Inefficient indirect procurement costs buyers thousands of hours

A joint study by Unite and the Leipzig University of Applied Sciences (HTWK) shows: Indirect procurement in European organizations remains resource-intensive, insufficiently digitized, and increasingly at odds with rising ESG expectations.

 The study is titled "Managing indirect procurement: Success factors for performance and cost control".

The study conducted by HTWK combines independent research with the practical experience of the platform company Unite in procurement transformation. The evaluation of responses from 181 specialists and executives from European procurement organizations makes it clear: Indirect procurement ties up significant resources - from purchasing, through supplier management to transaction processes. However, targeted transformation can help: Increase efficiency, strengthen compliance, reduce costs.

"The study confirms what we have observed in practice for years: Indirect procurement suffers from fragmented systems and inefficient processes," says Prof. Dr. Holger Müller, professor of supply chain management at HTWK Leipzig and lead scientist of the study. "Future-proof procurement requires data transparency, standardized processes, and digital support - especially for companies that must meet increasing ESG and compliance requirements."

Need for digitalization recognized, but hesitant in implementation

The study results provide well-founded insights into how indirect procurement is managed and where the biggest challenges lie. Performance is evaluated across five key areas: process efficiency, ESG integration, decision criteria, cost drivers, and digital maturity.

Many procurement teams recognize the need for action, but there is still hesitation in implementing digital solutions. Almost half of the companies surveyed manage their indirect procurement with fewer than five dedicated employees - and this with expenditures in the tens of millions and growing demands for sustainability and compliance. Manual processes are widespread: 40 percent still rely on non-specialized tools like Excel for complex tasks in procurement and supplier management.

Digital maturity as a lever for ESG and efficiency

The study shows: where digital processes are advanced, ESG implementation is also more successful. Companies with integrated procurement systems are significantly more likely to have a clear ESG strategy.

Key insights at a glance:

• Only 15 percent of companies have fully digital and integrated procurement processes.

• In 65 percent of these digitally integrated companies, a defined ESG strategy is already established.

• The use of electronic marketplaces reduces procurement efforts on average by one third - a clear indication of the automation effect and more efficient processes.

• These marketplaces are in use, but rarely central: 65 percent of companies use them selectively, only 22 percent trust them as the main channel. This shows: A large part of the digital potential remains unused so far.

Innovative solutions are gaining momentum

In addition to digital maturity, the study focuses on the growing interest in procurement-as-a-service (PraaS) and AI-supported procurement - innovative levers for increasing efficiency in indirect material procurement. Despite varying degrees of use, both approaches have great potential to relieve labor-intensive processes and significantly improve decision-making processes.

“PraaS is a strategic enabler in times of permacrisis,” says Christel Constant, board member at Unite. “By shifting routine processes to specialized platforms, procurement managers can remain agile and insight-driven, aligning with compliance and ESG goals. With a central reference source for indirect procurement data

 companies can gain timely insights and respond more quickly to dynamic demands.”

Strategic action areas for procurement

Based on the data, the study highlights the key levers that companies can use to increase their efficiency and significantly reduce the complexity of indirect procurement:

1. Invest in digital integration to minimize manual effort and enable real-time collaboration across procurement, supplier management, and transaction processes.

2. Use digital tools strategically to support ESG goals - especially in monitoring compliance and embedding sustainability in daily decisions.

3. Increase transparency in effort and cost drivers through intelligent use of procurement data, uncover inefficiencies, and convincingly justify automation.

4. Examine new solutions such as AI and procurement-as-a-service (PraaS) - levers with great potential to reduce operational effort and significantly increase agility, especially in larger and digitally advanced organizations.