SYNOPSIS: Supply Chain Management Market Research Report 2033
Mark Vernall
Logistics/Supply Chain Specialist, SC SME - SC Project Management - SC Consulting - SC Advisor - SC System Implementation - Supplier Relationship Management - SC Digital Transformation - SC Solution Design - SC Jedi
Introduction
This chapter provides an overview of supply chain management (SCM) and its key concepts. Here are the salient points:
o Definition of SCM: SCM is defined as a set of approaches to efficiently integrate suppliers, manufacturers, warehouses, and stores to produce and distribute merchandise in the right quantities, to the right locations, and at the right time while minimizing system-wide costs and satisfying service level requirements.
o SCM Activities: SCM involves managing flows of products, information, and funds across the supply chain. It encompasses activities like procurement, production, distribution, and customer service.
o Supply Chain Flows: There are three main flows in a supply chain - product flow, information flow, and funds flow. Effective management of these flows is crucial.
o The Bullwhip Effect: This refers to the phenomenon where demand variability increases as one moves up the supply chain, leading to inefficiencies like excessive inventory, poor product forecasting, and high costs.
o Customer Focus: SCM emphasizes a customer-centric approach, aiming to provide the right product, at the right time, in the right quantity, and at the right cost.
o Boundary-Spanning Nature: SCM requires integration within an organization (intra-organizational) and across organizations (cross-enterprise).
o SCM vs. Logistics: Logistics is a subset of SCM, focusing on the movement and storage of products, while SCM has a broader scope, encompassing all activities from sourcing to delivery.
o Rise of SCM: The rise of SCM is driven by factors like globalization, outsourcing, technological advancements, and the need for cost-effective and responsive supply chains.
o Characteristics of a Competitive Supply Chain: Key characteristics include responsiveness, reliability, and effective relationship management.
o Trends in SCM: Major trends shaping SCM include globalization, outsourcing, technology adoption, postponement, lean practices, supply chain disruptions, security concerns, sustainability, innovation, and financial supply chain management.
The chapter provides a comprehensive introduction to SCM, setting the foundation for understanding its importance, activities, flows, and emerging trends in today's global business environment.
Executive Summary
The executive summary provides a concise overview of the key findings and recommendations from the report, what follows are the salient points.
o Market Overview: The global supply chain management market was valued at $27.2 billion in 2022 and is projected to reach $85.3 billion by 2033, growing at a CAGR of 11.1%. This growth is driven by increasing demand for efficient supply chain operations, technological advancements, and adoption across various industries.
o Market Segmentation by Component: The solution segment held the largest share in 2022 due to the growing demand for supply chain management software solutions.
o Solution Type: The procurement and sourcing segment dominated in 2022, reflecting the importance of efficient procurement processes.
o Deployment Mode: The on-demand/cloud-based segment is expected to witness the fastest growth during the forecast period, driven by scalability and cost-effectiveness.
o Enterprise Size: The SME segment is projected to grow at the highest CAGR as SMEs increasingly adopt supply chain management solutions.
o Industry Vertical: The retail and consumer goods segment held the largest share in 2022, owing to complex supply chain requirements.
o Regional Analysis: North America held the largest market share in 2022, attributed to advanced technological infrastructure and high adoption.
Asia-Pacific is expected to witness the highest CAGR during the forecast period, driven by increasing investments and adoption.
o Key Players and Strategies: The report highlights key players like IBM, Blue Yonder, Kinaxis, Manhattan Associates, Oracle, SAP, Epicor, HighJump, Infor, and Descartes Systems Group. These players are adopting strategies such as collaboration, partnerships, and product development to strengthen their market position.
Actionable Recommendations
The executive summary provides a comprehensive overview of the supply chain management market, including its size, growth drivers, segmentation, regional analysis, key players, and actionable recommendations for supply chain managers and practitioners.
Market Overview
This chapter provides an in-depth analysis of the supply chain management market, including market segmentation, regional analysis, and key trends shaping the industry.
Market Segmentation
The market is segmented based on various factors, providing insights into the growth potential and demand dynamics of different segments.
o Component: The solution segment held the largest market share in 2022, driven by the increasing demand for supply chain management software solutions to streamline operations and enhance efficiency.
o Solution Type: The procurement and sourcing segment dominated the market in 2022, highlighting the importance of efficient procurement processes in supply chain management.
o Deployment Mode: The on-demand/cloud-based segment is expected to witness the fastest growth during the forecast period from 2023 to 2033, attributed to the scalability, cost-effectiveness, and real-time data access offered by cloud-based solutions.
o Enterprise Size: The small and medium-sized enterprise (SME) segment is projected to grow at the highest CAGR, as SMEs increasingly adopt supply chain management solutions to gain a competitive edge and streamline their operations.
o Industry Vertical: The retail and consumer goods segment held the largest market share in 2022, owing to the complex supply chain requirements of this industry, including managing inventory, logistics, and distribution channels effectively.
o Regional Analysis: The report provides insights into the regional dynamics of the supply chain management market, highlighting the leading regions and growth opportunities. North America held the largest market share in 2022, attributed to the region's advanced technological infrastructure and high adoption of supply chain management solutions across various industries.
