GEP Trend Report: Strategic Sourcing and Procurement Outlook 2015

GEP, in its report entitled, GEP Trend Report: Strategic Sourcing and Procurement Outlook 2015, shares “key global economic and business trends that will shape and drive procurement strategies in 2015 and beyond.” The first section identifies these key trends along with implications and potential strategies: Falling Oil Prices; Economic Slowdown and Regional Geo-politics; Climate Change and Sustainability; Speed of Delivery Value; and E-Commerce and Data Security.

The second half of the report focuses on these category trends (with directly quoted highlights):

Information Technology – Global enterprise spend on cloud-based services (approaching $100MM) continues to increase at a rapid rate of 20-25 percent, five to six times the rate of the total IT spend. By 2018, it is predicted that public, cloud-based software, server and storage spending will account for more than 50 percent of the total IT spend.

Telecom – The U.S. wireless market continues to grow as more users acquire smartphones (80 percent) and add/increase data into their plans.

Business Travel – Spending on business travel will remain consistent or slightly increase in 2015 compared with 2014. An uptick in travel volumes may be fueled by the general economic growth, and the perception of travel pricing improvements coming from downward trends in fuel pricing.

Maintenance, Repair & Operations (MRO) – The MRO market in North America will be relatively volatile in 2015, calling for a proactive and disciplined strategic sourcing and category management approach. Primary trends in the MRO market that will fuel this volatility are: Falling oil Prices, Volatility in the commodities market, and Continued consolidation in the MRO distribution industry.

HR Services – In the future, both HR and procurement will not only collaborate to analyze the cost effectiveness and quality of certain products or services, but together, they will also assess whether these products or services fit into the enterprise’s existing HR structure.

Energy & Utilities – Governments and enterprises worldwide are being impacted by the relatively sudden and unexpected decline of oil prices. Importing economies, manufacturing industries and consumers will enjoy the benefits of lower oil prices while exporting economies and producer and oil support service industries will face severe challenges.

Packaging – The packaging industry in 2015 will be shaped by several key dynamics – global supply & demand, operational efficiency (capacity utilization and automation) and raw material prices (pulp, paper, paperboard, chemicals).

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