Global Supply Chain Stewardship Spend Will Nearly Double in the Next Five Years
The first-half of 2016 has revived attention towards product and supply chain stewardship. The European Commission, for example, formally adopted the EU Circular Economy Action Plan effective from 2016 to 2025 with ambitious resource reduction goals such as recycling 55% of plastic and 60% of wood. The UK Modern Slavery Act and the France Private Bill 501 both require large multinational firms of certain sizes to increase transparency on supply chain human rights track records beginning in 2016. Similarly, NGOs and advocacy groups have increased pressures on corporate supply chain performance; witness The Walk Free Foundation launching the inaugural 2016 Global Slavery Index which estimates that over half of slave labor is located in Bangladesh, China, India, Pakistan or Uzbekistan.
Recent Verdantix research on the market evolution of supply chain stewardship has found that global investments will nearly double from $369 million in 2016 to $648 million by 2021 (see infographic below). The top three drivers influencing corporate investments are European regulations, B2B procurement evaluations, and circular economy initiatives that bolster resource conservation efforts. Unsurprisingly, the fast growth has led to an influx of diverse providers. On the software side, our research has identified five main firm categories: 1. EH&S and GRC firms, 2. Product stewardship firms, 3. Sustainability specialists, 4. Supply chain information management firms, and 5. Collaborative platforms.
In June 2016, Verdantix conducted a renewed investigation into the global market for sustainability services. Our updated research finds that the global spend on sustainability consulting services for supply chain and resource management services will grow from $227 million in 2016 to $313 million in 2021 at 7% CAGR. In addition, global spend on assurance and verification services for supply chain and supplier sustainability data will grow from $21 million in 2016 to $24 million in 2021 at a 3% CAGR. To gain a better understanding on the supply chain stewardship market, download our market forecast study report here.