ResearchAndMarkets Sees Supply Chain Management (SCM) Software Global Market CAGR of 13.5%

August 25, 2021

ResearchAndMarkets has forecast he global SCM software market growing from $17.51 billion in 2020 to $18.96 billion in 2021 at a compound annual growth rate (CAGR) of 8.3%. The market is expected to reach $31.48 billion in 2025 at a CAGR of 13.5%.

Major players in the SCM software market are SAP, Oracle, JDA Software Group, Inc., Infor Global Solutions and, Manhattan Associates.

The supply chain management (SCM) software market consists of sales of supply chain management software. The SCM software manages the flow of products and information across the supply chain, thereby strengthening the supply chain operations in an organization. Softwares such as SCMs are used to bring equilibrium between supply and demand by improving business processes and plan the future needs by using algorithms which provides consumption analysis.

Supply chains are continuously evolving with data at the center of every stage in the value chain. With a huge amount of data generated, there is an enormous challenge in the form of data and IT security risks. Protecting the privacy and still sharing data across the supply chain is a major challenge which could become a roadblock for the SCM software industry.

SCM software's can manage the complexities of the modern day supply chain. With businesses going global and increased competition, the supply chains are getting complex. The number of suppliers, orders received/completed, variety of product offerings, information generated etc. all have increased substantially. Through the use of SCM software, the complexity can be reduced along with cost and resource savings. The need for companies to remain relevant in the market amidst the highly competitive conditions is a crucial driver for the growth of the SCM software market.

Home Depot, one of the biggest retailers selling home improvement and construction products and services used to have separate logistics management departments in every single physical store to utilize replenishment and store management-related activities. This was costly as each store had to process the replenishment orders to get the required materials from the suppliers separately. After realizing that the de-centralization of the logistics management was a major issue.

Home Depot decided to centralize those individual departments into one department in its corporate headquarters. With the help of technology and right SCM software solutions, Home Depot's new centralized inventory and replenishment department's overall performance improved the demand forecast accuracy and decreased the cost of operations for the replenishment orders.

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