Procurement Statistics – 21 Key Figures of 2022
Professional procurement managers sometimes hate talking about procurement statistics. And you’ll soon find out why.
For this article, we are going to try to take procurement statistics at a different level. We will understand how the figures stand for this year 2022 and learn whether procurement will remain strong in the coming years and the next.
After this article, you’ll probably come to love procurement statistics. Or not.
What is Procurement Statistics?
Perhaps one of the reasons why procurement managers do not like talking about procurement statistics is because it’s a whole new world full of mysteries. And numbers. And the numbers game tends to be very boring, especially for procurement managers who are more familiar with the negotiations and sourcing part of procurement.
Simply put, procurement statistics, also known as procurement analytics, is the process of collecting and analyzing procurement data to form meaningful insights. It also helps in effective business decision-making.
Back in the day, it is very easy to talk about procurement statistics because everyone had to deal with it at some point. Back then, procurement managers need to learn how to read data and analytics about procurement and sourcing. Nowadays, it’s all changed though. Procurement teams can simply buy or invest in procurement programs that analyze all data in a matter of seconds. Suddenly, procurement data is transferred and analyzed in just a fraction of a second; try explaining or talking about that part of the process!
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The Definition of a Procurement System
One of the key factors to understanding procurement statistics is by studying the procurement system.
To put it in simple terms, a procurement system is a detailed and automated process of buying goods for the company. The procurement system is also responsible for maintaining the inventory system of the company. These days, it is a program designed and bought specifically to help the company in how it spends its budget for procurement as well as managing the supplies that were bought.
Some of the other processes that a procurement system takes care of automatically are as follows:
- Generating purchase orders
- Sending purchase requisitions
- Approving delivered services/goods
- Selecting/managing vendors
- Reviewing invoices
The E-Procurement System Debunked
The e-procurement system may look intimidating and too advanced to people who are not very good with computers and other technical stuff, but to be honest, it’s not. The e-procurement system is the same as most procurement systems; its main function is to assist the procurement manager in automating and making complex tasks that would normally take normal person days or even months to finish.
Most e-procurement systems have automated programming that allows them to do market research, sourcing tasks, and other data-relevant work that is important for the success of the procurement process. As such, it is now the job of the procurement manager or analyst to make sure that the company gets a good federal procurement data system that can really help with automating the procurement process while following important company standards.
There are many e-procurement systems available today. All you have to do is figure out which procurement system works for your procurement process!
The 21 Key Procurement Statistics Figures of 2022
1. Covid-19 had an unprecedented impact on supply chains in 2022, with disruptions hitting firms around the world. As a result, managing risk and resilience will continue to be just as important in the upcoming year.
2. The UK government’s own worst-case scenario estimated there could be 7,000 trucks queued in Kent trying to get across the Channel. As a result, procurement professionals will need to be ready, as there might be a steady increase in deliveries getting stalled in the future.
3. A growing proportion of the population is now in financial difficulty, putting pressure on price points. This economic shift, alongside the ongoing move to online and home delivery, will worsen retailers’ margin challenges, while they contend with the increased need to compete on price to retain sales.
4. Truck and van fleet owners will be doubling down on operational efficiency. That is to say, the focus will be on vehicle and driver efficiency. The business will need to be run to leaner degrees than ever before.
5. Failure of key suppliers could prevent organizations from delivering the products and services they need to customers, so they must provide transparency into when suppliers will be paid, and pay them on time to give them a fighting chance to survive
6. Environmental issues may not have been a priority for some firms in 2020, and research showed six in 10 UK businesses lowered investment in sustainability initiatives following the Covid-19 outbreak
7. Environmental pledges being made by countries around the world mean that green projects are likely to be pushed front and center by firms in 2021.
8. The geopolitical stage sustainability will be a major issue in 2021, with the Climate 21 Project in the US set to be backed by President-elect Joe Biden, and the UK pledging to wipe out its contribution to climate change by 2050.
9. As sustainability continues to be a focus, organizations need to ensure they are following green practices. Businesses must address supplier visibility issues and make sure they are putting the right tools in place to drive environmental change internally and beyond, empowering suppliers to do the same
10. Environmental concerns will once again be high on the agenda. Increased home deliveries in lockdown and fluctuating traffic levels have thrown a spotlight on businesses’ carbon emissions, meaning that finding ways to sustainably cut emissions, without compromising in areas such as service quality, will rightly be a key priority for many
11. This year’s UK government report on modern slavery found more than 10,000 potential victims were identified in the UK. And an indirect supplier of fashion retailer Boohoo was reportedly paying workers less than the minimum wage.
12. Organizations need to improve visibility into labor practices across their supply chain in 2021. This will help firms identify responsible practices for direct suppliers, but also for indirect tier two and three suppliers, reducing their risk
13. For decades, companies have focused on reducing their supply base and cost-cutting while streamlining the procurement strategy. But, with few suppliers and small inventories, many organizations simply couldn’t react swiftly or confidently enough during the pandemic. Instead, they ran out of stock and failed to meet customer demand.
14. A primary lesson learned in 2020 was that relying too heavily on a small number of vendors can be crippling. As a result, senior managers will continue to look hard at sourcing, purchasing, and inventory.
15. A renewed focus on supply chains will require procurement teams to rethink their fundamental role. They will need to consider more local options and a digital transformation strategy to detect risks and inform decision-making. The agility of procurement will become key to the organization’s success.
16. Companies still using paper-based acquisition and invoicing systems suffered greatly during the pandemic. If they couldn’t find their suppliers’ order records or contact details, even the smallest tremor of a problem could turn into an earthquake.
17. Pinpoint information on orders and digital tools for managing spend, including tail spend became vital for businesses plotting a course through lockdowns and supply-chain disruption.
18. In a post-pandemic world, digitization will become almost mandatory—a penny-ante that simply gets you a seat at the table. Digital transformation technologies will need to include more than just online purchasing portals.
19. Automation technology for reporting, artificial intelligence for analysis, and cloud-based record-keeping that can be accessed anywhere will all be must-have technologies going forward.
20. Experts believe a large part of de-risking a supply chain is diversifying providers. Geographic diversity is a vital method for protecting against logistical disruptions. But, also important is the range of partners on the roster.
21. Supplier diversity—adding minority- and women-owned businesses to your supplier base—has become crucial to a company’s ability to survive major disruptions.
What are procurement statistics?
Also known as procurement analytics, procurement statistics are data gathered for procurement usage.
What is procurement analytics?
Procurement analytics is the study and collection of data needed for a procurement process to work.
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