Supply Chain Management (SCM) Market By Solution (Software, Services), Deployment (Cloud-Based, On-Premises), Enterprise Size (SMEs, Large Enterprises), Industry (Retail & Consumer Goods, Manufacturing, Automotive, Healthcare & Pharma, Food & Beverages, Transportation & Logistics) & Region - Forecast to 2021 - 2031
Supply Chain Management Market - Analysis, Outlook, Growth, Trends, Forecasts
- September 2021
- 372 pages
Supply Chain Management Industry Snapshot
The supply chain management (SCM) market solutions revenue totaled ~US$ 19.5 Bn for 2020, according to Future Market Insights’ (FMI’s) latest study. The overall market is expected to reach ~US$ 62.6 Bn by 2031, growing at a CAGR of 11.4% for 2021 – 31. The demand for supply chain management solutions will accelerate with top 5 providers holding around 50.2% of total market in 2020.
Newly released data on the supply chain management demand outlook indicates 8.7% y-o-y growth in 2021. Among industry verticals, the market share for retail & consumer goods sector is the largest among all. However, the transportation & logistics segment will grow at 14.6% CAGR to emerge as the fastest growing end user through the assessment period.
Key Points Covered in Supply Chain Management Market Study
- Market estimates and forecast 2016-2031
- Key drivers and restraints impacting market growth
- Segment-wise, Country-wise, and Region-wise Analysis
- Competition Mapping and Benchmarking
- Market Share Analysis
- Key Product Innovations and Regulatory Climate
- COVID-19 Impact on Supply Chain Management market and how to Navigate
- Recommendation on Key Winning Strategies
2016-2020 Supply Chain Management Demand Outlook Compared to 2021-2031 Forecast
Increasing demand for supply chain management (SCM) market solutions from both large enterprises and small and medium enterprises (SMEs), growing awareness about the benefits offered by SCM solutions, including supply chain optimization, forecasting accuracy, meaningful synthesis of business data, and wastage minimization are likely to fuel the demand for supply chain management solutions over the coming years.
The SCM sales is estimated to rise at 11.4% CAGR between 2021 and 2031 in comparison with 8.6% CAGR registered during 2016-2020.
In the quest to remove supply channel costs, streamline channel communications, and link customers to the value-added resources found along the supply chain continuum, SCM has emerged as a tactical operations tool.
Supply chain management (SCM) market has undergone a sea change in the 21st century -- by embedding product and process innovation in supply chain operations and consciously managing and shaping demand from customers. There is a lot of potential in benefitting from new age supply chain management solutions as companies recover from the recent financial crisis and position supply chains as enablers of revenue and margin growth.
Moreover, procurement processes that support the design and management of a sustainable supply chain are becoming critical for providers of goods and services in nearly every part of the world. In the demand-driven supply chain, companies are looking toward more lean procurement processes.
The global supply chain management growth scenario is anticipated to witness an increase in revenue from ~US$ 21.2 Bn in 2021 to ~US$ 62.6 Bn by 2031.
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How are Advances in Technologies Helping the Supply Chain Industry Evolve?
In the current scenario, rise in need for demand management solutions among enterprises and adoption of SCM software in healthcare and pharmaceutical companies are expected to fuel the market growth.
In addition to this, the surge in demand for transportation management systems (TMS) software and integration of block chain technology in SCM software is expected to drive the growth of the SCM market in the upcoming years. Advanced technologies such as the Internet of Things, artificial intelligence, robotics, and 5G, SCM solutions are designed to anticipate and meet future challenges.
Moreover, big data analytics in logistics and supply chain management (LSCM) has garnered increasing attention owing to its complexity and the prominent role of LSCM in enhancing the overall business performance. The power of data is becoming evident to businesses of all shapes and sizes, from financial service to automobile manufacturing, healthcare, NGO, and more.
It is increasingly becoming essential to make the best use of Big Data analytics in a supply chain to generate more profound insights. The retail sector streams a massive amount of data across its supply chains, at diverse customer touch points in many omnichannel operations. This is in turn creating huge demand for supply chain management solutions over the forecast period.
