

• SAP SE
• Oracle Corporation
• SAS Institute, Inc.
• IBM Corporation
• Coupa Software, Inc.
• Zycus, Inc.
• Jaggaer, Inc.
• Genpact Limited
• GEP
• Corcentric
• Accenture
• Rosslyn Data Technologies
• Microsoft
• Cisco Systems, Inc.

Latest Developments

• In April 2024, Jaggaer announced the launch of its new solution, Jaggaer ONE Risk Management. This new product is specifically designed to improve the procurement process by providing comprehensive tools for risk detection, evaluation, and reduction. The solution attempts to provide a proactive approach to controlling procurement risks, allowing businesses to keep ahead of any difficulties that may affect their operations.
• In January 2024, Accenture announced the acquisition of Impendi, a sourcing and procurement services company that focuses on private equity clients. This strategic move is intended to considerably strengthen Accenture’s capabilities inside the private equity industry, providing an increased range of services from due diligence to value generation and delivery.

Report Scope

Procurement Analytics Market, By Category

Component:

• Solutions
• Services

Deployment Mode:

• Cloud
• On-premises

Organization Size:

• Small and Medium-sized Enterprises (SMEs)
• Large Enterprises

Application:

• Spend Analytics
• Risk Analytics
• Supply Chain Management
• Vendor Analytics
• Contract Management
• Others

End-User Industry:

• Government and Defense
• Banking, Financial Services, and Insurance (BFSI)
• Healthcare
• IT and Telecom
• Retail and eCommerce
• Manufacturing
• Others

Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Research Methodology of Verified Market Research:

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• Qualitative and quantitative analysis of the market based on segmentation involving both economic as well as non-economic factors
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• Competitive landscape which incorporates the market ranking of the major players, along with new service/product launches, partnerships, business expansions and acquisitions in the past five years of companies profiled
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