Coupa Business Spend Index Reveals that Business Spend Sentiment is Gradually Improving for Third Consecutive Quarter
Specifically, the Coupa BSI Q1 2021 Outlook shows gradual improvement in business spend sentiment for the third consecutive quarter. This data suggests that the recovery of business spend sentiment is underway following the sharp decline noted in the Coupa BSI Q2 2020 Outlook that aligned to the start of the COVID-19 pandemic. However, businesses remain cautious about the global economic outlook and all industry sectors, with the exception of high tech, remain below trend.
Data from the past quarter shows the following year-over-year changes in business spending:
- 96 percent decrease in business spending on air travel
- 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
Spend Sentiment by Vertical Industry:
- Financial Services: Although below trend for the last four quarters, the sector is improving bolstered by refinancing activity, stimulative fiscal policy, and continued accommodative monetary policy by the
Federal Reserve. Improved spend sentiment for Financial Services implies the sector is expected to contribute more positively to U.S.GDP growth for 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.
To view the Coupa BSI Q1 2021 Outlook in its entirety, visit www.spendindex.com.
Disclaimer: The findings of the BSI are not necessarily indicative of trends happening with Coupa's business.
The Coupa BSI Methodology
The Coupa BSI is an early indicator of potential economic growth based on current business spending decisions of hundreds of
The Coupa BSI is normalized to a baseline value of 100, which represents the weighted composite value of the three components in the baseline reference period (
Coupa empowers companies around the world with the visibility and control they need to spend smarter and safer. To learn more about how Coupa can help you spend smarter, visit www.coupa.com. Read more on the Coupa Blog or follow @Coupa on Twitter.
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Stefanie Gordish, firstname.lastname@example.org, 415-590-9722