GVR Report cover Retail Sourcing And Procurement Market Size, Share & Trends Report

Retail Sourcing And Procurement Market Size, Share & Trends Analysis Report By Solution type, By Service Type (implementation, consulting, training & support), By Deployment Type, By End-use Type, And Segment Forecasts, 2018 - 2025

  • Report ID: GVR-2-68038-005-7
  • Number of Pages: 135
  • Format: Electronic (PDF)
  • Historical Range: 2014 - 2016
  • Industry: Technology

Report Overview

The global Retail Sourcing and Procurement market size was estimated at USD 2,748.7 million in 2016. Globally increasing adoption of the solutions by various retail businesses is anticipated to be the growth factor of the industry over the forecast period. Moreover, the emergence of the internet of things, cloud technology, and big data is the key factor to boost the implementation of the solutions within the businesses.

U.S. Retail Sourcing & Procurement market

With continuous development in mobile and online shopping behavior causing substantial disruption in the retail landscape, market pressure such as volatility of fuel prices and increasing raw material costs are adding to the daily challenges faced by retailers. All these challenges pose a continuous threat to the profit margins. While the main strategies of retail organizations are presently aligned towards advanced planning and quality assurance to ensure enhanced customer satisfaction, there is a pressing need for executing strategies for improved purchasing and decision making.

Procurement practices are in place ever since the beginning of business practices. However, the evolution of technology sourcing practices has significantly changed the scenario. The strategic purchasing software helps enterprises housed to trace and procure goods in quick time, most efficiently, maximize saving, as well as evaluate and keep track of the future business transaction and supplier performance. Thus, the adoption of such technologies within the business is anticipated to propel the industry growth in the future.

The automation in procurement activities is observed during the last few years and is likely to continue owing to the high adoption of mobile applications and supporting tracking and procurement processes. Moreover, technological adoption in retail sourcing and procurement solutions and software is leading to increased competition in the retail sector owing to the low barrier for small niche organizations to enter into the industry and growing online purchasing and tracking services due to geographic proximity.

To sustain the market position with progressing technological advancement, large retail enterprises poses opportunities to become retail industry infrastructure providers owing to the high demand for store operations and inventory management in the coming years The demand for enhanced visibility in tracking related data, centralized procurement processes, and improved collaboration between retails and suppliers is anticipated to augment the market over the forecast period. Furthermore, the industry is likely to grow as end-users are becoming more knowledgeable about resources and product choices flourishing rapidly due to globalization. However, reluctance to adopt new technology and inappropriate management is hindering the growth of the market. The adoption of procurement and sourcing processes by apparel and food and beverages are further projected to augment the market over the forecast period.

Widening impact of the indirect tax such as customs duties, revenue recognition, and VAT in countries requires consideration. On the other hand, obtaining goods from a range of countries and switching suppliers from one nation to another involves more flexible tracking systems. These factors have encouraged the adoption of advanced sourcing and procurement tools and techniques among retailers to collaborate between back, middle, and front ends of business and broaden customer experience.

Solution Insights

Strategic sourcing emerged as the largest sourcing and procurement solution segment while accounting for around 21% of the overall volume in 2016. The ability of strategic sourcing to consolidate the purchasing power of the retail business to secure the best value obtainable in the marketplace is the prime factor that is likely to develop its market soon. Additionally, it helps in increasing efficiencies by formalizing the method of gathering, analyzing, and factoring of spend information into the procurement process.

It plays a vital role in the competitiveness and cost structure of small and large businesses. Strategic sourcing involves developing long-term partnerships and analyzing high-volume purchases with a select group of suppliers capable of offering quality services and products with low costs. Retail businesses with high-volume purchases are likely to implement strategic sourcing solutions owing to its significant impact on lowering cost structures.

Spend Analysis emerged as the second-largest solution category and accounted for over 16% of the total revenue in 2016. The rising awareness of potential savings within the organization in the European and Asia Pacific region to be the key driving factor for the growth of spend analysis solution in the next eight years. A spend tool facilitates transparency into spend, facilitating category managers to search for new saving opportunities. It also allocates free time for purchasing staff which can be used to include more categories under competitive sourcing. Moreover, spend analysis also ensures compliance savings, that helps to manage the supplier portfolio with preferred contract suppliers.

Service Insights

The global demand for retail sourcing and procurement has seen a paradigm shift owing to the automated and cloud-based procurement and sourcing solutions available to retailers. Consulting services emerged as the largest service segment and accounted for over 39% of the total market revenue in 2016. Retail purchasing is quickly evolving in response to advancements and changes in technology, hiring, and personnel requirements, business practices, and consumer demands and concerns. Big data will become a larger part of procurement and will assist in simplifying procurement decisions, form processes, and select suitable procurement solutions. Moreover, artificial intelligence and big data together will revolutionize the overall efficiency and speed of sourcing and procurement processes.

