Thursday 3rd July, 2014

According to the Procurement Outsourcing – Annual Report 2014 by Everest Group, the global multi-process Procurement Outsourcing (PO) market registered strong growth of 12 percent in 2013, with a record number of new deals.

End-to-end procurement process outsourcing tripled in share in the last three years, and PO is strengthening its foothold in the emerging markets of Asia Pacific, Middle East and Africa, and Latin America.

While the value proposition of PO remains primarily driven by cost and spend reductions, new themes such as category expertise, access to technology, and integrated governance are emerging and positively shaping the market.

Collaboration between procurement and other enterprise functions is also driving growth. For example, nearly 75 percent of procurement contracts had Human Resource-related categories in 2013, compared to 67 percent previously.

Abhishek Menon, Practice Director at Everest Group said; "The industry’s compounded annual growth rate is about 18 percent from 2006 to 2013, and the number of new deals signed each year has more than doubled in that same timeframe. Procurement outsourcing makes an attractive business case for both buyers and service providers..."