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The enterprise resource planning (ERP) software market size is estimated to grow by USD 34.73 billion at a CAGR of 10.67% between 2023 and 2028. The growth of the ERP software market is fuelled by factors like increased operational efficiency, rising demand from SMEs, and the popularity of cloud-based applications. However, the market faces challenges due to the escalating number of cyberattacks, which hinder its growth potential. As businesses seek streamlined workflows and integrated applications, innovative and advancing technologies, including mobile-friendly ERP solutions, become essential for maintaining competitiveness. Despite these challenges, the market continues to expand, driven by the need for efficient financial systems and organizational structure changes in the business landscape.
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The market is driven by the need for efficient supplier-relationship management and the integration of innovative and advancing technologies into business operations. With the adoption of mobile-friendly ERP solutions, organizations are enhancing workflows and achieving greater coordination. These systems also facilitate teamwork and support organizational structure changes, enabling businesses to adapt to new markets and the evolving business online concept. Despite challenges like high costs, ERP software is increasingly becoming indispensable for streamlining financial systems and integrating applications across various departments, thus driving the Enterprise Resource Planning Software Market Size.
The market is driven by a need for comprehensive planning, budgeting, forecasting, and reporting solutions. This includes supplier-relationship and customer-relationship management integrated within cloud-based ERP platforms. Innovative technologies fuel productivity, offering real-time decision-making and mobile-friendly solutions. With a customer-centric strategy, ERP systems facilitate adaptability and flexibility to address new product lines, markets, and organizational changes. For manufacturing SMEs and Large Enterprises alike, ERP streamlines operations and enhances coordination. Despite high costs, businesses seek ERP solutions for their customization capabilities, regional operations, and contactless transactions, with dedicated hardware ensuring control and effective communication while managing IT budgets.
Rising demand for ERP software from SMEs is the key factor driving market growth. Software is crucial for enterprises across all end-user organizations that focus on improving their operational and business process efficiency. SMEs, which used standalone applications for each of their business functions, started switching to planning software that allows the integration of multiple functions into a single integrated application. In addition, SMEs are migrating from paper-based operations to system-based automation software for their business analysis and operations.
Moreover, planning software is being implemented across SMEs for better management of their business operations through a centralized management system with improved collaboration, productivity, simplified compliance, and risk management. These factors are significantly driving the adoption of SMEs. The utilization of cloud-based applications across different verticals is also enhancing the growth of software. Cloud-based solutions are further reducing the installation, maintenance, and operating costs for SMEs. Thus, such factors will fuel the Enterprise Resource Planning Software Market Size during the forecast period.
Embedded data analytics features are the primary trend shaping market growth. Resource planning software architecture and design are also evolving to support real-time data. Modern systems leverage transactional data and in-memory computing to enable advanced reporting and analytics on the data. These capabilities are being incorporated within the software architecture, allowing the users to execute/run simulations without the need for standalone analytic applications, which, in turn, drives market growth. Moreover, extended analytical capabilities embedded within the software can help enterprises improve their response time to the planning ERP Software Market demand for their products. Thus, such factors will fuel the growth of the market during the forecast period.
The rising threat from open-source software is a challenge that affects market Enterprise Resource Planning Software Market Growth. The inflated cost of software led to the growing adoption of open-source software. The adoption is garnering attention across developing countries such as India and China. SMEs across various verticals, which do not have enough capital investments, tend to adopt open-source software. Large companies with a cost reduction strategy also prefer the adoption of open-source software. However, open-source software provides basic functionalities that are suitable only for small companies.
In addition, open-source software has various disadvantages, such as data management issues, low-quality support, and poor implementation plans. These issues pose a serious threat to an enterprise's operation. Thus, an increase in the adoption of open-source software can pose a challenge for the vendors offering on-premise and cloud-based solutions during the forecast period. Therefore, such factors may impede the Enterprise Resource Planning Software Market Growth during the forecast period.
The market offers various types of ERP systems tailored to meet diverse business needs. These systems encompass planning, budgeting, forecasting, and reporting, vital for effective financial management. Supplier-relationship management and customer-relationship management modules optimize interactions with suppliers and customers, fostering stronger business relationships. Cloud-based ERP platforms leverage innovative technologies, offering flexibility, scalability, and accessibility from anywhere, supporting a customer-centric strategy. Financial systems within ERP solutions provide integrated applications for productivity, workflows, and real-time decision-making. Mobile-friendly ERP solutions enable contactless transactions and facilitate teamwork, adaptability, and flexibility. They support organizational structure changes, expansion into new product lines, and new markets. ERP systems cater to various business sizes, from manufacturing SMEs to large enterprises, by streamlining and coordinating operations and enhancing effective communication. Despite their high cost, ERP solutions offer customization capabilities, dedicated hardware, and control over regional operations, aligning with IT budgets and enabling business online concepts.