U.S., Canada, and Europe are anticipated to account for the largest share for solutions due to better network infrastructure, and digital penetration in logistics and support. Consulting services emerged as the largest segment in the regions and was accounted for about 38% in the year 2016. Major companies including SAP SE, IBM Corporation, Oracle, SciQuest, and others facilitate expertise solution with their range of consultancy portfolio that helps businesses to assess trends and current practices as well as achieve value-added results into their operations. Also, various companies facilitate market intelligence solutions in spend analysis, strategic sourcing, supplier relationship management, and industry benchmarking to provide a holistic view of expenses for future spend-management.

Deployment Insights

Within the deployment segment, on-premise emerged as the largest segment and accounted for over 41% of the total revenue in 2016. With the rise in the popularity of running software at remote locations, on-premise procurement software is gaining high market share globally. However, due to high investment in time and money is hindering the growth among small and medium-sized businesses.

Cloud-based procurement and sourcing software is poised to have the largest CAGR of 12.1% between the forecast period 2017 to 2025. The procurement cloud helps to streamline the source-to-pay process through social collaboration and automation, thus, achieving high margins by controlling costs. Additionally, cloud-based software supports seamless accessibility without additional IT effort to the device. With timely upgrades and maintenance made in the cloud-based procurement software, the segment is likely to experience the highest growth in the coming years.

Many enterprises currently pursue a contemporary tracking strategy, i.e. set up shared service centers along with engaging in business and IT processes to third party providers. Many of them manage their external and internal sourcing engagements with the help of a hybrid tracing strategy owing to its enhanced performance, reduced overheads in internal sourcing functions, and better relationships with the external vendors. Moreover, a hybrid sourcing strategy has transformed the internal sourcing function into a proficient sourcing unit, thus, feeding the growth of the segment among retailers.

End-user Insights

The small & medium enterprise segment occupied the largest market share, accounting with 51% of market share in 2016 and is anticipated to emerge as the fastest-growing segment with a CAGR of 11.7% from 2017 to 2025. The rising demand for product availability and timely delivery has been pressurizing small & medium enterprises to meet the demand along with maintaining the same margin levels. The sourcing and procurement solutions help enterprises in sourcing, inventory, contracting, and other purchasing related activities, and precisely reflect updates made in any process or region across an organization.

Global Retail Sourcing & Procurement market

Retail procurement and sourcing is a business function that has a significant and direct impact on the bottom-line performance of the enterprise. These techniques enable more informed and detailed status to the end-users, compared to other solutions available in the industry. The rising adoption of these solutions in electronics, food and beverages, and manufacturing suppliers is likely to augment the growth of the market during the next eight years.

Regional Insights

North America was the leading market and accounted for around 33% of the total market revenue in 2016. Increasing adoption of automation in procurement and sourcing processes and constant technological advancements in the fields of analytics, cloud, and BYOD (Bring Your Own Device) trends in the region is expected to have significant growth for the market in the next eight years.

Asia Pacific is projected to grow with a substantial CAGR of 12.9% within the forecast period owing to an exponential growth of retail businesses in the last few years. Emerging economies such as India, China, and Japan have been experiencing strong economic growth. Also, a growing technology user base and rapidly developing infrastructure are responsible for driving the industry.

Key Companies & Market Share Insights

The global Retail Sourcing and Procurement market is highly competitive and fairly concentrated, with the top four companies accounting for the maximum share of the global production in 2016. Key market participants include SAP SE, Oracle, IBM Corporation, and SciQuest. The market players are using strategies such as collaboration, acquisition, and new product development and launches to strengthen their position in the market.

Application development and customized software are expected to be a key parameter for being competitive in this market, with frequent mergers and acquisitions being undertaken as an attempt to diversify the product portfolio and gain market share. Amazon, the world’s largest retailer purchased Whole Foods Market, a grocery chain worth USD 13.7 billion, to make a remarkable expansion in its business.

Retail Sourcing And Procurement Market Report Scope

Report Attribute


The market size value in 2020

USD 4.1 billion

The revenue forecast in 2025

USD 7.3 billion

Growth Rate

CAGR of 11.5% from 2017 to 2025

The base year for estimation


Historical data

2014 - 2016

Forecast period

2016 - 2022

Quantitative units

Revenue in USD million/billion and CAGR from 2017 to 2025

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Product, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico

Key companies profiled

IBM Corporation; SAP SE; Oracle Corporation

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the report

This report forecasts revenue growth at global, regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For this study, Grand View Research has segmented the global Retail Sourcing and Procurement market based on product and region:

  • Solution Outlook (Revenue, USD Million, 2014 - 2025)

    • Strategic sourcing

    • Supplier management

    • Contract management

    • Procure-to-pay

    • Spend Analysis

  • Service Outlook (Revenue, USD Million, 2014 - 2025)

    • Implementation

    • Consulting

    • Training & Support

  • Deployment Outlook (Revenue, USD Million, 2014 - 2025)

    • On-premise

    • Hybrid

    • Cloud

  • End-use Outlook (Revenue, USD Million, 2014 - 2025)

    • Small & Medium Enterprise (SME)

    • Large Enterprise

  • Regional Outlook (Revenue, USD Million, 2014 - 2025)

    • North America

      • The U.S.

      • Canada

    • Europe

      • UK

      • Germany

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

      • Mexico

    • Middle East & Africa

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