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The procurement software market size is estimated to increase by USD 4.90 billion, growing at a CAGR of 10.2% between 2022 and 2027. Improvements in business efficiency emerge as crucial factors propelling the market forward. Through comprehensive procurement analysis covering various aspects of the process, organizations gain numerous advantages, including improved supplier management facilitated by comprehensive data oversight. Moreover, these solutions assist in identifying business risks and trends, streamlining the management and planning of complex contracts and projects, thereby accelerating business operations.
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This market report extensively covers market segmentation by deployment (cloud and on-premises), end-user (retail and e-commerce, healthcare and pharmaceuticals, manufacturing and automotive, IT and telecom, BFSI, and others), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The market share growth by the cloud segment will be significant during the forecast period. With cloud-based software, enterprises do not have to spend time setting up servers and procuring licenses. Thus, various vendors in this market are offering cloud-based procurement software to cater to the growing demand from various end-users. Such factors will increase the demand for this segment during the forecast period.
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The cloud segment was valued at USD 3.79 billion in 2017 and continued to grow until 2021. Cloud-based software does not require the actual installation of hardware and software at the enterprise premises. It is maintained at the vendor's data center, from where it can be accessed by the enterprises on a subscription basis. Enterprises pay a monthly or yearly subscription fee for each device, including maintenance and system upgrades. Thus, the cloud-based model is very useful for small and mid-sized enterprises as it allows them to streamline and automate their daily operations efficiently, reduce errors, and lower their costs. Such factors will increase the segment growth in this market during the forecast period.
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North America is estimated to contribute 37% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. North America is a key region of the global market in terms of market share, with a strong presence of key players and a large consumer base. Digitalization and technological innovation have advanced significantly in this region, contributing to the growth of the global market. Increasing demand for automation, increasing adoption of cloud-based solutions, and the need for efficient supply chain management are some of the key factors driving the growth of the North American market.
The market is experiencing robust growth, driven by a confluence of factors and emerging trends. One significant driver is the increasing adoption of cloud-based solutions and Software as a Service (SaaS) models, exemplified by offerings such as Basware’s Purchase-to-Pay Solution and Oracle’s Cloud Self-Service Procurement. These solutions offer greater flexibility, scalability, and cost-effectiveness, enabling organizations to streamline their processes and adapt to changing business needs more efficiently. Additionally, the integration of artificial intelligence (AI) into procurement software, as seen in Zycus’s Procurement Software Suite, is revolutionizing the industry by automating routine tasks, enhancing decision-making, and providing valuable insights into supplier performance and market trends.
Furthermore, the growing demand for AP automation, driven by the need to improve efficiency and reduce manual errors, is propelling the market forward. SAP SE’s SAP Ariba Buying and Invoicing Software, with its advanced automation capabilities, is at the forefront of this trend. Moreover, as companies increasingly prioritize transparency, compliance, and risk management in their processes, there is a rising demand for solutions that offer cloud-based Supplier Qualification Management and Procurement Contracts. These solutions, exemplified by Cloud Supplier Qualification Management and Cloud Procurement Contracts, provide organizations with the tools they need to ensure supplier compliance, mitigate risks, and maintain transparent information throughout the lifecycle. Overall, as businesses continue to digitize and optimize their operations, the market is poised for significant growth and innovation in the coming years.
Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Enhancements in business efficiency stand out as pivotal drivers propelling the market forward. With procurement analysis spanning various facets of the process, organizations reap manifold benefits, including enhanced supplier management facilitated by comprehensive data oversight. Furthermore, these solutions aid in pinpointing business risks and trends, expediting the management and planning of intricate contracts and projects. Through the consolidation of information and the provision of insights from diverse data reservoirs, organizations garner dependable analytics, fostering informed decision-making. By streamlining supplier information management, these solutions bolster supplier engagement, amplifying efficiency while mitigating risks. Process automation coupled with heightened visibility and accuracy not only optimizes operations but also augments overall business efficiency. As a result, heightened demand driven by these efficiency-enhancing capabilities is anticipated to fuel substantial growth within the global procurement software market in the foreseeable future.
