The Market for eProcurement Services Roars with Opportunity, IDC Says

FRAMINGHAM, MASS – DECEMBER 11, 2000 – The eprocurement services market is starting to make some noise. By the time 2004 rolls around, it will be roaring, with worldwide opportunity generated from set-up services, which are consulting, implementation, and ongoing management of deployed solutions, close to $13 billion. IDC believes vendors themselves could play a large part in determining just how much this market booms.

 

Value-added services and vendors’ creativity and flexibility to provide clients with a reasonably priced end-to-end procurement services solutions will determine the adoption rate of eprocurement,” said Nelly Zaharinov, a senior analyst with IDC's eProcurement Services research program.

According to IDC, implementation services with large companies will provide vendors with the most lucrative opportunities. Through 2004, revenues from these services will account for approximately 50% of the eprocurement set-up services market. Revenues from eprocurement consulting services will be the fastest growing, increasing at a compound annual growth rate (CAGR) of 62% from 1999 to 2004, compared with a 55% CAGR for the entire market.

IDC also expects the proportion of business-to-business eprocurement outsourcing services to increase substantially through 2004. In 1999, just 5% of B2B eprocurement services spending was on outsourcing. By 2004, this percentage will increase tenfold.

Medium-sized companies, and even some large ones, prefer not to make an up-front investment to acquire eprocurement applications and will choose eprocurement outsourcers instead,” Zaharinov said. IDC believes most of the market's activity in the near future will be generated by the eprocurement of indirect goods but expects eprocurement of direct goods to pick up considerably starting in 2002.

Information like the above can be found in IDC's new report eProcurement Services Market Forecast and Analysis, 1999-2004 (IDC #B22874). The report forecasts spending in the eprocurement set-up services and outsourcing markets and discusses major opportunities in the areas of set-up and value-added services. eProcurement services are defined. The report also carefully reviews the difference between eprocurement, emarketplaces, and edistribution. To purchase this report, contact Jim Nagle at 1-800-343-4952, extension 4549, or at jnagle@idc.com.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

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