Top 10: Predictions for 2025
Procurement stands at the heart of business operations, driving value and efficiency across global supply chains.
As we approach the coming year, the field faces a landscape rich with both opportunities and challenges that require careful strategic consideration.
Strategic planning in procurement is far more than a routine task; it's a critical lever for maintaining a competitive edge in an ever-evolving business environment.
From leveraging advanced AI technologies to championing sustainable sourcing practices, procurement teams have the opportunity to revolutionise their approach to value creation and risk management.
Here, Procurement Magazine consults with industry experts to explore the trends they believe will be pivotal for procurement success in 2025.
10. Managing changing markets & globalisation
By 2025, changing markets and globalisation will significantly impact procurement.
Customisation has become a consumer expectation, pressuring manufacturers to adapt their procurement strategies.
In the US alone, consumers are spending nearly US$60bn in on-demand services such as online marketplaces and transportation.
The rise of personalised products and on-demand services may push companies to localise their supply chains, moving away from global networks to regional and local ones. This shift aims to meet custom demands and faster delivery times while tapping into new markets, including base-of-the-pyramid populations.
Mass customisation allows for diverse, personalised products without increasing costs, thanks to advanced technology, but effective procurement management and market analysis are crucial for businesses to meet these contemporary demands efficiently
9. The struggle to find young talent continues
Acquiring the right talent is the most important key to growth. Hiring was—and still is—the most important thing we do.
Procurement is grappling with a tough challenge: attracting and retaining young talent essential for future growth and innovation.
According to the Chartered Institute of Procurement & Supply (CIPS), only 49% of professionals actively chose procurement as a career last year, highlighting the struggle to engage new talent.
With Baby Boomers retiring and Gen Z not yet filling entry-level roles, competition for talent is fierce. Gen Z workers, who prioritize flexibility and dynamic career pathways, are digital natives eager to adopt new technologies.
To succeed, procurement must promote purpose, embrace technology and create an environment that appeals to this next generation.
8. Putting the value in value creation
Procurement teams are stepping into a transformative role, no longer just cost-cutters but key drivers of strategic value.
In 2025, the focus will pivot from traditional cost savings to creating sustainable, long-term value through AI and sustainability integration.
"AI-enabled insights can improve operational efficiency while highlighting the inherent value of human expertise," asserts Melanie Nuce-Hilton, SVP of Community Engagement at GS1 US.
Shifting from tactical purchasing to strategic sourcing unlocks better results, fostering supplier partnerships for innovation, quality and on-time delivery. Plus, with total cost of ownership (TCO) in play, procurement decisions can consider the full lifecycle, ensuring both immediate savings and enduring growth.
7. Procurement's importance grows internally
Procurement teams have considerable work to do to ensure that their voice is heard and applied clearly across the business.
As procurement continues to embrace digital transformation and AI, it is crucial for these teams to align their insights with the needs of various stakeholders.
This alignment will further build trust and confidence within the C-suite, ensuring that procurement remains a key player in achieving our long-term organisational goals.
Procurement is stepping into the spotlight, according to 'Across the Procurement-Verse: Changing Trends in the Procurement Function,' a study by SAP and Economist Impact.
Surveying 2,307 C-suite executives across industries, it highlights how external pressures are transforming procurement into a strategic powerhouse.
Gone are the days of operating in silos and focusing solely on supply chain policies. Procurement now collaborates across departments, driving organisational goals and influencing business strategy.
This evolution is boosting its clout in long-term planning. As expectations rise, procurement’s role is reshaped, breaking barriers and delivering greater value to modern enterprises.
6. Geopolitical instability cements risk management as priority
Global supply chains are shifting toward resilience and nearshoring, as highlighted by Melanie Nuce-Hilton of GS1 US.
"While global sourcing remains a key feature of modern supply chains, its vulnerabilities have accelerated the need for building resilience and the push toward nearshoring—bringing manufacturing and sourcing closer to home," she says.