Growing demand for e-procurement is the primary trend in the global market. Electronic procurement (e-procurement) is the process of buying and selling services and goods electronically, primarily over the Internet. It replaces the manual process. Businesses choose these platforms because they help reduce additional costs, such as intermediary costs and irregularities in the process. Additionally, the e-procurement portal is designed to allow end-users to register as supplier or buyers, submit all relevant and required documents online, and participate in the subsequent bidding process. This leads to the generation of a large amount of data.
Predictive analytics uses this data to make predictions, which will enable enterprises to make appropriate strategies for business decisions. In addition, procurement software with e-procurement will enable enterprises to identify qualified vendors and forecast demand based on historical patterns, thereby increasing efficiency and predictability. Hence, increased use of e-procurement will fuel the demand, which is expected to fuel the growth of the global procurement market during the forecast period.
Complexity regarding integration with existing systems and supplier onboarding is a major challenge to the growth of the global market. The challenge lies in the fact that each company has its own systems and suppliers, making it difficult to integrate software with all of them seamlessly. One of the main concerns is the complexity of compatibility issues. Existing systems may be using outdated technology, causing challenges when trying to install the latest procurement software. This issue requires changes to existing systems and further complicates the integration process.
Additionally, suppliers may have varying levels of technological capabilities. Some may not have the necessary resources or knowledge to integrate with a new software. This can lead to delays in onboarding suppliers, which can be a significant problem for organizations. Thus, such factors are expected to hinder the growth of the market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Basware Corp.: The company offers procurement software, namely Basware e-Procurement. The company is involved in offering the services of procure to pay solutions, AP automation, e-procurement, and addition services such as supplier management, working capital, and payments.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The market is witnessing rapid evolution driven by various factors and emerging technologies. Solutions like Oracle’s Cloud Self Service Procurement and eProcurement Software are revolutionizing traditional procurement processes through digitization and automation. Cloud Sourcing and Procure-to-Pay Suite are catering to the diverse needs of SMEs and large enterprises across industries such as retail, manufacturing, IT, oil & gas, and more. With the integration of Machine Learning, Robotic Process Automation, and blockchain technology, procurement software is enhancing supply chain planning, streamlining spending, and eliminating duplication of records. Despite challenges related to infrastructure and quality, recent developments like GEP SMART procurement software and CommBox AI omnichannel solution are expanding market scope and offering significant opportunities for brands to improve customer experiences and operational efficiency.
The Global Procurement Software Market encompasses a wide scope, driven by various factors such as funding and opportunities in Machine Learning (ML), Robotic Process Automation (RPA), and the Internet of Things (IoT). This market caters to diverse sectors including small & medium-sized enterprises, retail & e-commerce, manufacturing & automotive, IT & telecom, and energy & utilities. On-Cloud solutions play a significant role in enabling company-wise production capacity optimization, addressing major factors in the procurement process automation. While opportunities abound in this market, there are also restraints and challenges associated with transitioning from traditional and conventional systems to more advanced solutions. Customers across industries, including companies like Cheniere Energy Inc., are increasingly recognizing the value of procurement software in enhancing operational efficiency and cost-effectiveness. As such, the Global Procurement Software Market continues to evolve to meet the evolving needs of businesses worldwide.
Procurement Software Market Scope |
|
Report Coverage |
Details |
Page number |
176 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 10.2% |
Market growth 2023-2027 |
USD 4.90 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
9.42 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 37% |
Key countries |
US, China, India, UK, and Germany |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Basware Corp., BirchStreet Systems Inc., Coupa Software Inc., Elcom System Ltd., Enaviya Information Technology Pvt. Ltd., Epicor Software Corp., Ginni Systems Ltd., Infor Inc., International Business Machines Corp., Ivalua Inc., JAGGAER LLC, Microsoft Corp., NB Ventures Inc., Oracle Corp., ORO Labs Inc., SAP SE, ScienceSoft USA Corp., SunSmart Technologies Pvt. Ltd., SutiSoft Inc., Tata Consultancy Services Ltd., Tropic Technologies Inc., Workday Inc., and Zycus Inc. |
Market dynamics |
Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Deployment
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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