Asia-Pacific is expected to witness the highest growth rate during the forecast period from 2023 to 2033, driven by increasing investments, mergers and acquisitions, and the adoption of supply chain management solutions in the region.
Key Trends and Drivers
The chapter also explores the key trends and drivers shaping the supply chain management market, including:
The market overview chapter provides a comprehensive analysis of the supply chain management market, enabling supply chain managers and practitioners to understand the market dynamics, identify growth opportunities, and make informed decisions for their organizations.
Markets by Component
This chapter delves into the segmentation of the supply chain management market based on the component, providing insights into the performance and growth potential of different segments.
Solutions
The solutions segment held the largest market share in 2022, accounting for a significant portion of the overall supply chain management market. The growing demand for supply chain management software solutions to streamline operations and enhance efficiency is the primary driver for the dominance of this segment.
The solutions segment includes various modules and functionalities, such as;
o Transportation Management System
o Warehouse and Inventory Management System
o Supply Chain Planning and Analytics
o Procurement and Sourcing
o Manufacturing Execution System
Services
The services segment includes professional services and managed services.
Key Trends and Drivers
Competitive Landscape
The report highlights the key players operating in the supply chain management market, including IBM Corporation, Blue Yonder Group, Inc., Kinaxis, Manhattan Associates, Inc., Oracle Corporation, SAP SE, Epicor Software Corporation, HighJump, Infor, and THE DESCARTES SYSTEMS GROUP INC.
These players are adopting strategies such as collaboration, partnerships, and product development to strengthen their market position and cater to the evolving needs of supply chain managers and practitioners.
By understanding the market segmentation by component, supply chain managers can identify the growth opportunities, evaluate the performance of different solution and service offerings, and make informed decisions to enhance their supply chain operations.
Markets by Solution Type
This chapter delves into the segmentation of the supply chain management market based on the different solution types, providing insights into the performance and growth potential of each segment.
Solution Type
o Procurement and Sourcing: The procurement and sourcing segment dominated the supply chain management market in 2022, reflecting the importance of efficient procurement processes in supply chain operations.
Procurement and sourcing solutions enable organizations to streamline their supplier management, contract negotiation, and strategic sourcing activities, leading to cost savings and improved supply chain efficiency.
o Supply Chain Planning and Analytics: The supply chain planning and analytics segment is expected to witness significant growth during the forecast period, driven by the increasing need for advanced demand forecasting, inventory optimization, and supply chain visibility.
These solutions leverage data analytics, machine learning, and artificial intelligence to help organizations make informed decisions, improve supply chain resilience, and enhance overall operational performance.
o Warehouse and Inventory Management: The warehouse and inventory management segment is a crucial component of the supply chain management market, as it enables organizations to optimize their storage, distribution, and inventory control processes.
Advancements in technologies like RFID, IoT, and automation are driving the adoption of warehouse and inventory management solutions to improve efficiency and reduce operational costs.
o Transportation Management: The transportation management segment focuses on optimizing the movement of goods, including route planning, fleet management, and shipment tracking, to ensure timely and cost-effective deliveries.
The growing emphasis on last-mile delivery and the need for real-time visibility in transportation are fueling the demand for transportation management solutions.
o Manufacturing Execution System (MES): The manufacturing execution system segment is expected to witness steady growth, as organizations seek to integrate their production processes with their overall supply chain management strategies.
MES solutions help manufacturers improve production efficiency, quality control, and compliance, ultimately enhancing the overall supply chain performance.
Key Trends and Drivers
By understanding the market segmentation by solution type, supply chain managers can identify the growth opportunities, evaluate the performance of different solution offerings, and make informed decisions to enhance their supply chain operations.
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Markets by Deployment Mode
Deployment Mode
o On-Premises: The on-premises segment held a larger market share during the forecast period, as many organizations, particularly in highly regulated industries, prefer to maintain control over their supply chain data and operations by deploying on-premises solutions
On-premises supply chain management solutions offer greater customization and integration capabilities, which are crucial for enterprises with complex supply chain requirements.
o Cloud-Based/On-Demand: The cloud-based/on-demand segment is expected to witness the fastest growth during the forecast period, driven by the scalability, cost-effectiveness, and real-time data access offered by cloud-based supply chain management solutions.
