Trade Management Software Market Size, Share & COVID-19 Impact Analysis, By Function (Trade Compliance, Custom Management, Finance Management, Trade Analytics, Others), By Deployment (Cloud, On-premise), By Enterprise Size (SMEs, Large Enterprises), By Industry (Automotive, Healthcare & Life Sciences, Manufacturing, Transportation & Logistics, IT & Telecom, Retail & Consumer Goods and Products, Others), and Regional Forecast, 2022-2029

The global trade management software market size was valued at USD 1.11 billion in 2021. The market is projected to grow from USD 1.19 billion in 2022 to USD 2.38 billion by 2029, exhibiting a CAGR of 10.5%. North America dominated the global market with a share of 39.55% in 2021.

Based on our analysis, the global market exhibited an average growth of 5.4% in 2020 as compared to 2019. Trade management software enables organizations to manage trade-related operations such as trade compliance, import/export management, custom filings, restricted party screening, free trade zone, and cross-border trade management. It enables companies to gain trade visibility, control shipments and orders, and ensure adherence to trade regulations.

In the market study, we have considered solutions offered by market players such as SAP SE offers, SAP Trade Management and SAP Global Trade Services (GTS), and Oracle Corporation’s Oracle Global Trade Management, among others. Similarly, Thomson Reuters offers ONESOURCE Global Trade and QAD’s QAD Precision software for import and export compliance, free trade agreements, automated restricted party screening, and foreign trade zone management.

The market forecast can be attributed to several factors, including rising international trade activities due to globalization. Besides, the increasing demand for automation across trade management operations creates new opportunities for the trade management software market growth.

COVID-19 IMPACT

International Trade Disrupted Industry Growth During the Pandemic

The COVID-19 pandemic has disrupted international trade. Governments of various countries have implemented restrictions related to international transport and trade to avoid the spread of the coronavirus. Such restrictions and social distancing measures have caused interruptions to the supply chain and international trade.

In the first quarter of 2020, global trade in goods and services declined drastically. According to the UNCTAD 2021 report, the value of merchandise trade is projected to fall by 18% in the second quarter of 2020, and trade in services declined by 21%.

Developed economies such as the European Union, the U.S., and China witnessed a significant decline in sales across chemical and automotive industries. Textiles, office machinery, precision instrumentation, and communications equipment have also experienced a sharp decline in trade.

However, COVID-19-related medical products, such as ventilators, personal protective equipment, sanitizers, and thermometers, witnessed a steep growth in the second quarter of 2020. For example,

• In May 2020, according to the World Trade Organization, medical products recorded a sharp growth of 18% higher than in 2019. Other non-medical products, including home office equipment, such as laptops, Wi-Fi routers, portable storage, and others, also experienced positive growth in the second quarter of 2020.

The COVID-19 pandemic accelerated the digital transformation for organizations in all industries, irrespective of size. This accelerated digital transformation is anticipated to foster global trade, commerce, and employment. For instance, according to the Asian Development Bank’s Asian Economic Integration Report 2021, the 20% spike in the size of the digital sector can boost global output by USD 4.3 trillion from 2021 to 2025.

During the COVID-19 pandemic, the market growth was restricted for a short period. However, the market is expected to exhibit notable growth during the forecast period.

LATEST TRENDS

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Increased Adoption of AI, ML, and Predictive Analytics across GTM Solutions to Fuel Market Progress

As the complexities of international trade continue to grow, global software providers are focusing on introducing solutions with advanced technologies such as AI, ML, analytics, and blockchain to help shippers reduce costs and improve speed. For instance,

AI and ML are helping global trade management leaders to strengthen their supply chain operations. It is improving efficiencies in industries from transportation and finance to energy management.

In addition, predictive analytics assist trade professionals in identifying and assessing the impact of trade disruptions such as new or updated trade agreements, regulatory changes, and tariff increases. According to the World Trade Organization, blockchain technology is expected to impact global trade management-related applications such as trade finance, customs and certification processes, and others in industries including insurance, logistics, transportation, intellectual property, and government procurement.

Thus, integrating emerging technologies across the GTM software fosters market growth in the coming years.

TRADE MANAGEMENT SOFTWARE MARKET GROWTH FACTORS

Rising Demand for Automated Trade Management Systems to Boost Market Growth

Global Trade Management (GTM) systems help to automate and centralize trade compliance operations. By streamlining existing business processes and data management, GTM systems assist global trade compliance and customs professionals in managing compliance duties.

Automating global trade compliance and customs management processes represents a significant opportunity to enhance accountability and create a competitive advantage. Companies that have not implemented a GTM system spend more time in manual operations, restricting the accuracy and speed of trade compliance and customs reporting. The software provides free and foreign trade zone functionality, free trade agreement qualification, nation-specific import and export self-filing capabilities, and process management.

