08-Mar-2023 | Zion Market Research
The global spend analysis software market size was worth around USD 1835 Million in 2022 and is predicted to grow to around USD 4000 Million by 2030 with a compound annual growth rate (CAGR) of roughly 10.25% between 2023 and 2030
Spend analysis software is a technology-driven tool used to study organizations’ purchase data, the outputs of which can later be used in strategic decisions for company growth. It is a stepping stone toward achieving greater cost-effectiveness since the program allows real-time and transparent information about company buying expenses. A standard spend analysis software should contain certain features like spend categories, where spending data based on different categories can be put in an effective way. The categories can range from vendor, labor, suppliers, material, and other types.
A segment to classify and normalize suppliers so that it becomes easy to understand all information related to a certain supplier. Procure record feature entails tracking of key order information like purchase quantity, delivery timeframes, payment terms & cost, and items of services purchased. A software analysis will work most efficiently till the time it provides real-time analytics. In case the output is delayed, the company will not receive any sort of benefit and it is important for the software to deliver key results in real time. Any software runs on machine learning and artificial intelligence to provide excellent and error-free data.
Some of the benefits of using spend analysis software is building a spend cube that measures spending habits in three dimensions, that are: suppliers, corporate business units, and item categories. It can also assist in strategic sourcing based on data thus resulting in better savings. Utilizing software to extract information reduced cycle time to perform any function resulting in higher optimization of company resources thus propelling the need for spend analysis systems.
Covid-19 had a drastic impact on the global spend analysis software market cap. Since the virus brought along extremely volatile situations for businesses across the globe, there was a shift toward finding more ways that could help companies cut any unnecessary or extra costs and help them save money and monetary resources.
The global spend analysis software market is expected to grow because of the rising number of business-to-business transactions due to globalization. The market value of B2B sales is the rapidly growing availability of information in digital forms. With the help of technologies like the Electronic data interchange (EDI), B2B transactions have become more efficient which has also propelled the growing realization trend of interdependence between businesses for sustainable growth.
The global b2b market was around USD 6.64 trillion in 2020 while it may grow at a CAGR of over 15% in the next five years. With such explosive growth, there is a growing necessity to digitize as much information as possible not just from a security point of view but from a company’s strategic evaluation of future growth prospects as well. Since spend analysis software allows a company to store information while at the same time analyzing its spending habits, it becomes easier for the management to understand even the slightest extra cost that can be eliminated thus saving the company millions over a period of time. These systems enable time effectiveness as well since complex data can be analyzed with the click of a button.
The data security concerns may restrict the spend analysis software industry growth. The customized services are expected to provide ample global market growth opportunities. The hesitant end-users toward technology adoption are projected to challenge the global market expansion
The global spend analysis software market is segmented based on business function, organization size, analytics type, industry, and region.
Based on business function, the global market segments are procurement, finance, marketing, and information technology. The global market is dominated by the procurement function since essentially the software deals with procurement-related data and helps firms decide on cost reduction. An average of 10% cost reduction is expected by deploying analysis software in procurement functions.
Based on organization size, the spend analysis software industry is segmented into small and medium enterprises (SMEs) and large enterprises. As per the 2020 report by Small Business Trends, around 67% of small businesses spend around USD 10,000 annually on analytics.
Based on analytics type, the global market is divided into decisive, predictive, and prescriptive. The predictive analysis segment led the global market in 2021 since it helps in leveraging profit and revenue. The predictive analysis market was over USD 7 billion on 2019
Based on industry, the spend analysis software industry segments are retail & e-commerce, manufacturing, telecommunication & IT, energy and utilities, and BFSI. Retails has the highest number of applications of spend analysis software. Generally, the average gross profit margin in retail is over 50% which can be increased further with the aid of spend analysis software.
The global spend analysis software market may witness Asia-Pacific growing at the highest CAGR during the forecast period. The regional growth is anticipated to be propelled by the rising adoption of spend analysis systems across industries and organization sizes. India has over 49.9 million small and medium enterprises and is one of the largest markets for SMEs. The high CAGR is also driven by the emergence of many local players in the market offering quality services at affordable prices. Regions like India, China, Japan, Singapore, and Taiwan have managed to become hubs for information technology (IT) whose services are used by multinational firms as well. The intensive efforts undertaken by the governments to encourage such growth are projected to aid regional market expansion. North America may also generate high revenues aided by the already advanced infrastructure of the regions as well as private and government initiatives to upgrade the systems.
This review is based on a report by Zion Market Research, titled “Spend Analysis Software Market By Business Function (Procurement, Finance, Marketing, and Information Technology (IT)), By Analytics Type (Descriptive, Predictive, and Prescriptive), By Organization Size (Small and Medium Enterprises (SMEs), and Large enterprises), By Industry (Retail and E-commerce, Manufacturing, Telecommunications & IT, Energy & utilities, and BFSI) and By Region - Global and Regional Industry Overview, Market Intelligence, Comprehensive Analysis, Historical Data, and Forecasts 2023 – 2030.”- Report at https://www.zionmarketresearch.com/report/spend-analysis-software-market
Some of the key players in the global spend analysis software market are:
By Business Function
By Analytics Type
By Organization Size
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