Category management and MRO procurement

Digitisation and supplier rationalisation are changing the way category management operates. The RS and CIPS 2026 Indirect Procurement Report shows a sector achieving more with less resources.

Category management in Maintenance, Repair and Operations (MRO) is being quietly, but fundamentally, rewired. Organisations in the UK and Ireland are buying from fewer suppliers, spending less overall, and in many cases processing orders at a lower internal cost. Our latest research points to a procurement model built on tighter supplier cohorts, faster fulfilment at the point of need, and more disciplined cost-to-serve.

Driving down costs through digitisation
Digitisation is transforming category management in MRO. There are fewer manual touchpoints, more catalogue buying for repeat items and automated approvals for standard, low-risk parts. Teams are deliberately redesigning the experience for end users, enabling companies to significantly reduce average cost to process an order.

Paul Duncombe, Commodity Manager at Siemens UK, frames the shift like this: “MRO category success will be defined less by heroic spot-buys and more by frictionless processes: clean catalogues, intuitive search, guided choices and embedded sustainability data so the ‘right’ product is also the easiest one to buy.”

Understanding the internal cost of buying something - including the time to source a product, raise and approve an order, receive and book it in, match the invoice, and resolve exceptions - is the foundation of smart category management. It tells you where automation is worth it, where consolidation pays off, and where ‘cheap on paper’ is in fact expensive in practice. Yet only 37 per cent of respondents said they know their cost to process an order. That headline is broadly unchanged from last year but for those who do effectively track order costs, the benefits are becoming clearer, with costs falling fast.

Among organisations with visibility, 72 per cent now say their cost is below £100. Most significantly, the average cost to process an order has dropped from £89 to £77 in a year. The Chartered Institute of Procurement & Supply (CIPS) argues that organisations “need to invest further in technology, and perhaps AI, to surface better insights, good data and improved supply chain visibility.” The data shows that it is in fact large enterprises that often lack one coherent view due to fragmented systems as a result of the legacy of past acquisitions and consolidation. As Martin Wakelin, Group Head of Indirect Procurement at Valeo Foods, notes: “Category excellence begins with pulling that data into one view the business can act on.”

Recalibrating the supplier base: fewer MRO suppliers, on purpose
One of the clearest structural shifts is supplier rationalisation. Organisations now work with an average of 83 MRO suppliers, down from 92 last year. This trend is driven by smaller and mid-sized organisations, as large firms face complexity that constrains radical reduction. Consolidating tail suppliers concentrates spend, which further strengthens the negotiating position and makes it easier to secure better terms, rebates and service levels, as well as tighter control of specification and compliance.

Spend reduction = discipline
Reported MRO spend has fallen by 16% to an average of £1.7m, down from £2m last year. What might look like austerity is, in fact, discipline. CIPS sums up the mood:

“We live in a very cost-conscious world. All procurement and supply chain professionals are under pressure to reduce costs, not just of goods but within their own operations. Organisations everywhere are striving to become both leaner and more agile, taking out cost while improving their ability to respond quickly to change.”

Crucially, spend has not collapsed in critical areas; what is shrinking is discretionary or poorly controlled spend. The category is being actively managed, not only cut.

Speed under pressure
When a line is down or an asset fails, procurement is expected to act like an extension of operations. The survey shows 66 per cent of organisations will place an emergency order within a day of receiving a quotation. But speed varies by size, with smaller and mid-sized firms more likely to place the order within a day compared to large organisations. Discrete and process manufacturing outperform the average, reflecting the higher cost of downtime. Duncombe emphasises the focus on user experience: “The future model is curated self-service with governance... quick, simple, and available is the bar for MRO.”

Redefining performance: what matters now
Key performance indicators (KPIs) are redefining “good.” On-time delivery remains number one at 65 per cent, and quality remains high at 61 per cent. Responsiveness has climbed to 44 per cent, showing a premium on suppliers who can react in hours, not days. Meanwhile, price has slipped in relative importance to 52 per cent. Buyers are signalling continuity and assurance matter at least as much as headline unit cost. Wakelin concludes:

“True MRO value is end-to-end, not just a cheaper unit price... the goal is fewer line stops, faster purchase-to-pay, and better total cost - not just a smaller number on the PO.”

To find out more about how economic uncertainty is rewriting the rules of procurement efficiency, download the report below.

Image of 2026 indirect procurement report

Category management and MRO procurement: control, consolidation and clarity

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