Warehouse Management System Market Size, Share & COVID-19 Impact Analysis, By Deployment (Cloud and On-premise), By Type (Standalone, Enterprise Resource Planning Module, and Supply Chain Module), By Industry (Discrete Industries, Process Industries, and Others), and Regional Forecast, 2022-2029

The global warehouse management system market size was valued at USD 3.50 billion in 2021. The market is projected to grow from USD 3.89 billion in 2022 to USD 9.14 billion by 2029, exhibiting a CAGR of 13.0% during the forecast period. Based on our analysis, the global market exhibited an average growth of 10.1% in 2020 as compared to 2019.

A Warehouse Management System (WMS) is a solution that helps businesses in increasing visibility in supply chain operations and inventory across all the store shelves from the distribution center. The system manages and tracks the product till it reaches the end customer. Thus, industries focused on customer services are significantly investing in the system. Similarly, the ease of integrating the modules such as enterprise resource planning and supply chain is further expected to boost market share. Also, the key players are offering industry-specific solutions to cater to the rapidly growing need for warehouse management and inventory. For instance,

• In January 2022, Tecsys Inc. launched Elite Healthcare supply chain software to integrate inventory management for the clinical lab environment. This software platform forms clinical supply chain best practices and process optimization, helping clinical labs to grab the most common inventory challenges.

COVID-19 IMPACT

Significant Changes in Demand Cycle Across Industries Amid Pandemic to Boost Market Growth

The pandemic has significantly impacted the operational activities of all industries. Organizations shifted to online solutions and implemented warehouse solutions with the support of cloud-based technologies. These cloud-based solutions save costs with a lower initial investment, boost implementation time, and enhance scalability and flexibility in adapting to business variations and growth. The increasing implementation of digital technologies such as digitization, automation, and cloud across manufacturing industries amid the COVID-19 pandemic is boosting the global market.

The swift rise in the e-commerce sector and increased awareness among companies about warehouse solutions supported the market expansion. Further, the pandemic accelerated the industry's adoption of warehouse automation tools to enhance business operations. Similarly, businesses implemented the system to track end-to-end operations from product entry to order delivery. For instance,

• In November 2022, Manhattan Associates Inc. collaborated with Alliance Automotive Group, an independent truck and automotive parts distributor, to provide Manhattan Active Warehouse Management and Manhattan Active Transportation Management to its customers, improving the experience and reducing order processing time.

Thus, to manage the change in the supply and demand chain, businesses significantly invested in warehouse management systems amid the pandemic.

LATEST TREND

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Introduction of Smart Devices to Increase Sale of WMS

Several types of smart devices, comprising smart tablets, mobile phones, and handheld devices, such as readers, scanners, and tags, are utilized in warehouse management to make the procedure easy. Tablets and smartphones make data inflowing and delivery easy. Once the device connects to a warehouse management system, operators can rapidly post details, such as picklists and shipping labels, from anywhere. In addition, handheld devices such as barcode scanners maintain accurate inventory counts and scan the inventory.

In 2020, according to the U.S. Bureau Of Labor Statistics report, a rough estimation of at least five workplace injuries for every 100 full-time workers in the warehouse/storage industry. Thus, smart devices equipped with Wi-Fi, RFID technology, and cameras are used to minimize the injuries experienced by workers and make warehouse staff work effectively.

Thus, with the advancement in smart devices, the demand for the system is expected to gain traction.

DRIVING FACTORS

Rapid Growth in e-Commerce to Drive the Market Growth

Rising demand from e-commerce organizations for warehouses with better forecasting and monitoring is expected to propel the market growth. The growing e-commerce sector needs constant inventory and equipment tracking to maintain the demand and significant cargo movement. It records and tracks inventories, goods, and orders; manages the shelf, bin, and pallet locations; and maintains a better returns record. For instance,

• In January 2022, FedEx and Microsoft Corporation launched a new cross-platform logistics solution for e-commerce. This new offering in the e-commerce platform enables customer engagement and provides enhanced shipping options to the users.

The demand for e-commerce products frequently varies, which results in a large number of backorders. Automating the procedure for proper distribution, packaging, and dispatch of orders is crucial. Thus, the demand for WMS is growing with the e-commerce industry.

Adoption of Digital Technologies in Supply Chains to Fuel Market Share

Digital technology is helping warehouse management is various applications. The always-on e-commerce industry is significantly investing in digital solutions to enhance responses speed with fewer errors. According to the MHI Annual Industry Report, 2021, almost 80% of respondents agreed that the digital supply chain will grow in future. The real-time data offered through digital technologies is further expected to fuel the warehouse management system to track the overall supply chain process.

The interconnection between warehouse, supply chain, and the consumer is likely to fuel digitalized warehouse management systems. Digital technologies such as artificial intelligence, Internet of Things, digital twin, and more have surged the demand for smart warehousing techniques. Thus, with the adoption of digitalization in the supply chain, the demand for warehouse management system is expected to gain traction.

RESTRAINING FACTORS

High Installation Costs and Lack of Technical Expertise to Hinder Market Growth

Warehouse management software integration can be time-consuming and permitting authorized access to workers may risk the privacy of company's data. In addition, small and medium-sized organizations' lack of awareness about the systems can challenge various manufacturers.

Furthermore, several limitations comprise higher installation costs associated with the on-premise and the requirement of a significant initial investment to hinder the market growth.

