Global supply chain management software market grows

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SAP and Oracle lead the way

The worldwide supply chain management (SCM) software market has increased in revenue by 12.3 percent since 2010.

According to a report by Gartner, this market totalled $7.7 billion in 2011, marking the second year of double-digit growth for the SCM software market.

The analyst house said this was as a result of an increasing number of supply chain investments as well as existing ones keeping their priority statuses and moving forward, despite caution from IT budget heads.

Chad Eschinger, research vice president at Gartner, said: “Despite ongoing economic uncertainty, the market for supply chain applications showed itself to be pretty resilient in 2011 with most SCM providers continuing to expand their footprints.

“North America and Western Europe continued to be the prime consumers of SCM software in terms of dollars spent, with nearly 79 percent of market revenue. However, European growth slowed in 2011 while Asia/Pacific continued to experience robust growth that significantly outpaced the market average.”

SAP was the top of the market leading this industry and accounting for 19.9 percent of the worldwide market, while Oracle rolled into second place with a 16.9 percent market share. Ariba experienced the strongest growth among the top five vendors with SCM software revenue increasing 46.5 percent in 2011.

Gartner said that despite the software market being “fragmented, with a plethora of small and midsize vendors” (with revenue of less than $50 million) across regions and its four primary market segments, the top five vendors — SAP, Oracle, JDA Software, Ariba and Manhattan Associates  held their own.

They collectively held 48.3 percent of the worldwide SCM software market based on 2011 total software revenue.

SCM offerings delivered as software as a service (SaaS) subscriptions also contributed to the overall market with an above-market growth of 21 percent in 2011. This covered both long-standing incumbents and many best-of-breed point product vendors, with focused capabilities for specific niche markets.

Perpetual licences also grew significantly at 15 percent.

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