2012 Purchasing Card Benchmark Survey Results
Richard Palmer and Mahendra Gupta, RPMG Research Corporation

Survey Overview
The 2012 Purchasing Card Benchmark Survey Results (the Report ) provide a comprehensive analysis of the purchasing card market including trends, benchmark data, and variables that factor into program success.

Survey Respondents
The Report is based on over 4,300 responses from purchasing card end-users representing public and private corporations, state and federal government, city and county government, public and private universities and colleges, school districts, and more. All market sizes  small, middle, large, and Fortune 500 size - are represented in the Report. The age of respondents card programs vary from less than one year old to 15 or more years. 

Purchasing Card Spend in North America
Overall, purchasing card spending has continued to grow in a time of continuing economic challenges.  Between 2009 and 2011, purchasing card spending in North America grew from $161 billion to $196 billion.  Purchasing card spending growth in the past two years in the Corporate segment (27%) was higher than the Government and Not-for-Profit segment (12%).  Within the Corporate segment, Fortune 500 Size company purchasing card spending growth was lowest (at 23%).  Large Market and Middle Market corporations each reported 35% growth.  Among Government and Not-for-Profit entities, purchasing card spending growth was lowest among Federal Government agencies (at -2%) and State agencies (8%), but notably higher among Cities and Counties (17%), Universities (14%), School Districts (17%), and Not-for-Profit organizations (23%).  
Between 2009 and 2011, organizational purchasing card spending increases were driven primarily by increased card distribution throughout the organization, an increase in card spending limits, the increased use of electronic Accounts Payable card accounts (non-plastic card accounts used to pay for invoiced goods and services), and increased card acceptance by vendors, in particular for EAP and global card use.  Key growth categories for purchasing card use include: capital assets, printing and duplicating services, transportation and delivery services, utilities, and lease and rental payments, and telecommunication services.  In addition, the traditional spend categories of office equipment, computer hardware, software and peripherals, and MRO goods continue to be common targets of purchasing spending.
Going forward, the predicted purchasing card growth is 8% for 2012 and about a 9.6% per year average over the next five years.  Annual purchasing card spending is expected to increase to $212 billion in 2012, $247 billion by 2014, and $290 billion by 2016.  Corporate respondents project an annual average purchasing card spending growth rate over the next five years (11.2%) that is higher than that projected by Government and Not-for-Profit respondents (6.4%).  

New Insights
As in six previous studies since 1998, the 2012 edition of the Purchasing Card Benchmark Survey Results examines best practices of “high performing” purchasing card programs and sheds light on continuing market trends.  The 2012 edition provides unique and fresh insight into the use of purchasing cards outside of North America, the use of purchasing cards in support of mobile technology, the impact of integrating purchasing data into organizational databases, the use of card program assessment and optimization techniques, and supplier relationship issues, among other important issues.  The Report also offers many innovative suggestions from end-users on topics ranging from program management to technology.
A special section of the 2012 Purchasing Card Benchmark Survey Results is devoted to the use of and spending patterns associated with electronic Accounts Payable (or EAP, defined as non-plastic purchasing card accounts used to pay for goods and services after an invoice has been received for those goods or services).  About 35% of respondents currently use EAP.  Another 8.7% of respondents plan to adopt EAP in the next year and 12% plan to adopt EAP within three years.  Thus, EAP use is expected to rise from 34.9% in 2011 to 55.6% in 2014.  The average EAP spending is $1,070,751 per month.  The average EAP transaction is for $2,359, over seven times larger than a typical purchasing card account transaction.  EAP spending grew by 67% (or about 33% per year) in the two-year period between 2009 and 2011.  Because spending patterns and norms for organizations that are heavily involved in EAP payment methods are significantly different from traditional purchasing card programs, we analyze them separately and in-depth in a companion study entitled the 2012 Electronic Accounts Payable Benchmark Survey Results. 

Organizational Impact
The average administrative cost (including sourcing, purchasing, and payment activities) of a traditional Purchase Order-based process was reported to be about $91. For purchasing card transactions, the cost to procure and pay for goods was reported around $17. Thus, purchasing cards generated administrative cost savings of about $74 per transaction when compared to traditional PO payment methods.  This translates into a transactional cost savings of more than $44 billion within North America on an annual basis.  
Further, in comparison to a traditional PO process, purchasing cards reduce the procurement cycle time by approximately nine days, and generally result in a reduction or redeployment of staff in AP and Procurement functions.  Twenty-seven percent of all organizations report the use of purchasing card data to obtain a higher discount for goods or services. In terms of supplier relations, 42% of all organizations indicate that, over the past five years, suppliers who accept purchasing cards have increased their share of business with their organization above that of suppliers not accepting purchasing cards. 

Benchmark Averages
Benchmarking data within the Report covers a variety of program outputs for end-users to compare their own programs to. For all respondent purchasing card programs combined, key averages are: 
 
       
  • Monthly spend per organization: $2.1 million 
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  • Transaction size: $343
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  • Monthly spend per card: $2,393
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  • Number of transactions per card per month: 7
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More importantly, the Report provides benchmark purchasing card program statistics by size of business, type of governmental unit, and industry category.  

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