SEGMENTATION

By Deployment Analysis

Ease of Module Integration to Fuel Cloud-based System Demand

By deployment, the market is bifurcated into cloud and on-premise. Cloud segment is expected to gain the highest CAGR during the forecast period. It offers real-time data transfer to support quick business operations. The demand for cloud is growing considering the increase in supply chain and enterprise resource planning integration with the system is easy. According to the Warehouse Logistics 2020 report, more than half of WMS providers are offering cloud-based warehouse management systems. 

On-premises WMS deployment is observing stable demand amid the rise of cloud solutions along with their enhanced capabilities. Majorly, small enterprises are investing in on-premises considering its in-house safety and easy management.

By Type Analysis

Growing Demand for Inventory Capabilities to Boost Supply Chain Module Growth

Based on type, the market is bifurcated into standalone, enterprise resource planning module, and supply chain module.

Supply chain module segment is expected to gain maximum segment share during the forecast period. The increasing complexities in supply chains are driving the adoption of the system. The integrated supply chain module helps in managing inventory at an optimum level.

The enterprise resource planning module segment is expected to witness a rapid growth rate over the forecast period. The integration helps in unifying the internal business, which helps in scaling revenue growth.

Similarly, the standalone segment is likely to showcase a steady growth rate during the forecast period owing to the growing demand for advanced storage and logistics solutions across small and medium enterprises.

By Industry Analysis

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Growing Focus Efficient Business Process to Surge Discrete Industries CAGR

Based on industry, the market is split into discrete industries, process industries, and others.

Discrete industries segment witnessed rapid growth rates and is expected to be the dominant segment during the forecast period. These industries are focused on enhancing logistics speed and delivery accuracy to optimize business growth. Thus, growing demand for advanced warehouse management solutions to maintain business operations will boost the warehouse management system market share.

The process industries segment is expected to gain a steady growth rate during the forecast period. The industry players are offering specifically industry-based solutions to cater to the unique requirements in warehouse operations of process industries such as chemical, pharmaceutical, food & beverages, and more.  

REGIONAL INSIGHTS

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In terms of region, the market is divided into North America, Europe, South America, Asia Pacific, and the Middle East & Africa. They are further segmented into countries.

North America is likely to dominate the global market during the forecast period. The logistics industry in the U.S. accounts for about 10.0% of the total GDP and was expected to reach around USD 175.0 trillion in 2022. As the logistics industry is witnessing growth, the demand for warehouse tools will also increase in the coming years.

Asia Pacific is expected to showcase rapid growth rate during the forecast period. The major factors for the region's growth due to the evolving industry verticals, including BFSI, manufacturing, transportation management, and logistics. Several key vendors in the region are focusing on developing and introducing advanced warehouse management system solutions to cater to the rising demand for resilient supply chain operations among these verticals.

The Europe market is driven by the substantial rise of industry 4.0 and IoT. According to the Federal Statistical Office of Germany, the increasing need for effective production process management and the early adoption of automation resulted in 82.0% of large organizations utilizing supply chain management solutions likely to fuel the warehouse management system demand.

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The rapid growth in digital solutions in industries in South America and increasing focus on on-time deliveries to meet the customer expectation is likely to surge WSM market share in the region. Similarly, growing investments in logistics and supply chains in the Middle East and Africa boost the market growth.

KEY INDUSTRY PLAYERS

Focus on Business Expansion to Fuel Key Players Market Share

The top players are focused on expanding across global boundaries by introducing industry-specific solutions. These players are strategically collaborating and acquiring local players to gain strong grip in the regions. The market players aim to develop their products based on emerging technologies such as Artificial Intelligence (AI), IoT, cloud, and others to solve the issues faced by the companies.

List of the Key Companies Profiled:

• Microsoft Corporation (U.S.)


• Oracle Corporation (U.S.)


• Infor Inc. (U.S.)


• SAP SE (Germany)


• Manhattan Associates, Inc. (U.S.)


• Korber AG (Germany)


• Fishbowl Inventory (U.S.)


• Tecsys Inc. (Canada)


• 3PL Central LLC (U.S.)


• Infoplus Commerce (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• June 2022: Made4net, a global cloud-based warehouse management system software provider, launched SCExpert software. This software equips users to rapidly adapt to changing market and customer requirements.


• July 2022: Infor announced that Q&L Industrial Services, a logistics provider in Slovakia, is transforming to Infor WMS cloud solution to increase the performance of stock operations. Q&L provides help in speed and accuracy for its consumers.


• June 2022: Korber collaborated with GXO Logistics Inc., a logistics provider, to develop an AI-based solution to boost warehouse efficiency. It captures errors in real-time and autonomously reduces downtime and human intervention in picking.


• December 2021: 3PL Central acquired CartRover to integrate WMS, OMS, and integration platforms with 3PL Central to connect the supply chains from the shipping cart to the warehouse.


• May 2020: SAP SE launched 9.3 versions of SAP® - Transportation Management and the SAP Extended Warehouse Management. This release helps supply chain managers by decreasing costs and growing efficiency through faster order fulfillment and logistics and improved utilization of assets.

REPORT COVERAGE

An Infographic Representation of Warehouse Management System (WMS) Market

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The study on the market includes prominent areas worldwide to get a better knowledge of the industry. Furthermore, the report provides insights into the most recent industry and warehouse management system market trends, as well as an analysis of technologies that are being adopted quickly worldwide. It also emphasizes some of the growth-stimulating restrictions and elements, allowing the reader to obtain a thorough understanding of the industry.

REPORT SCOPE & SEGMENTATION