What Is the Impact of COVID-19 Crisis on Supply Chain Management Demand?
COVID-19 pandemic has impacted every sector and due to social distancing norms organizations are transforming towards digitalization to ensure the safety. A decades-long focus on supply chain optimization to minimize costs, reduce inventories, and drive up asset utilization has removed buffers and flexibility to absorb disruptions and COVID-19 illustrates that many companies are not fully aware of the vulnerability of their supply chain relationships to global shocks.
Fortunately, new supply chain technologies are emerging that will dramatically improve visibility across the end-to-end supply chain, and support companies’ ability to resist such shocks. The traditional linear supply chain model is transforming into digital supply networks (DSNs), where functional silos are broken down and organizations become connected to their complete supply network to enable end-to-end visibility, collaboration, agility, and optimization.
The recent COVID-19 outbreak is expected to have an impact on the growth of the various end-user industries (excluding the pharmaceutical industry) in the short term. However, the impact is temporary, and the supply chain management market (SCM) is anticipated to show considerable growth during the forecast period. Thus, the demand for supply chain management is estimated to witness a slight decline, temporarily, from around 9.1% to 8.7% Y-o-Y from 2019 to 2021.
How big is the Opportunity for Supply Chain Management (SCM) Adoption in the U.S.?
North America is predicted to remain one of the most attractive markets during the forecast period, according to Future Market Insights. According to the study, the U.S. is expected to account for more than 79% of the North America market share through 2031.
This growth can be attributed to the rise in spending on logistics & transportation, which is improving the implementation of automation technologies in supply chain and logistics. The transportation & logistic sector is huge as well as competitive in the U.S. and consists of distinct industries such as railroads, air services, and shipping.
Factors such as increase in urbanization, rise in traffic congestion, and digital revolution in the transportation sector are projected to drive the expansion of the market in the U.S., as a result of rising adoption of SCM solutions in transportation management.
Why is Demand for Supply Chain Management Increasing in Germany?
Demand for supply chain management platforms in Germany is expected to account for a revenue share of 22.2% by 2021 end. As Europe’s largest economy, Germany has a well-established industrial sector and is a dominant producer of chemicals, machinery, and automobiles.
The country also is recognized for its high-tech manufacturing potential and superior quality of products, due to considerable investments within educational, and research and development avenues.
Moreover, logistic distributors for Fast Moving Consumer Goods (FMCGs) are expanding their warehouse spaces to contain just-in-time deliveries. Investments in the technology industry are projected to have a substantial impact on logistics. Thus, several industrial developments and advancements in Germany are expected to favorably impact the country’s supply chain management market.
How will the Demand for Supply Chain Management Solutions unfold in India?
The demand in India is estimated to exhibit tremendous growth of around 20% CAGR between 2021 and 2031. India’s supply chain and logistics sector is one of the largest globally. The sector has the potential to grow multifold. One of the biggest revelations of the pandemic for this sector is the urgent need to leverage disruptive technologies for greater resilience.
In India, the pandemic has accelerated digital adoption on the demand side. This stemmed from the unprecedented demand faced by online grocery providers, which forced them to limit access for existing consumers in April and May 2020. These disruptive events pushed decision-makers to reimagine the country’s supply chain management.
How is Japan Contributing towards the Supply Chain Management (SCM) Sales?
Demand for supply chain management solutions in Japan is estimated to account for a total sale of US$ 1.28 Bn by the end of 2021. Japan is trying to improve its supply chain security amidst the pandemic while maintaining a positive economic engagement with China, as China is also a large market for Japanese firms.
Even before the coronavirus pandemic Japanese companies had started shifting their production away from China due to the impacts of the U.S.-China trade war.
As a long-time world leader in manufacturing, the perspectives and actions of Japanese companies are heavily influenced by the need to source components and materiel from "lower-cost countries" — long-time venues such as China, as well as emerging sources such as Brazil, Russia and India.
Why is the Demand for Integrated SCM Platform/Suite Continuously Rising?
