Global Vendor Risk Management Market Size, Share, Analysis And Forecast To 2031

(MENAFN- Straits Research) Introduction

The global vendor risk management market was valued at USD 7.26 billion in 2021 and is projected to reach USD 25.96 billion by 2030, registering a CAGR of 15.21% f rom 2022 to 2030.

The market for vendor risk management is a method for regulating, identifying, monitoring, and assessing a variety of potential risks. These included operational risk, compliance risk, strategic risk, and several information security risks. All of these dangers can result from enterprises' partnerships with third parties.

Market Dynamics Need for the efficient management of complex vendor ecosystems

Organizations invest a substantial amount of time and energy evaluating the vendors who provide products and services that meet their business needs. Vendor risk management systems decrease the time and effort required to determine the essential factors of vendor performance and to score suppliers based on their product or service delivery, timeliness, and quality. When a business is reliant on several vendors, vendor risk management solutions aid in determining and recognizing the important issues associated with sourcing goods and services from third-party vendors. Managing various vendors is a laborious chore for any organization, but a vendor risk management solution simplifies the enterprise's evaluation of the risks associated with different vendors by providing a comprehensive risk assessment.

A significant section of the worldwide market continues to rely on manual methods to evaluate and estimate vendor dependency risks. Many organizations have not yet recognized the need for vendor risk management systems to evaluate their vendors' performance. These firms are hesitant to implement software for vendor risk management in their systems. Numerous firms rely on manual methods to detect hazards and are oblivious to the significance of vendor risk management solutions and services in mitigating vendor risks.

To ensure the on-time delivery of products and services to consumers, large enterprises frequently rely on a multitude of suppliers for business continuity and supply chain process support. To handle such crucial difficulties, it is necessary to assess the numerous challenges and dangers posed by suppliers. Solutions for vendor risk management prioritize each risk and streamline the risk-resolution processes inside an organization. In addition, these technologies simplify the businesses' efforts to minimize risks while analyzing and selecting a vendor for particular activities.

Regional analysis of the global vendor risk management market

The market is split by region into North America, Europe, Asia-Pacific, and LAMEA.

North America is predicted to dominate the global vendor risk management market.

Advanced technical breakthroughs in AI, machine learning, cloud, and IoT, growth of end-user sectors such as BFSI, healthcare, and others, increasing investments, and a growing emphasis on data security are driving the vendor risk management market in the area.

In January 2019, a third-party vendor misconfigured a server where Ascension kept digital versions of paper financial documents, causing a data leak at numerous US banks and financial firms. One could access a database with 24 million credit records containing client data.

Rapid Ratings International Inc., a provider of vendor risk management solutions, rated 284 U.S. industrial enterprises that failed or filed for bankruptcy between 2014 and 2018. Poor financial health suppliers have a higher possibility of poor performance and insolvency. 95% of the 37 U.S. industrial enterprises that failed in 2018 had a "High Risk" or "Very High Risk" FHR.

Walmart and Amazon, among others, have global supply chains in the region. Thus, vendor risk management players can infiltrate the region by using AI and machine learning.

Key Highlights

• The global vendor risk management market was valued at USD 7.26 billion in 2021 and is projected to reach USD 25.96 billion by 2030, registering a CAGR of 15.21% from 2022 to 2030.
• BFSI is expected to witness significant growth during the forecasted period
• North America held the largest share of the market in 2021 and is expected to do the same during the forecasted period.