Vendor Risk Management Market Size

Vendor Risk Management Market Analysis

The Vendor Risk Management Market size is estimated at USD 11.98 billion in 2024, and is expected to reach USD 21.59 billion by 2029, growing at a CAGR of greater than 12.5% during the forecast period (2024-2029).

The increasing number of third-party vendors in large as well as in small and medium enterprises, rapidly changing regulations across different regions, and the need to continuously monitor and analyze vendor performance are some of the factors responsible for the growing demand for vendor risk management.

• Vendor risk management programs have an exhaustive plan for identifying and mitigating business uncertainties, legal liabilities, and reputational harm. As companies increase their use of outsourcing, VRM and third-party risk management evolve into an increasingly essential part of any enterprise risk management framework. A vendor risk program can enable organizations to observe supplier relationships over time, identify new risks, and measure supplier performance.
• Many extensive businesses are discovering that their systems and procedures related to VRM need to be revised from a purely business standpoint. They might have to pay substantial damages due to inadequate vendor risk management framework. For instance, an average of 30,000 different parts is required to create a single vehicle, increasing the complex processes and supply chain coordination necessary to manufacture automobiles globally. The supply chains, with numerous third-party manufacturers and service providers, contain a significant source of risk for manufacturers in a domino effect, which, in turn, is expected to increase the need for vendor risk management.
• In July 2023, AuditBoard launched its new IT risk management offering, AuditBoard ITRM, a purpose-built solution for CISOs and their teams. AuditBoard ITRM is designed to enable collaboration between IT security and other organizational functions to accelerate the identification and classification of IT systems, perform business impact assessments, and remediate identified issues, according to AuditBoard.
• Moreover, various laws and agencies such as the Office of the Comptroller of the Currency (OCC), the Health Insurance Portability and Accountability Act (HIPAA), the Consumer Financial Protection Bureau (CFPB), the Foreign Corrupt Practices Act (FCPA), Dodd-Frank, the HITECH Act, and the Gramm-Leach-Bliley Act require enterprises to set up a robust VRM framework, driving the end-user to adopt these solutions.
• The spread of the COVID-19 pandemic emphasized the need for solutions that would help organizations efficiently manage supply chains, identify critical suppliers, and omit any risks that are expected to augment the growth of vendor risk management solutions across various industries. The increased adoption of the cloud and the need for real-time analytics are expected to proliferate the market growth.