Procurement Budgets, Staffing, and Process Metrics 2025/2026

How much are organizations budgeting for their procurement function, and how many procurement professionals do they require? What is the allocation of procurement resources by job function and types of procurement, and what is the split between internal and external personnel (outsourced or in shared services centers)? How is the procurement budget allocated? What are the key performance metrics for the procurement function? To answer these questions, and others, we provide our Procurement Budgets, Staffing, and Process Metrics study. For a full description, read more below.  

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Chapter 1: Executive Summary (Free Download)
Chapter 2: Composite Benchmarks
Chapter 3A: Mid-Large Size Organizations
Chapter 3B: Very Large Size Organizations
Chapter 4: Banking and Finance
Chapter 5: Energy and Utilities
Chapter 6: Healthcare Payors
Chapter 7: Healthcare Provider
Chapter 8: Insurance
Chapter 9: Life Sciences
Chapter 10: Discrete Manufacturing
Chapter 11: Process Manufacturing
Chapter 12: Media and Information Services
Chapter 13: Professional/Tech Services (Other than IT)
Chapter 14: Retail
Chapter 15: Transportation and Logistics

INTENDED AUDIENCE

For Chief Procurement Officers, procurement professionals, and consulting firms, this study provides key metrics and unbiased data for benchmarking your organization’s procurement function, with a focus on indirect procurement budgets and staffing levels and key performance metrics. This study will allow you to achieve the following outcomes: 

• Benchmark your procurement budget levels. Compare them with those of organizations in your industry sector. 
• Manage your procurement staffing levels, including internal staffing as well as external staff—those within business process outsourcing (BPO) providers or in shared services units. A variety of staff productivity metrics are provided (see below) 
• Evaluate your procurement key performance indicators (KPIs). These allow you to compare the performance of your procurement organization against your industry peers.  

For business process outsourcing (BPO) providers, this study provides valuable insights into the current procurement budget and staffing metrics, giving up-to-date insights into the market landscape. It also provides insights into the current use of external procurement personnel for various job positions.  

KEY METRICS DESCRIPTIONS

Each chapter begins with an introduction, presenting the key findings.

Section 1: Demographics 

We provide a description of the demographics of the chapter’s survey sample. These include organization-size demographics, including organization revenue, SG&A spending levels, number of employees, and revenue per employee.  

We continue with procurement demographics, including total procurement staff member head count and total purchase orders per year.  

Section 2: Budget Metrics 

This section looks at the annual budget for the indirect procurement function. In other words, we examine how much organizations spend to operate their indirect procurement operations. The section comprises the following metrics: 

• Procurement Operations Budget as a Percentage of Revenue 
• Procurement Operations Budget as a Percentage of SG&A 
• Procurement Budget by Line Item 
• Percent of Technology Budget Spent on AI 
• AI Service Provider Engagement Models 
• Indirect Procurement Budget by Line Item 

Section 3: Indirect Procurement Spend Metrics 

In this section, we provide benchmarks for indirect procurement spend, that is, how much organizations spend for indirect material and services. In this section, we include all indirect procurement spending, whether it is processed by internal or external procurement personnel. It includes the following metrics: 

• Indirect Spend in USD 
• Indirect Spend per Day 
• Indirect Spend as a Percentage of Revenue 
• Indirect Spend as a Percentage of SG&A 
• Indirect Spend per Indirect Procurement FTE 
• Non-Addressable Indirect Spend as a Percentage of Total Indirect Spend 
• Non-Sourceable Indirect Spend as a Percentage of Total Indirect Spend 
• Managed Indirect Spend as a Percentage of Total Indirect Spend 
• Indirect Procurement Spend by Type 
• Indirect Procurement Spend by Category 

Section 4: Procurement Staffing Metrics 

This section provides typical staffing levels for the procurement function. This includes internal staff, which includes contingency workers, and external staff, which includes procurement personnel in global capability centers (GCCs) or shared services centers, outsourcing service provider personnel serving the procurement function, or residing in other departments. These levels are described using the following metrics: 

• Internal and External Procurement Staff as a Percentage of Total Procurement Staff 
• Indirect and Direct Procurement Staff as a Percentage of Total Procurement Staff 
• Direct Procurement Staff Allocated to Internal and External Personnel 
• Indirect Procurement Staff Allocated to Internal and External Personnel 
• Contingency Workers as a Percentage of Internal Indirect Procurement Staff 
• Indirect Procurement Staff by Type of Procurement 
• Indirect Procurement Staff by Job Function 

