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The smart warehousing market size is forecast to increase by USD 10.97 billion, at a CAGR of 11.37% between 2022 and 2027. Market expansion hinges on various factors, including the global proliferation of e-commerce, heightened demand for warehouse autonomous robots, and an increasing emphasis on sustainability within warehousing practices. With the exponential growth of online shopping, warehouses face mounting pressure to streamline operations and enhance efficiency to meet escalating consumer demands. Consequently, there is a rising adoption of automation and robotics technologies to optimize inventory management, order fulfillment, and logistics processes. Additionally, as environmental consciousness grows, businesses are prioritizing sustainable practices, including energy-efficient warehouse designs, eco-friendly packaging solutions, and waste reduction initiatives. By embracing these trends, companies aim to minimize their environmental footprint while simultaneously improving operational performance and customer satisfaction. These interconnected dynamics underscore the trajectory of market growth, presenting opportunities for innovation and advancement within the warehousing sector.
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In the market, automation software optimizes processes while addressing concerns such as ransomware and other cybersecurity threats through measures like IoT sensors and cloud technology. Smart warehousing facilitates streamlined order allocation and order picking, contributing to a more efficient production system and justifying capital investment in these innovative solutions.
This market forecast report extensively covers market segmentation by deployment (cloud-based and on-premise), component (hardware, software, and services), and geography (North America, Europe, APAC, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The cloud-based segment is estimated to witness significant growth during the forecast period. Cloud-based smart warehouse refers to the deployment of smart warehouse applications and solutions on a cloud computing platform. Cloud-based solutions offer a number of benefits, including scalability, flexibility, real-time data access from anywhere, and automated updates and maintenance. Several global smart warehousing market players are offering cloud-based smart warehousing solutions.
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The cloud-based segment was the largest segment and was valued at USD 6.70 billion in 2017. Market players offer cloud-hosted applications and software platforms that enable businesses to deploy smart warehousing functionality. For example, International Business Machines Corp's cloud offers a suite of cloud-based solutions, including an IoT platform and AI-based analytics, that can be used for smart warehousing applications. As a result, cloud-based smart warehouse solutions offer significant benefits to modern warehouses, including scalability, flexibility, real-time data analytics, and reduced IT costs. Hence, such factors will fuel the growth of the cloud-based segment in the global smart warehousing market during the forecast period.
Based on component, the market has been segmented into hardware, software, and services. The hardware segment will account for the largest share of this segment. In the global smart warehousing market, hardware components are important in transforming traditional warehouses into efficient and automated facilities. Key hardware includes automated guided vehicles (AGVs) for automated material handling, robots for tasks such as picking and packing, sensors for real-time data collection, code scanners barcodes, and RFID systems for item identification and tracking, as well as conveyors and sorting systems for streamlined flow. of materials. These technologies improve warehouse productivity, optimize inventory management, and enhance overall operational efficiency, making smart warehousing a competitive advantage in the modern supply chain landscape. Therefore, the growth of the warehousing industry will drive the growth of the hardware segment during the forecast period.
North America is estimated to contribute 41% to the growth of the global market during the forecast period.
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Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. North America is the early adopter of technology across industries, and the region is an attractive market for smart warehousing solutions. Characterized by the presence of several advanced economies, the industrial sector is technologically advanced in the region.
Furthermore, the region is home to a number of global companies, such as Oracle Corp., International Business Machines Corp., Infor Inc., Manhattan Associates Inc., and others. These prominent players are major technology providers, logistics companies, and startups offering innovative smart warehousing solutions. Their presence and contribution play an important role in shaping the growth and development of the smart warehousing market in the region during the forecast period.
The market is witnessing rapid growth driven by advancements in warehousing technologies aimed at enhancing efficiency and productivity while reducing labor expenses. These technologies ensure higher accuracy in inventory management and order fulfillment, mitigating the risk of errors. Across various vertical such as transportation and logistics, retail and ecommerce, manufacturing, and energy and utilities, smart warehousing solutions leverage wearables, rugged tablets, and barcode scanners for seamless operations.Our researchers analyzed the data with 2022 as the base year and the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Growing E-commerce globally is the key driver for the growth of the market. E-commerce has seen significant growth across the globe over the past few years, transforming the way consumers shop and businesses operate. The advent of the internet and the widespread use of smartphones have boosted this growth, allowing people to browse, compare, and buy products online with ease. As a result, e-commerce has become an important driver in the global smart warehousing market.
Moreover, smart warehouses give real-time visibility into warehouse operations, allowing businesses to track order status and inventory levels, ensuring efficient order processing and timely deliveries. Additionally, a cloud-based warehouse management system (WMS) provides scalability and flexibility, allowing e-commerce businesses to quickly adapt to changing needs. Hence, the growth of e-commerce globally is expected to propel the growth of the global smart warehousing market during the forecast period.
Increasing number of new product launches is the primary trend shaping the growth of the market. The global smart warehousing market players are constantly introducing new and innovative products. These products often leverage advanced technologies such as AI, IoT, robotics, and cloud computing to further optimize warehouse operations. Additionally, robotics process with robotics and automation with new product launches often focus on improving efficiency, improving inventory management, reducing operating costs, and providing better analytics for data-driven decision-making.
For instance, in May 2020, Manhattan Associates announced its first enterprise-grade cloud warehouse management solution. The solution consolidates all distribution functions and requires no upgrades. Hence, the increasing number of new product launches is expected to boost the growth of the global smart warehousing market during the forecast period.
Data security and privacy concerns associated with smart warehousing solutions is the challenge that affects the growth of the market. One of the big data security challenges facing smart warehouses is securing the network of connected devices and systems. A large number of sensors, cameras, robots, and other smart devices found in modern warehouses create multiple entry points for potential cyberattacks. Hackers can try to exploit vulnerabilities in these devices to gain unauthorized access to sensitive data or disrupt warehouse operations. Therefore, the implementation of strong cybersecurity measures, such as encryption, firewalls, and intrusion detection systems, is essential to protect against potential threats.
Furthermore, data security is an important aspect of smart warehouses, especially when personal information about customers, employees, and business partners can be collected and stored. Companies must comply with various data protection regulations. Failure to comply with these regulatory requirements can lead to significant financial penalties and damage to a company's reputation, which can become a major challenge and impede the growth of the market during the forecast period.
The market research 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 forecasting 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.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative 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.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023 to 2027, as well as historical data from 2017 to 2022 for the following segments
The market is witnessing a transformative shift with a focus on enhancing energy efficiency and operational productivity through the adoption of advanced technologies. Automation equipment such as robotics and warehouse execution systems streamline processes, although challenges such as integration complexities persist. Leveraging artificial intelligence and augmented reality, smart warehouses optimize inventory management and order fulfillment, while virtual reality aids in training and simulation. By integrating automated technologies alongside human workers, warehouses achieve a balance between efficiency and workforce management. Barcode scanning and digitization enable real-time tracking and data analysis, optimizing global supply chains and mitigating transportation delay. Ultimately, these innovations improve customer experienc by ensuring timely deliveries and efficient operations.
Market Scope |
|
Report Coverage |
Details |
Page number |
157 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 11.37% |
Market growth 2023-2027 |
USD 10.97 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
10.29 |
Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
Performing market contribution |
North America at 41% |
Key countries |
US, Canada, China, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Edgewise Technologies Pvt. Ltd., Epicor Software Corp., Foysonis LLC, IAM Robotics, Infor Inc., International Business Machines Corp., Koch Industries Inc., Koerber AG, Locus Robotics Corp., Manhattan Associates Inc., Oracle Corp., Panasonic Holdings Corp., PTC Inc., SAP SE, ShipHero LLC Inc., Snapdeal Ltd., Softeon, Synergy Logistics Ltd., Tecsys Inc., and Vinculum Solutions Pvt. Ltd. |
Market dynamics |
Parent market analysis, 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 forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Deployment
7 Market Segmentation by Component
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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