Web-Based Procurement Doubles Each Year, Says IDC
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According to research company IDC, Web-based procurement more than doubles in size each year, with a compound annual growth rate of 105 per cent.
Worldwide, the Internet commerce procurement applications market topped $147 million in 1998, and is expected to reach $5 billion by 2003.
Most significant of IDC's findings is the fact that web-based procurement is very much more cost-effective than conventional methods. Projected savings from Internet commerce procurement will top $103 billion on transactions totalling $1.375 trillion by 2003, says the firm.
"More and more businesses are beginning to understand Internet commerce procurement applications can deliver tangible results to their bottom line, lowering costs while boosting overall efficiency and maybe even stock value," said Albert Pang, manager of IDC's eCommerce Software research program.
In the United States, Visio, a Seattle-based software vendor, reported a reduction in order processing costs from $113 per purchase order to $6, after installing a web-based procurement system a year ago.
As for the number of users of Internet commerce procurement applications: they will skyrocket from 600,000 in 1999 to 250 million by 2003, says IDC.
In fact, it all "bodes very well for the market," according to IDC's estimations. After this week's stories of the Web "shrinking" -- as a result of people browsing favourite sites rather than exploring further -- IDC's reminder of the web's other dimensions is very timely.