Procurement BPO Market Moves Forward with Notable Pick-up in the Number of Comprehensive...

FRAMINGHAM, Mass. -- According to a recent IDC study, the procurement business process outsourcing (BPO) market is quickly moving beyond "newcomer" status after a notable pick-up in activity in 2004. In the last year, the market experienced a 73% increase in the number of comprehensive

"2004 saw a significant expansion in procurement BPO activity," said Romala Ravi, director for IDC's BPO Services research. "Companies are moving beyond discrete outsourcing to adopt more comprehensive engagements that span multiple procurement sub-processes and commodities. Yet, the market continues to be in early adopter phase, and vendors face a steep learning curve that presents both opportunities and challenges."

While the manufacturing industry currently claims the majority of procurement BPO deals and will continue to lead adoption, additional verticals poised for procurement BPO adoption include financial services and utilities. From a worldwide perspective, although the Americas as a region has the greatest number of absolute engagements, the Europe, Middle East, and Africa (EMEA) region holds the lion's share of procurement BPO spending, driven by the comprehensive deals signed in the region over the past year.

Ravi adds, "2005 will be a year of validation for this market as explicit results come in from early comprehensive deals. Customers, prospective buyers, vendors, new entrants, and the financial community will all be watching closely as the execution phase of early deals unfolds and early results trickle in."

The IDC study, Worldwide and U.S. Procurement BPO 2005-2009 Forecast (IDC #33036) presents the annual update to the five-year forecast for the worldwide market for procurement BPO services. The document identifies and quantifies the effects of recent trends and events influencing the procurement BPO services opportunity through 2004 and the five-year forecast. In addition, the document analyzes key demand and supply trends influencing the timing and magnitude of the market opportunities, and offers recommendations for service providers to improve service mixes and competitive positioning.

To purchase this document, call IDC's Sales hotline at 508-988-7988 or email sales@idc.com.

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