Section 5: Procurement AI Impact 

In this section, we provide benchmarks to evaluate the impact AI has had and is anticipated to have on procurement. These are: 

• Impact of AI on Internal, External, Direct, and Indirect Procurement FTEs 
• Projected AI Impact on Internal, External, Direct, and Indirect Procurement FTEs 

Section 6: Procurement Organization Key Performance Metrics 

In this section, we provide benchmarks to evaluate the key performance metrics of the procurement function, with a focus on indirect procurement. These are: 

• Direct Purchase Orders as a Percentage of Total POs 
• Indirect Purchase Orders as a Percentage of Total POs 
• Annual Percentage of Indirect POs Processed by Internal and External Procurement Personnel 
• Total Purchase Orders per Procurement FTE 
• Direct Purchase Orders per Direct Procurement Staff Member 
• Purchase Orders per Indirect Procurement Staff Member 
• Indirect PO Size in Dollars 
• Days Payable Outstanding 
• Percentage of Purchase Orders Processed Electronically 
• Procurement Cycle Time (Requisition to Delivery) 
• Purchase Order-to-Delivery Lead Time 
• Percentage of Orders Delivered On-Time and In-Full 
• Average Organizations Tracking Supply Chain Carbon Footprint for Suppliers 
• Procurement Spend Sourced from Sustainable Suppliers 
• Cost Reduction as a Percentage of Managed Indirect Spend 
• Cost Avoidance as a Percentage of Managed Indirect Spend 

Section 7: Procurement Technology Trends 

This section provides an overview of procurement technology implemented to support the procurement processes of an organization. It covers the following:  

• Top 10 Procurement Systems 
• Top 5 Contract Lifecycle Management Systems 
• Top 5 Industry-Specific or Niche Procurement Tools 
• Percentage of Procurement Transactions Conducted through E-Procurement Tools 
• Percentage of Procurement Personnel (Direct and Indirect) per Procurement Tech Specialist 
• Percentage of Procurement Tech Specialists by Organizational Unit 

APPENDIX 

The Appendix includes common terms and definitions used in our annual survey and in this study. It also includes a detailed definition for all procurement spending categories and staffing categories. The Appendix concludes with a brief discussion on the statistics used in this study. 

• Common Terms and Definitions 
• Procurement Budget Categories 
• How We Define Procurement Job Functions 
• Statistical Notes 

CHAPTER DESCRIPTIONS

Chapter 1: Executive Summary (Free Download) 

This chapter provides an overview of the key findings from the full study and describes the contents of the subsequent chapters. It also includes information on the study participants and the survey methodology.  

• Introduction 

• Key Findings 

• Overview of the Study Contents 

Chapter 2: Composite Metrics 

This chapter provides composite metrics for all survey respondents across all sectors and organization sizes. The sample includes 303 organizations and is stratified by size and sector as described in the section on survey methodology. Respondents must have at least $500 million in annual revenue. There is no upper limit on the revenue of survey respondents. 

Chapter 3A and 3B: Benchmarks by Organization Size 

In these chapters, we provide a complete set of benchmarks for organizations within the specified size classification. Benchmarks for midsize and large organizations are in Chapter 3A and for very large organizations in Chapter 3B. There are 155 respondents in the midsize and large organization sample and 148 in the very large organizations sample. We define the size categories as follows: 

• Midsize and large organizations have annual revenue of more than $500 million up to $5 billion. 

• Very large organizations have annual revenue of $5 billion and above. 

Chapter 4: Banking and Finance Sector Benchmarks 

Chapter 4 provides comprehensive benchmarks for procurement staffing and spending within the banking and financial services sector. This sector encompasses a wide array of organizations, including commercial banks, investment banks, credit unions, mortgage lenders, consumer finance lenders, and other financial services providers. The 37 respondents from this sector vary in size, ranging from companies with annual sales of approximately $200 million to those exceeding $40 billion. 

Chapter 5: Energy and Utilities Sector Benchmarks 

Chapter 5 offers an in-depth analysis of procurement staffing and spending within the energy and utilities sector. This sector is characterized by a diverse range of organizations, including power generation companies, electric and gas utilities, water and sewage companies, and renewable energy providers. The survey sample includes 35 respondents from this sector, with annual revenues as low as $500 million to those exceeding $30 billion. 

