30 Procurement Statistics to Inform Your 2024 Procurement Strategy

Procurement statistics are a procurement leader's best friend. This data should inform your procurement strategy for the year ahead.

Table of Content

• Procurement and GenAI Statistics
• Procurement Technology Statistics
• Top three priorities for CPO’s in 2024
• Supplier Management Statistics
• Sustainability and ESG

Procurement and GenAI Statistics

1. Recent analysis by The Hackett Group shows that Gen AI will reduce procurement costs by 47%.
2. 50% of organizations will support supplier contract negotiations through the use of Artificial Intelligence (AI) - enabled contract risk analysis and editing tools.
3. 67% of procurement leaders see spend analytics as one of the top 3 opportunity areas for generative AI in procurement.
4. Procurement leadership anticipates a 21.7% increase in productivity from the use of GenAI in the next year and a half.
5. 28% of procurement organizations have already adopted GenAI, primarily in pilot programs despite the relatively recent emergence of it.
6. Total addressable market for generative AI software to be $150 billion, compared with $685 billion for the global software industry.

Source: The Hackett Group

Procurement Technology Statistics

We have summarized the key benefits that procurement teams achieved through procurement software adoption as reported by The Hackett Group in a recent report.

1. 56% of companies have large-scale deployments of spend analytics tools.
2. There is a projected 14% year-on-year increase in spend analytics adoption for 2024​.
3. Organizations observed upto 60% improvement in spend visibility and spend management through their P2P platforms.
4. A significant 73% of transactions achieved touchless automation from requisition to purchase order (PO).
5. There was a 29% reduction in the cost per transaction from requisition to PO.
6. Companies achieved 92% PO compliance rate through procurement automation, which contributed to better spend control and overall cost efficiency.
7. Organizations with a typical $10-billion spend observed annual spend savings or avoidance of $35M-$45M, underscoring the financial benefits of adopting advanced P2P solutions.
8. Top-quartile organizations achieved a 28% reduction in cycle times, attributed to streamlined workflows and better process visibility, resulting in faster procurement cycles.
9. Top-performing organizations achieved an 83% first pass match rate for electronic invoices, which significantly improved accuracy and reduced processing times.
10. P2P solutions enabled 14% cost reduction by steering requesters to compliant purchase channels, leveraging preferred suppliers, and negotiated pricing.

Source: The Hackett Group

Top three priorities for CPO’s in 2024

1. Strategic sourcing and leveraging spend has been cited as the #1 priority by 56% of the procurement executives.
2. 52% of procurement leaders plan to focus on talent and skill development
3. Identifying and mitigating supplier risk has been cited by 38% of CPOs as a priority in 2024.

Source: Gartner

Supplier Management Statistics

The insights around supplier relationship are curated from the recent "Voice of the Supplier Survey 2024" by HICX.

1. Almost all of suppliers (98%) in the survey are looking for their biggest customers to communicate better.
2. 58% of suppliers agreed with the statement that their most important customer only cares about getting the best price from them.
3. Digital transformation and data management adds complexity where 31% of suppliers have to log into ten or more systems to do business with their most important customer.
4. 33% of suppliers believe that information needs to be easier to find (e.g. sustainability policies, compliance information).
5. 31% of suppliers want better service and support.
6. 44% of suppliers state that they are too stretched to volunteer new ideas, as an effect of relationships, processes full of friction, redundant data and information requests, and overall poor communications.

Communication is the top priority for suppliers

Source: HICX

Sustainability and ESG

1. 51% of organizations include sustainable procurement in dashboards reported to senior management.
2. Another study by Sedex reveals that, 40% of North American procurement leaders ignores sustainability.
3. There is a regional difference in sustainable procurement prioritization,
   • 79% of European
   • 77% of Asia-Pacific
   • only 33% in North America
4. 37% of procurement executives are unaware of sustainability-related legislation that impacts their businesses.
5. 63% of procurement respondents even acknowledged that meeting sustainability targets affects them directly by impacting their performance evaluations or compensation.