Coupa Sees Business Spend Sentiment Improving
February 10, 2021
Software published the findings from its Business Spend Index (BSI), Q1
2021 Outlook. The Coupa BSI analyzes billions of dollars of aggregated
and anonymized business spend decisions across Coupa’s platform, often
serving as an early indicator of macroeconomic health over the next
three to six months. The Q1 Outlook shows that business spend sentiment
is gradually improving (an increase of 2.9 percent), but is still below
25 percent decrease in business spending on office supplies
11.5 percent increase in business spending on technology, including hardware, software, and services
22.8 percent increase in contingent workforce spend
12.3 percent increase in business spending for shipping and freight
“While the Coupa BSI Q1 2021 Outlook shows modest improvement overall, a
return to trend is unlikely until the number of new COVID cases reported
daily has been significantly reduced,” said Jeff Collins, chief
economist at Coupa. “Although government action to combat the economic
consequences of the pandemic has likely mitigated the depth of the
downturn, we do not expect the U.S. economy to return to ‘normal’ levels
of output or employment in the next three to six months.”
Health and Life Sciences: Spend sentiment for Health and Life Sciences declined sharply from the previous quarter. The sector has been hard hit by the resurgence of COVID-19 cases and is expected to remain below trend for the next three to six months.
High Tech: Confidence in the tech sector, which has remained high throughout the pandemic, is now returning to trend. Companies in this sector are expected to benefit long-term from changes brought about by the pandemic and continue to contribute positively to U.S. GDP growth for the next three to six months.
Manufacturing: Spend sentiment for Manufacturing rebounded, but is still well below the trend line. Demand is expected to increase as vaccinations and warmer weather reduce the negative impact of the pandemic on the sector.
Retail: The Retail sector continues to improve but is still below trend, as uncertainty caused by layoffs and business shutdowns persist. However, stimulus checks and low interest rates are expected to mitigate the impact of the pandemic in the months to come.