The market share growth by the cloud based segment will be significant during the forecast period. The global market is undergoing a technological shift driven by the advent of cloud computing. The revenues from the cloud-based segment have grown at a rapid rate over the last five years, and the trend is expected to continue during the forecast period. The cloud-based segment is expected to dominate the market and account for a major contribution to the incremental growth of the Enterprise Resource Planning Software Market Size during the forecast period.
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The cloud based segment showed a gradual increase in the market share of USD 19.09 billion in 2018. Cloud-based software is typically hosted in remote data centers, allowing users to access the software through the Internet. The low upfront costs of cloud-based are driving its adoption across organizations, especially among SMEs that have limited IT budgets and resources. Cloud-based software offers several benefits, such as real-time application performance analytics, regular security updates, global accessibility from any location, and scalability. Therefore, such factors are expected to drive the cloud-based segment in the global Enterprise Resource Planning Software Market Growth during the forecast period.
The manufacturing industry leverages enterprise performance management applications for collecting, analyzing, and streamlining its operations data with its business strategies. The analyzed data is used to enhance production operations, improve decision-making processes, and improve sales strategies. Enterprise performance management applications are majorly adopted by manufacturing companies for strategic planning and execution, improving cost visibility and production processes, financial planning, budgeting, and forecasting. Manufacturing companies using enterprise performance management applications also analyze their operational and production data to estimate the optimum utilization of resources and forecast customer demands. Hence, such factors are expected to drive the growth of the global Enterprise Resource Planning Software Market Size in the manufacturing end-user segment during the forecast period.
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North America is estimated to contribute 42% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Software is one of the major segments of the enterprise market in North America. The US and Canada are the major revenue contributors to the market in this region. Enterprises in the region are early adopters of applications. However, future investments by enterprises in software in this region will be driven by their need to integrate existing platforms with advanced technologies such as blockchain, AI, and the Internet of Things (IoT)-enabled applications and data analytics.
Moreover, market players that offer in-built application programming interfaces (APIs) for these advanced technologies will have the opportunity to generate additional revenues through product upgrades and maintenance fees. Furthermore, an increase in the need for business process efficiency and transparency through digital transformation is also driving the adoption of software in this region. Thus, such the advantages of software are expected to drive the Enterprise Resource Planning Software Market Growth in North America during the forecast period.
The Enterprise Resource Planning Software Market Report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market research and growth report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market, as predicted in our Enterprise Resource Planning Software Market Report.
This Enterprise Resource Planning Software Market Growth report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative Enterprise Resource Planning Software Market Analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
In the market, effective planning, budgeting, forecasting, and reporting are essential for success. Supplier-relationship management ensures quality ingredients, while customer-relationship management fosters loyalty. Cloud-based ERP platforms and innovative technologies streamline operations, supporting financial systems and a customer-centric strategy. Integrated applications and workflows enable real-time decision-making, promoting teamwork and adaptability. Mobile-friendly ERP solutions facilitate contactless transactions, vital in today's business online concept. As the market expands into new product lines and markets, organizational structure changes are inevitable. Both manufacturing SMEs and Large Enterprises benefit from streamlining and coordination, supported by effective communication and dedicated hardware. Customization capabilities cater to regional operations, although they may come with a high cost.
The market is embracing innovative and advancing technologies, including Enterprise Resource Planning (ERP) systems, to enhance customer satisfaction and service. With the increasing use of mobile devices, SAP ERP mobile apps are enabling access to ERP functionalities on the go. As the market expands into new markets, ERP for manufacturing companies is becoming crucial, regardless of staff size or departments. Public infrastructure supports the control of SAP solutions, with technical experts providing consulting services for implementation. For large-scale organizations, digital transformation investment includes two-tier ERP for subsidiaries. ERP streamlines manufacturing processes, procurement, and supply chain management, with options for on-premises or cloud deployment models tailored to enterprise type, including midsize enterprises. Hybrid solutions cater to multiple sites and are accessible on mobile and tablet devices, particularly in IT & telecom sectors.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in USD Billion for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
Market Scope |
|
Report Coverage |
Details |
Page number |
180 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 10.67% |
Market Growth 2024-2028 |
USD 34.73 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
9.11 |
Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
Performing market contribution |
North America at 42% |
Key countries |
US, Canada, Mexico, China, and Germany |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Acumatica Inc., Citrix Systems Inc., Computer Generated Solutions Inc., Dassault Systemes SE, Ellucian Co. LP, Epicor Software Corp., IFS World Operations AB, Koch Industries Inc., Microsoft Corp., Odoo SA, Oracle Corp., Roper Technologies Inc., Sage Group Plc, Salesforce Inc., SAP SE, ServiceNow Inc., SYSPRO Pty. Ltd., TOTVS SA, Unit4 Group Holding B.V., and Workday Inc. |
Market dynamics |
Parent market trends and analysis, Enterprise Resource Planning Software Market Analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our Enterprise Resource Planning Software Market Report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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