Procurement-as-a-Service (PaaS) Market Expected to Reach $20 Billion by 2031—Allied Market Research

According to a new report published by Allied Market Research, titled, “Procurement-as-a-Service (PaaS) Market," The procurement-as-a-service market size was valued at $6.2 billion in 2021, and is estimated to reach $20 billion by 2031, growing at a CAGR of 12.5% from 2022 to 2031.

Procurement-as-a-service (PaaS) offers advanced tools for inventory and procurement management to business enterprises. Furthermore, procurement-as-a-service (PaaS) can provide a systematic strategy for optimizing the output of a company’s supply chain network in order to achieve peak performance.

The growth in market competition and the demand for work from home & remote working policies during the period of the COVID-19 pandemic aided in propelling the growth of the global remote and automated solutions such as procurement solutions and services during the period, hence empowering the demand for procurement-as-a-service industry. Moreover, the sudden economic imbalance and supply chain challenges during the period positively impacted the need for procurement-as-a-service industry. However, data privacy and sharing risks associated with third-party procurement as service vendors can hamper the procurement-as-a-service market forecast. On the contrary, the integration of advanced tools such as machine learning and data analytics with procurement management suite is expected to offer remunerative opportunities for expansion of the procurement-as-a-service market size during the forecast period.

The procurement-as-a-service market is segmented on the basis of component, organization size, industry vertical, and region. On the basis of component, the industry is divided into strategic sourcing, spend management, process management, category management, contract management, and transaction management. Based on organization size, the market is bifurcated into large enterprises and small and medium enterprises. The industry vertical covered in the study include BFSI, manufacturing, retail, IT and telecom, healthcare, and others. Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Governments and businesses have implemented work from home or are shifting work to employees in less affected areas to maintain business continuity during the pandemic. However, the situation has accelerated the adoption of advanced technologies such as artificial intelligence (AI), automation, and virtualization to control costs while improving the customer experience. Moreover, there is a surge in demand for online shopping, which has led to the need for food & beverage, manufacturing, and logistics companies to invest more in the automation of supply chains. For instance, as per the different studies in 2020, there has been around a 28% increase in online purchases across the globe, which is mainly driven by the pandemic. In addition, there is around a 60% increase in the trend of buying online and picking up service from the store. More number of companies are investing in procurement-as-a-service (PaaS) solutions during the pandemic. For instance, in July 2020, Honeywell conducted a survey that confirmed that the company is focusing on investing in warehouse execution software, with around 48% of respondents confirming it. Such investments drive the growth of the procurement-as-a-service industry.

KEY FINDINGS OF THE STUDY

• By organization size, the large enterprises segment accounted for the largest procurement-as-a-service market share in 2021.
• By region, North America generated the highest revenue in 2021.
• By industry vertical, the manufacturing segment generated the highest revenue in 2021.

The key players profiled in the procurement-as-a-service market analysis are Accenture, Plc, Aegis One Consults Ltd, CA Technologies, Capgemini, Corbus India LLP, F-code, Genpact, HCL Technologies Limited, IBM Corporation, Infosys Limited, Proxima Group, TATA Consultancy Services, Wipro, WNS Global, X Changing Solutions, GEP, Simfoni Limited. These players have adopted various strategies to increase their market penetration and strengthen their position in the procurement-as-a-service industry.