Cloud-based solutions enable organizations to quickly adapt to changing market conditions and scale their supply chain operations as needed, without the need for significant upfront investments in IT infrastructure.
Key Trends and Drivers
Competitive Landscape
The report highlights the key players operating in the supply chain management market, including IBM Corporation, Blue Yonder Group, Inc., Kinaxis, Manhattan Associates, Inc., Oracle Corporation, SAP SE, Epicor Software Corporation, HighJump, Infor, and THE DESCARTES SYSTEMS GROUP INC.
These players are adopting strategies such as collaboration, partnerships, and product development to strengthen their market position and cater to the evolving needs of supply chain managers and practitioners, including the deployment mode preferences.
By understanding the market segmentation by deployment mode, supply chain managers can identify the growth opportunities, evaluate the performance of different deployment options, and make informed decisions to enhance their supply chain operations based on their specific requirements and constraints.
Markets by Enterprise Size
his chapter delves into the segmentation of the supply chain management market based on the enterprise size, providing insights into the performance and growth potential of different segments.
Enterprise Size
o Large Enterprises: The large enterprise segment held the largest market share in 2022, accounting for nearly two-thirds of the overall supply chain management industry revenue.
Large enterprises have a greater need for constant monitoring systems and automation features to manage the complexity of their supply chain operations, driving the adoption of supply chain management solutions in this segment.
Large enterprises are also better equipped to invest in advanced supply chain management technologies and have the resources to implement comprehensive solutions across their operations.
o Small and Medium-Sized Enterprises (SMEs): The SME segment is projected to grow at the highest CAGR during the forecast period, as SMEs increasingly adopt supply chain management solutions to gain a competitive edge and streamline their operations.
The rising adoption of cloud-based and on-demand supply chain management solutions has made these offerings more accessible and affordable for SMEs, enabling them to leverage the benefits of advanced supply chain management capabilities.
The World Bank Organization estimates that SMEs account for the majority of businesses globally and contribute around 50% of employment, further driving the growth of the SME segment in the supply chain management market.
Key Trends and Drivers
Competitive Landscape
The report highlights the key players operating in the supply chain management market, including IBM Corporation, Blue Yonder Group, Inc., Kinaxis, Manhattan Associates, Inc., Oracle Corporation, SAP SE, Epicor Software Corporation, HighJump, Infor, and THE DESCARTES SYSTEMS GROUP INC.
These players are adopting strategies such as collaboration, partnerships, and product development to strengthen their market position and cater to the evolving needs of supply chain managers and practitioners, including the enterprise size preference.
By understanding the market segmentation by enterprise size, supply chain managers can identify the growth opportunities, evaluate the performance of different solution offerings for large enterprises and SMEs, and make informed decisions to enhance their supply chain operations based on their organizational size and requirements.
Markets by Industry Vertical
This chapter delves into the segmentation of the supply chain management market based on different industry verticals, providing insights into the performance and growth potential of each segment.
Industry Vertical
o Retail and Consumer Goods: The retail and consumer goods segment held the largest market share in 2022, accounting for a significant portion of the overall supply chain management market.
The complex supply chain requirements of the retail and consumer goods industry, including managing inventory, logistics, and distribution channels effectively, have driven the adoption of supply chain management solutions in this sector.
The rise of e-commerce and the subsequent demand for efficient last-mile delivery solutions have further contributed to the growth of the retail and consumer goods segment in the supply chain management market.
o Healthcare and Pharmaceuticals: The healthcare and pharmaceuticals segment is expected to witness substantial growth during the forecast period, driven by the need for efficient supply chain management to ensure the timely delivery of critical medical supplies and pharmaceuticals.
Supply chain management solutions in the healthcare and pharmaceuticals industry focus on areas such as cold chain logistics, serialization, and traceability to comply with regulatory requirements and maintain product integrity.
o Manufacturing: The manufacturing segment is a key contributor to the supply chain management market, as manufacturers rely on efficient supply chain operations to optimize production, inventory, and distribution processes.
The integration of advanced technologies, such as the Industrial Internet of Things (IIoT) and automation, is driving the adoption of supply chain management solutions in the manufacturing industry to enhance visibility, flexibility, and responsiveness.
o Food and Beverages: The food and beverages segment is expected to witness steady growth, as supply chain management solutions help organizations in this industry manage the complexities of perishable goods, cold chain logistics, and traceability requirements.
The increasing focus on sustainability and the reduction of food waste are also driving the adoption of supply chain management solutions in the food and beverages industry.
o Transportation and Logistics: The transportation and logistics segment is a key user of supply chain management solutions, as these solutions enable organizations to optimize their transportation networks, fleet management, and delivery operations.