Chapter 6: Healthcare Payor Sector Benchmarks 

Chapter 6 provides a detailed analysis of the healthcare payor sector, focusing on benchmarks for procurement staffing and spending. The sector includes a range of organizations such as health insurance companies, managed care organizations, government programs, and other entities that manage healthcare costs. The chapter examines data from 32 respondents, revealing a substantial variation in company sizes, with annual sales ranging from approximately $600 million to over $50 billion. 

Chapter 7: Healthcare Provider Sector Benchmarks 

Chapter 7 provides comprehensive benchmarks for procurement staffing and spending within the healthcare provider industry. This sector includes a diverse array of organizations, such as hospitals, healthcare networks, clinics, long-term care facilities, outpatient care centers, and other healthcare service providers. The 36 respondents from this sector vary significantly in size, with annual revenues ranging from approximately $400 million to over $175 billion. 

Chapter 8: Insurance Sector Benchmarks 

Chapter 8 provides comprehensive benchmarks for procurement staffing and spending within the insurance industry. This sector covers a wide spectrum of organizations, including life insurance, health insurance, property and casualty insurance, reinsurance providers, and specialized insurance carriers. The 15 respondents from this sector vary in size, ranging from companies with annual sales of approximately $900 million to those exceeding $50 billion. 

Chapter 9: Life Sciences Sector Benchmarks 

Chapter 9 offers a comprehensive examination of the life sciences sector, presenting benchmarks for procurement staffing and spending that reflect the industry’s unique characteristics. The sector includes a diverse array of organizations, such as biotechnology firms, pharmaceutical companies, medical device companies, and research institutions. The 34 survey respondents vary in size, with organizations reporting annual revenues ranging from approximately $400 million to over $50 billion, highlighting the sector’s broad economic impact. 

Chapter 10: Discrete Manufacturing Sector Benchmarks 

Chapter 10 provides comprehensive benchmarks for procurement staffing and spending within the discrete manufacturing industry. This sector encompasses a wide array of organizations, including automotive manufacturers, aerospace and defense companies, electronics producers, machinery manufacturers, and other producers of distinct products. The 25 respondents from this sector vary in size, ranging from companies with annual sales of approximately $600 million to those exceeding $120 billion. 

Chapter 11: Process Manufacturing Sector Benchmarks 

Chapter 11 provides comprehensive benchmarks for procurement staffing and spending within the process manufacturing industry. This sector encompasses a wide array of organizations, including chemical producers, food and beverage manufacturers, pharmaceutical companies, and oil and gas refineries. The 29 respondents from this sector vary in size, with annual sales ranging from approximately $600 million to over $20 billion. 

Chapter 12: Media and Information Services Sector Benchmarks 

Chapter 12 provides comprehensive benchmarks for procurement staffing and spending within the media and information services industry. This sector includes a diverse set of organizations such as publishing houses, broadcasting companies, digital media platforms, advertising agencies, market research firms, and information service providers. The 15 respondents from this sector vary in size, ranging from companies with annual sales of approximately $600 million to those exceeding $29 billion. 

Chapter 13: Professional/Tech Services (Other than IT) Sector Benchmarks 

Chapter 13 provides comprehensive benchmarks for procurement staffing and spending within the professional/tech services industry (other than IT). This sector covers consulting firms, engaging services, accounting and audit firms, architectural services, and other specialized professional practices. The 15 respondents from this sector vary in size, ranging from companies with annual sales of approximately $750 million to those exceeding $65 billion. 

Chapter 14: Retail Sector Benchmarks 

Chapter 14 provides comprehensive benchmarks for procurement of staffing and spending within the retail industry. This sector includes grocery chains, department stores, specialty retailers, e-commerce platforms, and mass merchandise companies. The 15 respondents from this sector vary in size, ranging from companies with annual sales of approximately $300 million to those exceeding $95 billion. 

Chapter 15: Transportation and Logistics Sector Benchmarks 

Chapter 15 provides comprehensive benchmarks for procurement staffing and spending within the transportation and logistics industry. This sector includes freight and shipping companies, airlines, rail operators, trucking firms, warehouse providers, and third-party logistics (3PL) service providers. The 15 respondents from this sector vary in size, ranging from companies with annual sales of approximately $500 million to those exceeding $20 billion. 

PROCUREMENT BENCHMARKING

Avasant Research not only publishes business process metrics. We also provide custom benchmarking services for clients. 

Looking for expert assistance in evaluating your procurement budgets, staffing, and key performance metrics? Our custom benchmarking consulting service provides an in-depth assessment of your procurement key metrics against our database of peer organizations. 

Contact us for pricing and a free sample of the benchmarking deliverable.