The annual growth of 10.8% in supply chain management (SCM) and procurement software applications is performing better than the majority of US software markets and is worth a total of $9.9 billion as of 2014, Gartner Inc. has reported.
The procurement software and SCM markets have witnessed steady growth in the face of healthy demand for applications. Supply chains remain a key factor in maintaining a competitive advantage and fueling objectives in business growth, which include increasing customer satisfaction, business agility, plus improving operations.
The leaders in modernizing their supply chain engaged opportunities in both large and specialized operations, and in doing this boosted agility and moved innovation forward throughout 2014. SCM applications delivered during this period, as there was growth of 17%, well ahead of the market curve. New on premises licenses saw significant growth as well, though lower at 9%, with companies wanting to upgrade their supply-chain portfolio via a number of different delivery models.
The largest amount of growth was in SAP at 19.9%, this is an improvement over last year when it was also top performer, and it’s market share within SCM markets has grown to 25.8%. There is a continuation of the trend for the introduction of new and newly acquired SCM products into the market, and has the ability to upsell solutions from within the established ERP base currently installed. Although Oracle continues to be the second biggest provider in the supply chain technology market and is also the largest SCE (supply chain execution) provider, the momentum it had from software revenue has fallen off slightly, market share now stands at 14.6% compared to 16% last year.
A total revenue of $438 million means that JDA software has retained third place in the global market share rankings, and currently holds 4.4% of the entire market. It remains the biggest pure play vendor, which is focused on the supply chain irrespective of the 1.7% decline it saw compared to 2013.
The SCM market as a whole is fragmented; the top 10 vendors retain 55% of the market. The remaining 57 vendors who comprise the rest of the market saw their collective annual revenue grow by 9.6%. This points to opportunities not only in the acquisitions driven market, but also for specialized and complementary to the larger offerings from suite providers.