Based on software, integrated supply chain management platform/suite is expected to contribute nearly 54.1% of the overall share in 2021. A business facilitates relationships with all of its suppliers and manages all distribution and logistics activities through a centralized system rather than having multiple systems within the organization.
Concentrated professional expertise and cost efficiency are core benefits of the integrated supply chain process. This centralized approach leads to more streamlined and efficient activities, as well as implementation of best industry practices in supply chain functions. Development of supplier relationships, acquisition of goods, storage, logistics and transportation are among the primary activities managed in an integrated supply chain.
Why are Cloud-Based SCM Solutions Most Preferred?
The cloud-based deployment segment is projected to register a high demand at a CAGR of 14.2% over the coming years. Cloud computing is quickly growing to support collaborative transportation management solutions and other aspects of transportation management, such as sourcing of network capacity, robust visibility and event management, and ancillary functions, including freight pay and audit.
Applying cloud-based business analytics and manufacturing intelligence allows manufacturing cycle times to improve, hence boosting supply chain management.
Large Enterprises Likely to Use Supply Chain Management Solutions on a Larger Scale than SMEs
The large enterprises segment accounted for 59.7% of the overall market share in 2020, and is expected to continue its dominance during the forecast period. The growing demand for robust monitoring solutions and automation capabilities for resource allocation and strategic decision-making are key factors contributing towards the segment’s growth.
Furthermore, significant rise in need for software in large businesses to assist in the collection of key business data such as inventory levels, projected sales numbers, supplier information, and others from diverse sources drives the growth of the market.
How is Application in Retail & Consumer Goods Sector Supporting Growth?
The retail & consumer goods segment is expected to contribute towards 26.1% of sales in 2021 and is expected to maintain its dominance in the forthcoming years. This can be attributed to the surge in complexity of retail supply chain networks over a period of time due to the presence of large number of suppliers & logistics providers, channels, products, and value-added offerings.
The retail industry is being challenged with a sluggish economy, declining in-store sales, and margins, rising labor costs. Hence, most of the key players are adopting cloud-based technologies to transform their supply chains with unprecedented visibility and insights from data.
The supply chain management market (SCM) is highly concentrated and controlled by dominant players, like
- Oracle Corporation
- SAP SE
- Descartes Systems Group Inc.
- Infor Inc.
- IBM Corporation.
These businesses are leveraging strategic collaborative initiatives to strengthen their market shares and enhance their profitability. However, with product innovations and technological advancements, midsize to smaller firms are growing their market presence by securing new contracts and tapping new markets.
- In June 2021, at its global SAPPHIRE NOW conference, SAP unveiled the first step toward creating the world’s largest business network with SAP Business Network, which will bring together Ariba Network, SAP Logistics Business Network and SAP Asset Intelligence Network. To support this central announcement, SAP is also announcing new innovations designed to help companies modernize and digitalize their business processes to become intelligent enterprises.
Scope of Report
Historical Data Available for
US$ Million for Value
Key Regions Covered
North America, Latin America, Europe, East Asia, South Asia & Pacific, and the Middle East & Africa
Key Countries Covered
US, Canada, Germany, U.K., France, Italy, Spain, Russia, China, Japan, South Korea, India, ASEAN, Australia & New Zealand, GCC Countries, Turkey, and South Africa
Key Segments Covered
Solution, Deployment, Enterprise Size, Industry, and Region
Key Companies Profiled
Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives
Customization & Pricing
Available upon Request
Supply Chain Management Outlook by Category
- Integrated SCM Platform/Suite
- Standalone Solutions
- Supply Chain Planning
- Warehouse Management Software
- Transportation Management Software
- Sourcing & Procurement
- Order Management
- Outsource Supply Chain Management Services
- Professional Services
- Integration & Implementation
- Support & Maintenance
- Consulting Services
By Enterprise Size:
- Small and Medium Enterprises (SMEs)
- Large Enterprises
- Retail & Consumer Goods
- Healthcare & Pharma
- Food & Beverages
- Transportation & Logistics
- North America
- Latin America
- East Asia
- South Asia & Pacific
- Middle East and Africa (MEA)