Supply Chain Management Market Will Exceed $13 Billion in 2017 and is Predicted to Reach $19 Billion by 2021
The supply chain management (SCM) market is predicted to exceed $13 billion in total software revenue by the end of 2017, up 11 percent from 2016. It is also on pace to exceed $19 billion by 2021, as digitalization and software as a service (SaaS) enable new revenue opportunities, this according to new research by Gartner.
As firms seek to take advantage of the huge amounts of supply chain data that can now be generated, SCM providers are differentiating themselves from competitors and creating new revenue streams by incorporating digital business technologies, such as mobile, machine learning, in-memory technologies, multi-enterprise visibility and the Internet of Things (IoT) into their offerings.
These digital supply chain offerings provide for faster decision-making, improved efficiency and end-to-end visibility. These benefits are driving greater investment. Additionally, the move to SaaS delivery shifts costs from capital expenditure (capex) to operational expenditure (opex) making investment in SCM technology more attractive to small and midsize businesses.
Overall, SaaS revenue growth is driven by a combination of factors: vendors moving to cloud-first or cloud-only deployment models, and firms becoming more comfortable with issues such as cloud security and appreciating the capabilities and innovation of leading-edge SaaS solutions. By 2021, SaaS deployments are forecast to account for more than 35 percent of total SCM spending.
The SCM market forecast is made up of three categories: supply chain planning (SCP), supply chain execution (SCE) and procurement.
To learn more about next-generation supply chains, download the 2017 MHI Annual Industry Report: Next-Generation Supply Chains: Digital, On-Demand and Always-On .
