Employee Benefits Procurement Insights – Future Outlook and Strategies

Do you know, Zest’s recent research reveals a significant trend: nearly half of all employers, accounting for 48%, have reported an uptick in their investments towards enhancing their benefits packages within the past year, a strategic maneuver prompted by the dynamic shifts in the economic landscape. This insightful research brings to light the formidable challenges confronting businesses amid today’s fiercely competitive job market, with a substantial 42% of enterprises contending with recruitment obstacles.

The intensifying competition for talent has cast a shadow of concern over a notable portion of employers, with more than a third—specifically 36%—expressing apprehension about their capacity to keep pace with rivals’ salary escalations. This palpable worry stems from a fear of falling short in both attracting and retaining the right talent, underscoring the pivotal role of comprehensive benefits packages in the ever-evolving realm of talent acquisition and retention strategies.

Employee Benefits – Procurement Intelligence

The employee benefits sector is poised for significant growth, projected to achieve a Compound Annual Growth Rate (CAGR) of 4.5% from 2023 to 2030. Leading the charge is North America, commanding the lion’s share of this thriving category. The surge in competition among employers to both attract and retain top-tier talent, coupled with a heightened emphasis on fostering work-life equilibrium among staff, is propelling this expansion.

Order your copy of the Employee Benefits Procurement Intelligence Report, 2023 – 2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis

Major players in the corporate realm are deploying a diverse array of tactics to capitalize on this momentum. These strategies encompass everything from strategic mergers and acquisitions to forging key alliances and contracts, as well as the continual innovation and rollout of novel products and services. An exemplar instance occurred in August 2023 when TA Associates and Warburg Pincus, in their bid to fortify their position as premier providers of digital employee benefits solutions across Europe, acquired Epassi Group, a prominent player in the employee benefits arena.

One prevalent benefit offered by companies is the provision of lunch and breakfast coupons, facilitating easy access to meal packages for employees. Consequently, there is a burgeoning demand for employee meal cards, driven by this particular facet. Moreover, with the escalating trend of job-hopping, there’s an uptick in the need for amenities like meal cards and comprehensive employee benefits schemes. This burgeoning demand is underpinned by these solutions’ demonstrated capacity to elevate staff productivity and morale, thereby bolstering overall retention rates. As firms increasingly prioritize such perks to bolster the well-being of their workforce in response to mounting attrition rates, the demand for these services is poised to intensify further.

Companies are continuously focusing on collaborating or commencing their own services. For instance,

• In June 2023, with the purchase of Benefits, an employee benefits advisory firm, together with the company’s brokerage and consulting operations, Aon announced the development of the firm’s Health Solutions capabilities in Chile. The acquisition considerably increases Aon’s client base and the services already being offered by the company in Chile.
• In June 2023, Willis Towers Watson announced a partnership with Clyde & Co. To assist customers in navigating the fast-changing climate risk and liability landscape, the collaboration will employ the organizations’ experience and in-depth knowledge of critical climate concerns.
• In April 2023, Mercer announced BT Super’s integration into the Mercer Super Trust. Additionally, Mercer disclosed that it had acquired Advance Asset Management Limited, further enhancing its position as Australia’s top investment multi-manager and growing its retirement offerings.
• In August 2021, Up Group purchased Leeto to improve its offerings by adding a complementary digital service to its current offerings, including a platform that enables employees to access their benefits.

List of Key Suppliers

• Aon Hewitt
• Mercer
• Fidelity
• Met Life Inc.
• Aetna Inc.
• ACS
• Wills Tower Watson
• Marsh & McLennan Companies, Inc.
• Gallagher
• Axa S.A. 

Browse through Grand View Research’s collection of procurement intelligence studies:

• Payroll Outsourcing Services Procurement Intelligence Report, 2023 – 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)
• Legal Services Procurement Intelligence Report, 2023 – 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape) 

Employee Benefits Procurement Intelligence Report Scope

• Employee Benefits Category Growth Rate : CAGR of 4.5% from 2023 to 2030
• Pricing Growth Outlook : 10% – 12% (annual)
• Pricing Models : Value-based pricing model, fixed-fee pricing model, per-employee per month pricing model
• Supplier Selection Scope : Cost and pricing, past engagements, productivity, geographical presence
• Supplier Selection Criteria : Customization & flexibility, work benefits, financial benefits, health-related benefits, lifestyle-related benefits, employee experience, service, support, technical expertise, security measures, cost and value, support and maintenance, regulatory compliance, and others
• Report Coverage : Revenue forecast, supplier ranking, supplier positioning matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model 

Brief about Pipeline by Grand View Research:

A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions. 

Our services include (not limited to):

• Market Intelligence involving – market size and forecast, growth factors, and driving trends
• Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
• Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
• Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions