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The supply chain management (SCM) software market size is forecast to increase by USD 17.98 billion, at a CAGR of 12.35% between 2023 and 2028. The growth of the market depends on several factors, including the emergence of supply chain visibility and event management, increasing investment in warehouses by e-commerce service providers, and a rise in the number of strategic partnerships. These developments underscore the importance of effective supply chain management software in addressing the complexities of modern business operations. By leveraging such software solutions, businesses can optimize logistics and inventory processes, leading to enhanced efficiency and cost savings in the face of growing demand and competition. It also includes an in-depth analysis of market trends and analysis, market growth analysis and challenges. Furthermore, the market growth and trends report includes historic market data from 2018 - 2022.
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The market is experiencing significant growth due to the increasing adoption of industrial-grade digital technology in retail and e-commerce industries. Transparency in supply chain data is a key driver for this trend, as AI, machine learning technologies, and data analysis enable more effective supply chain strategies and streamlined SCM products. Supply chain visibility is crucial for operational agility and time-to-market efficiency. SCM solutions are helping businesses implement lean inventory and just-in-time replenishment, reducing the need for large warehouses and purchasing in bulk. Logistics is another area where SCM software is making a difference, with cloud-based solutions facilitating real-time supply chain transactions and improving supplier relationships. Demand management solutions are also becoming increasingly important, allowing businesses to optimize their supply chain based on current and forecasted demand. Overall, the SCM software market is being transformed by the integration of AI, machine learning, and other advanced technologies. These innovations are enabling more efficient and effective supply chain strategies, from purchasing and warehousing to logistics and demand management.
Increasing investment in warehouses by e-commerce service providers is notably driving the supply chain management software market growth. E-commerce service providers have set up warehouses to manage inventory and shipping. The WMS software, helps end users save time and improve the process of checking inventory and new shipments on a daily and monthly basis. E-commerce service providers need inventory management to improve the accuracy of incoming and outgoing inventory calculations.
Increased warehouse construction by e-commerce service providers will drive WMS adoption. Some examples related to investing in storage facilities include Walmart investing USD 1.2 billion in its Chinese supply chain to modernize its logistics. Growth in the global e-commerce market will increase investment in warehouses and drive the growth of the SCM market during the forecast period.
The adoption of big data analytics and IoT is a key trend influencing the market growth. IoT and big data help end-user industries such as healthcare, retail, manufacturing, financial services, banking and insurance, education, transportation, SCM, logistics, and agriculture to analyze and improve operational efficiency. IoT devices and connected sensors are increasingly being implemented in the supply chain and logistics industries to enable operational efficiency and real-time tracking. Big data analytics can manage the large amount of information generated by IoT devices in the SCM system. Massive amounts of data collected by sensors can be analyzed in real-time to make informed decisions and derive solutions that help in improving operations. IoT, in conjunction with big data analytics, can help companies improve operational efficiency.
Several logistics service providers have implemented big data and IoT in their SCM systems. Integrating digital twins and supply chain solutions minimizes human interaction with systems through machine-to-machine communication, enabling efficient monitoring and management of warehouse operations. Increasing integration of IoT and big data will have a positive impact on the growth of the market during the forecast period.
The high initial cost and availability of open-source applications are challenging the supply chain market growth. The rising costs can be attributed to software licensing, installation, maintenance, hardware, customization, and training costs. Controlling and monitoring ongoing transportation and logistics activities outweighs the high cost of installing data collection devices in transportation vehicles and IT infrastructure. Because of this, problems are faced by various stakeholders. For example, implementing SCM software requires IT staff to be trained with skills related to administration and staff dedicated to operations. Once implemented, the SCM solution needs to be updated regularly to keep up with current market trends and integrate with advanced technologies such as big data and blockchain. These factors increase the cost of implementing and maintaining SCM solutions.
Further, the availability of open-source solutions such as Odoo, OpenBoxes, xTuple, OpenLMIS, and Sellsy pose challenges to the various vendors operating in the global SCM software market. The majority of end users use SCM software solution which is open source as it does not require a large investment. However, such solutions have only basic functions and cannot cope with complex tasks, so they are suitable for small and medium-sized enterprises that do not have a heavy task load. Such factors will limit the growth of the market during the forecast period.
The market forecasting 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 report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting 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.
American Software Inc: The company offers demand-driven supply chain management and enterprise software solutions.
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 share growth by the SCP segment will be significant during the forecast period. SCP includes processes such as sales and operations planning, demand planning, demand gathering, strategic supply network design, and long-term and strategic planning. SCP is an integrated business management process and the software helps senior management and leadership teams keep all functions in the organization in sync. It manages and provides data on sales plans, production plans, inventory plans, and financial plans.
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The SCP segment was valued at USD 6.03 billion in 2018. Companies around the world are implementing SCP software solutions to balance supply and demand by effectively managing inventory using sales data and demand forecasts. SCP software solutions provide insight to supply chain managers by analyzing trends in sales and operational plans. Vendors in the market offer SCP software solutions to effectively manage sales and demand forecasts. To achieve operational efficiencies, manage sales data, and effectively forecast demand for products and services, the end-user implements SCP software into the operational processes of its supply chain.
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APAC is estimated to contribute 35% 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. North America offers the greatest growth opportunity for SCM providers due to the increasing implementation of automation SCM technologies in logistics and supply chains. The availability of advanced network communication infrastructure and a well-developed ecosystem of connected devices facilitates the implementation of automation technologies in this region. Some end-users in the logistics and supply chain industry in the region have already adopted advanced supply chain technologies such as IoT, machine learning, predictive analytics, and artificial intelligence that enable the effective implementation of intelligent solutions. The region has seen large vehicle movements across a variety of industries, including retail, oil and gas, and construction. In addition, growth in cross-border trade between the United States and Canada and between the United States and Mexico has also increased fleet movements. For this reason, fleet managers and owners can focus on implementing a fleet management system to optimization of their operational cycles. As fleet management system adoption grows, buyers will integrate their IoT devices, wireless connectivity solutions, and software supply chain to efficiently manage operations.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
Supply Chain Management (SCM) software plays a crucial role in optimizing business operations and enhancing efficiency in modern enterprises. SCM software facilitates seamless communication and collaboration between various stakeholders in the supply chain network, enabling real-time tracking and monitoring of inventory levels, orders, and shipments. The global SCM software market is thriving due to the increasing demand for streamlined supply chain processes and the growing adoption of digital technologies. Supply chain visibility and transparency are key drivers for businesses seeking to improve their competitiveness and customer satisfaction. SCM software solutions offer various features such as demand forecasting, supplier management, order management, and transportation management. These features help businesses to minimize lead times, reduce inventory costs, and improve overall supply chain performance. Moreover, the integration of advanced technologies like Artificial Intelligence (AI), Machine Learning (ML), and Internet of Things (IoT) in SCM software is expected to further revolutionize the market. These technologies enable predictive analytics, automated decision-making, and real-time monitoring, providing businesses with a competitive edge in today's dynamic market environment. In conclusion, the SCM software market is witnessing significant growth due to the increasing demand for efficient and agile supply chain processes, the adoption of digital technologies, and the integration of advanced technologies like AI, ML, and IoT.
Industry Scope |
|
Report Coverage |
Details |
Page number |
185 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 12.35% |
Market growth 2024-2028 |
USD 17.98 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
11.12 |
Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
Performing market contribution |
APAC at 35% |
Key countries |
US, China, Germany, UK, and Japan |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
3M Co., American Software Inc., Coupa Software Inc., Cybozu Inc., Descartes Systems Group Inc., E2open Parent Holdings Inc., Epicor Software Corp., Infor Inc., International Business Machines Corp., Kinaxis Inc., Magaya Corp., Manhattan Associates Inc., Microsoft Corp., Oracle Corp., Panasonic Holdings Corp., SAP SE, Solvoyo, Sonata Software Ltd., StockIQ Technologies Inc., and Webgility Inc. |
Market dynamics |
Parent market analysis, Market forecast, 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 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 Application
7 Market Segmentation by Deployment
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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