Procurement in 2025: Trends to Watch Out For

With 2025 around the corner, procurement is again stepping into the spotlight as CEOs and senior executives continue to zero in on improving their operations. For businesses across the US, there has never been a better time to review their current procurement strategies–not only to trim overhead costs but also to look for key market trends, boost profit margins, and remain competitive in a constantly evolving landscape.

According to a survey by Gartner, only 14% of procurement leaders have adequate talent to meet the future needs of their function. That is a severe concern if you have not been on your business supply chain management.

Expense to Profit provides insight to business executives on how to improve their bottom line without sacrificing efficiency. One critical aspect to examine is your procurement strategies.

These days, procurement is no longer just about getting goods and services at the lowest cost; it is about more innovative sourcing, embracing technology, and building resilient supply chains. This article explores the critical procurement trends 2025, helping you understand what to expect and how to take advantage of the situation. What should you look out for?

AI Integration

Over the last few years, artificial intelligence has undoubtedly played a significant role in revolutionizing our daily lives. It has diverse applications in virtually every sector of commerce—sales, bookkeeping, and even procurement.

According to Statista, global revenues from the AI software market are expected to hit $126 billion next year. This is a clear indication that the industry is attracting significant investment across several sectors. When it comes down to specifics, a report suggests that 57% of companies are experiencing significant improvements in risk management based on insights from different technologies, such as advanced analytics, automated workflows, and machine learning/AI.

Adopting AI systems for procurement efficiency is a trend that should not be ignored. If you have considered adding these systems, this is a friendly reminder.

Sustainable and Ethical Sourcing

Environmental, social, and governance (ESG) factors increasingly influence procurement. According to Investors, 11 to 15% of US investment managers will put 40% of their portfolios in ESG investments.

69% of employees aged between 18 and 34 also express this sentiment, wanting their companies to invest in sustainability efforts, including reducing waste, using renewable energy, and reducing carbon. More and more businesses are reviewing and adopting green procurement practices to ensure that ethical standards are met and to improve reputation and compliance.

Supplier Relationship Management

In 2025, Supplier Relationship Management (SRM) is emerging as another crucial trend that will shift procurement from a transactional, cost-focused process to a strategic partnership model.

According to a report, businesses spend between 15 to 27% of their revenues on external suppliers. Yet, a considerable chunk of the negotiated value is lost over the contract’s duration. When companies and suppliers move beyond a purely transactional relationship, they open the door to collaboration on product development, process improvements, and innovative solutions.

For instance, suppliers tend to have a unique understanding of their industry. Tapping into this knowledge can help your business develop better products, reduce costs, or create new offerings that give them a competitive edge.

Cybersecurity in Procurement

Cybersecurity has become a top priority for businesses worldwide as digital transformation continues to reshape procurement. In 2025, the stakes are higher than ever as data breaches, ransomware attacks, and supply chain vulnerabilities pose significant risks. These can lead to operational disruptions, financial loss, and damage to a company’s reputation.

This year, the global average data breach cost was $4.88 million, a 10% increase from the previous year. The number of data breaches increased by 200% between 2013 and 2022. For procurement teams handling sensitive information—such as supplier contracts, pricing details, and transaction records—cybersecurity is critical to safeguarding the integrity of supply chains and maintaining trust with partners.

To stay ahead of sophisticated cyber threats, your procurement team should look to explore advanced security technologies, including artificial intelligence and blockchain. AI-driven cybersecurity tools help detect unusual behavior and potential threats in real time, allowing businesses to respond quickly to suspicious activity.

Focus on Cost Savings and Value Creation

Another trend you should take advantage of next year is focusing on value-based contracts that go beyond merely reducing expenses. Focusing on sustainable cost management can drive consistent savings while enhancing supplier relationships and fostering innovation.

Procurement professionals adopt value-based contracting models, prioritizing long-term outcomes over short-term savings. These contracts focus on total cost of ownership (TCO) and encompass quality, supplier reliability, and lifecycle costs.

Once again, collaborating with suppliers can allow your team to explore new product ideas, improve current processes, and find efficiencies that will drive growth for both parties.

Conclusion

Procurement is set to be a critical driver of cost savings and strategic value in 2025. Reviewing trends and adopting the strategies above will position your business for profitability while contributing to its long-term goals.

At Expense to Profit, we are here to help you unlock the full potential of your procurement function. As a proven consultancy, we specialize in increasing business revenue by identifying and reducing unnecessary daily and monthly expenses.

Our expertise in cost optimization has helped numerous businesses maximize their resources and achieve operational excellence. We believe we can help your business, too, by enhancing your cost savings and driving sustained value across your operations.

Reach out to us, and let us partner with you to transform your procurement into a powerful driver of profit and growth.