The growing emphasis on last-mile delivery and the need for real-time visibility in transportation are fueling the demand for supply chain management solutions in this industry.
Key Trends and Drivers
By understanding the market segmentation by industry vertical, supply chain managers can identify the growth opportunities, evaluate the performance of different solution offerings for various industries, and make informed decisions to enhance their supply chain operations based on their specific industry requirements.
Markets by Region
This chapter provides a comprehensive analysis of the supply chain management market across different geographical regions, highlighting the key trends, growth drivers, and competitive landscape in each region.
Regional Analysis
o North America: North America held the largest market share in 2022, accounting for a significant portion of the global supply chain management market. The region's dominance is attributed to the advanced technological infrastructure, high adoption of supply chain management solutions, and the presence of major industry players in the United States and Canada.
The United States is the largest contributor to the North American supply chain management market, driven by the increasing demand for efficient supply chain operations across various industries, including retail, manufacturing, and healthcare.
o Europe: Europe is the second-largest market for supply chain management solutions, with a strong presence of both global and regional players. The region is characterized by a high level of automation, digitalization, and the adoption of advanced technologies, such as the Industrial Internet of Things (IIoT) and artificial intelligence, to optimize supply chain operations.
Key countries contributing to the European supply chain management market include Germany, the United Kingdom, France, and Italy, driven by the increasing focus on sustainability and the development of green supply chain practices.1
o Asia-Pacific: The Asia-Pacific region is expected to witness the highest growth rate during the forecast period, driven by the increasing investments, mergers and acquisitions, and the adoption of supply chain management solutions in countries like China, India, Japan, and South Korea.
The region's rapidly growing e-commerce industry, coupled with the need for efficient last-mile delivery and logistics, is a significant driver for the adoption of supply chain management solutions.
Governments in the Asia-Pacific region are also actively promoting the development of smart cities and Industry 4.0 initiatives, which are expected to further drive the demand for advanced supply chain management solutions.
o Latin America: The Latin American supply chain management market is expected to witness steady growth, driven by the increasing adoption of supply chain management solutions in countries like Brazil, Mexico, and Argentina.
The region's focus on improving infrastructure, reducing logistics costs, and enhancing supply chain visibility is driving the demand for supply chain management solutions.
o Middle East and Africa: The Middle East and Africa region is the smallest market for supply chain management solutions, but it is expected to experience moderate growth during the forecast period.
The region's focus on diversifying its economies, improving infrastructure, and developing industrial sectors, such as manufacturing and logistics, is driving the adoption of supply chain management solutions.
Competitive Landscape
The report highlights the key players operating in the supply chain management market across different regions, including IBM Corporation, Blue Yonder Group, Inc., Kinaxis, Manhattan Associates, Inc., Oracle Corporation, SAP SE, Epicor Software Corporation, HighJump, Infor, and THE DESCARTES SYSTEMS GROUP INC.
These players are adopting strategies such as collaboration, partnerships, and product development to strengthen their market position and cater to the evolving needs of supply chain managers and practitioners in different geographical regions.
By understanding the market segmentation by region, supply chain managers can identify the growth opportunities, evaluate the performance of different solution offerings in various markets, and make informed decisions to enhance their supply chain operations based on the specific regional dynamics and requirements.
Key Actionable Recommendations
o Leverage Cloud-based Solutions: Supply chain managers should consider adopting cloud-based supply chain management solutions to benefit from scalability, cost-effectiveness, and real-time data access. The on-demand/cloud-based segment is expected to witness the fastest growth during the forecast period.
o Target the SME Segment: Supply chain solution providers should focus on the small and medium-sized enterprise (SME) segment, as it is projected to grow at the highest CAGR. SMEs are increasingly adopting supply chain management solutions to streamline operations and gain a competitive edge.
o Prioritize the Retail and Consumer Goods Industry: Supply chain solution providers should prioritize the retail and consumer goods industry, as it held the largest market share in 2022 and has complex supply chain requirements. Leveraging supply chain management solutions can help organizations in this industry optimize their inventory, logistics, and distribution processes.
o Explore Opportunities in Asia-Pacific: Supply chain companies should explore the Asia-Pacific region, as it is expected to witness the highest growth rate during the forecast period, driven by increasing investments and the adoption of supply chain management solutions.
o Integrate AI and Machine Learning: Supply chain managers should consider integrating AI and machine learning technologies into their supply chain operations to improve efficiency, demand forecasting, inventory management, and logistics optimization.
o Adopt Smart Container Solutions: Supply chain companies should explore the adoption of smart container solutions, as this market is projected to reach $24.1 billion by 2032, growing at a CAGR of 19.8%.
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