Procurement KPIs, or Key Performance Indicators, are an important tool used in the business world to measure performance and achieve organizational objectives. In particular, they are used to measure the success of a company’s procurement processes, such as the costs and time associated with purchasing, sourcing, and supplier management.

According to McKinsey, Procurement KPIs include measures such as cost savings, competitive bidding, supplier performance, supplier collaboration, supplier onboarding, and strategic procurement. Cost savings can be measured by analyzing the cost of raw materials, supplies, and services and comparing it to any discounts or cost reductions a company receives from suppliers.

Another important KPI is competitive bidding, which measures how successful a company is in finding the most competitive prices for their purchases. Supplier performance is also essential to measure, as it can reveal how well a company is delivering its good and services.