Eighty-four percent of procurement leaders believe a recession is already underway or imminent by the end of 2025, according to the 2025 AI in Procurement Index released by Fairmarkit.
“Procurement isn’t just behind the curve – it’s being outmaneuvered by the very vendors they’re negotiating with. AI isn’t a ‘future opportunity’ for suppliers anymore. It’s standard practice,” says Kevin Frechette, CEO at Fairmarkit. “As recession fears loom and supplier sophistication rises, procurement can no longer afford to treat AI as a back-burner initiative. Those that act now can seize a competitive edge through faster operations, smarter negotiations, and more strategic decision-making.”
Key takeaways:
● The majority (94%) of procurement leaders say their suppliers are already using AI in negotiations. While supplier adoption of AI soars, 43% of procurement leaders worry about relying on inaccurate or incomplete AI-generated data, and 39% fear AI could lock them into unfavorable deals in fast-moving negotiations. These concerns often stem from teams turning to rogue tools, rather than strategically adopting reliable solutions built for procurement.
● 84% of procurement leaders say a recession is already happening or will hit by the end of 2025. As cost pressures intensify and supply chains remain unpredictable, leaders are turning to AI to stay ahead. Managing budgets (45%) and ongoing disruptions (34%) are top obstacles in recession planning, and ones AI can help navigate by improving speed, precision, and visibility across sourcing decisions.
● 91% of organizations have an executive mandate to adopt AI, but obstacles remain that are slowing progress on AI adoption. The top barriers to AI adoption as cited by procurement leaders are data privacy and security concerns (64%), resistance to change (57%), governance roadblocks (55%), internal policies limiting who can use AI tools (54%), and high implementation costs (56%). Additionally, 52% of procurement leaders say their teams don’t fully understand how to use GenAI tools effectively.
● Rather than replacing jobs, AI is reshaping them, and the nature of the work itself. Forty-four percent of procurement leaders expect their teams to grow as a result of GenAI adoption, and only 5% anticipate reductions. Sixty-nine percent of organizations are investing in AI training, and 67% are hiring AI talent to close capability gaps. The most in-demand skills? Data interpretation (82%), strategic decision-making (75%), and cross-functional collaboration (69%).
