Negotiation Brief: Human Resources Software

Categories : Procurement Stages | Negotiate | Develop Business Requirements | Identify Suppliers | Set Strategy Published on : Jun 05 2018

By: ProcurementIQ Analyst, Cindy Du

Strategic Questions for Choosing the Right Supplier

Due to the growing number of businesses and rising worker turnover rates, companies have had to devote more time to employee-related administrative tasks, such as recruitment tracking, employee scheduling, worker performance evaluations, benefits administration and payroll management. As a result, the demand for human resource (HR) software has risen during the past three years and is expected to continue growing. More businesses are implementing HR software, as administrators seek software solutions to automate administrative tasks and improve work accuracy and efficiency. With the adoption of HR software on the rise, ProcurementIQ estimates that market vendors will generate close to $6.0 billion in total revenue in 2018.

HR-Software-Market-Characteristics


Although there are about 300 suppliers in the HR software market, it is highly concentrated. The four largest vendors, SAP, Oracle, Microsoft and Intuit, account for over half of the market’s revenue. Furthermore, market share concentration has been rising due to several mergers and acquisitions in the past three years. As large providers increasingly acquire smaller vendors, buyers will have fewer suppliers to choose from. Therefore, buyers will need assistance when negotiating with HR software vendors.

Below is a list of key questions that ProcurementIQ recommends buyers ask when choosing between HR Software providers:





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