I wanted to share a few early snippets from our forthcoming market landscape on Supplier Management BPO services, which is due to hit the shelves next month. We’ve defined this market as managed strategic sourcing and procure-to-pay services, the bulk of which are indirect procurement services, but also includes some direct strategic sourcing and supplier management analytics processes.
And we can exclusively reveal here, that the market surpassed a billion dollars in expenditure for the first time last year with a 30% hike in expenditure on new multi-scope BPO contracts:
So what’s driving this growth?
Major shift of indirect procurement work to India. The labor arbitrage is enabling new contracts to be set up with limited upfront costs as a result of the lower cost labor. Several new contracts have been implemented with immediate cost-reduction in some cases, where the service provider has streamlined the costs over the course of the contract.