Effective risk management is the backbone of procurement, safeguarding continuity, finances and reputation. By proactively tackling risks, procurement teams strengthen supplier relationships, ensure compliance and optimise operations. This approach delivers informed decisions, cost efficiency and timely goods and services, bolstering competitiveness.
Looking to the year ahead, "businesses are not only responding to ongoing global disruptions," Melanie asserts "but also preparing for potential changes in US trade policies stemming from the 2024 election results."
5. Preparing for labour migration
With more than 240 million global migrants and internal migration surging, companies face both challenges and opportunities to uphold rights.
Global supply chains drive economic progress but often perpetuate human rights abuses like unsafe work, forced labour and land seizures, according to the UN Working Group on Business and Human Rights.
Migrants are particularly vulnerable to labour abuses due to a range of factors including language barriers as well as a lack of clear training and HR support.
In 2025, we expect this number to rise - something procurement teams need to look out for when sourcing their suppliers.
4. Resource scarcity increases, further establishing ESG goals
The warehouse and logistics sector must champion a sustainable energy future by sourcing a resilient and renewable energy system, helping businesses navigate energy crises and price swings.
“As we look ahead, more companies will future-proof infrastructure to tackle energy challenges and meet sustainability goals,” Maria Torrent March of Iron Mountain predicts.
Sustainable supply chains cut waste, reduce costs and strengthen reputations through ethical practices - plus there's correlation between ESG investment and profitability: DP World revealed earlier this year 82% of its report respondents say that embracing sustainability has improved their organisation's financial performance.
3. Pressure for transparency rises
Supplier intelligence should be top of mind for organisations in 2025.
As global supply chains become more complex, organisations need a clear, comprehensive understanding of their suppliers to mitigate risks, ensure resilience and maintain a competitive edge. Supplier intelligence—encompassing both supplier diversity and sustainability data—provides this critical visibility.
Transparent procurement and supply chain management have become pivotal as organisations navigate increasingly complex global markets. With mounting regulatory pressures, consumer expectations and technological capabilities, businesses must prioritise visibility across their sourcing strategies.
Transparency mitigates operational risks, enhances brand reputation and demonstrates ethical commitment.
By leveraging advanced digital technologies and comprehensive data analytics, companies can now track supply chain processes with unprecedented granularity.
As we progress into 2025, transparency is no longer a competitive advantage but a fundamental business imperative.
2. New generation brings automation, digitisation & tech disruption
A new generation of procurement professionals is revolutionising procurement through automation, digitisation and technological disruption.
Tom Perrone, SVP Global Professional Services at project44, believes: “2025 will be a transformative year for the supply chain – not just through the implementation of disruptive technologies, but also through new business models driven by a new generation of supply chain leaders."
Gen AI-powered tools are automating supplier selection, contract management and data analysis, improving efficiency and reducing errors.
Procurement processes are being streamlined through cloud-based platforms, e-procurement tools and online purchasing systems.
1. AI: Transitioning from a playful tool to full integration
Integrating AI into procurement isn't just a technical upgrade; it’s a game-changer for modern businesses.
By automating repetitive tasks, AI frees teams to focus on strategy and innovation. It processes vast data at lightning speed, delivering real-time insights that drive smarter decisions and cost efficiencies.
Supplier management gets a boost too—AI optimises contracts, fosters strong relationship and identifies risks like fraud or instability.
Scalable and adaptable, it empowers procurement teams to forecast demand, negotiate better deals and process invoices swiftly, ultimately boosting productivity and performance.
"In 2024, AI evolved from holding a Bachelor's degree to earning a PhD. Despite this, many CPOs are still sitting on the sidelines," notes Keith Hausmann, Globality’s Chief Customer Officer.
But change is imminent: "In 2025, this hesitation will end."
A Gartner survey echoes this, showing 72% of procurement leaders prioritising AI, with transformative impacts on decision-making and innovation.
"That elevation has been a long time coming," Keith concludes.
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