The growing adoption of the trade management software to automate operational tasks of import and export, such as documentation generation, license determination, and classification storage, is likely to fuel market growth. As per the Deloitte Global Trade Automation Survey, 54% of respondents stated they are using automated global trade management systems to simplify compliance management.

Similarly, the report stated that companies use a global trade management system to manage import and export activities. 70% of companies are using GTM systems to manage HTS classification storage. In addition, 40% of respondents stated that they are leveraging the GTM system to manage HTS classification determination and Import document generation.

RESTRAINING FACTORS

Organizations Resilient to Change Legacy Systems or Adopt New Technologies

Many organizations rely on traditional supply chain management, enterprise resource planning, and transport management systems to manage their trade operations. Several organizations are using traditional trade management techniques. Lack of skilled professionals and investment to implement digital technologies restricts the adoption of this software across organizations.

Advanced trade analytics solutions require knowledge and skills related to the latest technology such as artificial intelligence, machine learning, and big data analytics. Lack of skills related to advanced technologies is one of the factors restricting market growth. For instance,

In January 2020, a McKinsey & Company report depicted that 87% of companies worldwide would face severe talent shortage. Similarly, according to the Future of Work Report 2022, 87% of companies stated they are facing difficulty finding the right and skilled candidates.

These factors are expected to hamper the market growth in the coming years.

SEGMENTATION

By Function Analysis

Trade Laws and Regulation Changes across Countries Boost Trade Compliance Solutions’ Demand

Based on function, the market is divided into trade compliance, custom management, finance management, trade analytics, and others.

Companies with complex supply chains are expected to fuel the demand for software embedded with functions such as trade compliance and customs management to simultaneously pursue savings opportunities, reduce costs, manage risks, and a seamless cross-border clearance.

The continuously changing customs requirements across nations for import or export is projected to create demand for customs management solutions in the coming years. The integration of advanced technologies, such as analytics and artificial intelligence, drives the market toward a higher growth trajectory.

By Deployment Analysis

Cloud Segment to Dominate Attributable to Strong Demand for Flexible and Cost-Effective Solutions

By deployment, the market is bifurcated into cloud and on-premise. Cloud-based trade management solutions are anticipated to gain traction during the forecast period owing to increased investment by major cloud providers to develop cloud regions across various countries.

Similarly, surge in the adoption of software-as-a-service trade management systems fuels market growth. Cloud-based software provides easy upgradation, easy accessibility, maintenance packages, and flexible pricing models, which is expected to drive the proliferation of cloud-based systems. Also, robust flexibility, scalability, and affordable prices are expected to boost the adoption of cloud-based solutions.

By Enterprise Size Analysis

Large Enterprises to Dominate Attributable to Strong Demand for Efficient Trade Management Software

Based on enterprise size, the market is classified into Small and Medium Enterprises (SMEs) and large enterprises.

The large enterprises segment is expected to hold the major market share owing to the surge in demand for efficient trade management, compliance management, import/export management, and financial management solutions to manage and track the complex supply chain. Large enterprises involved in international trade need to comply with global trade regulations, which is anticipated to create the demand for trade management software.

The small and medium enterprises segment is projected to grow with the highest CAGR owing to growing investment and funding to expand business across countries. SMEs are focusing on adopting cost-effective cloud-based software due to its low cost and pay-per-use pricing model, which is expected to drive market growth.

By Industry Analysis

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Surge in International Trade in Healthcare & Lifesciences and Manufacturing Industry Fuels the Market Growth.

The market is divided into automotive, healthcare & life sciences, manufacturing, transportation & logistics, IT & telecom, retail & consumer goods and products, and others.

The healthcare & life sciences segment is anticipated to grow with maximum CAGR owing to increased international trade across pharmaceutical companies and growing demand for COVID-19 vaccines.

For example, GE Healthcare, a global medical technology company, ships products across 145 locations and has a complex supply chain spanning multiple time zones, regulatory environments, and international borders. Thus, the company leveraged the E2open trade compliance platform to automate the compliance process and reduce operational costs.

The growing import export of consumer goods, petroleum oils, automobiles, raw materials, and capital goods is expected to increase the proliferation of this software across industries.

REGIONAL INSIGHTS

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Geographically, the market is studied across North America, Europe, Asia Pacific, the Middle East & Africa, and South America. They are further categorized into countries.

North America holds the major trade management software market share due to rising trade activities and huge volume of export and imports in the U.S. The market growth is attributed to the U.S. being home to more than a few major market players, including Oracle Corporation, the Descartes Systems Group, E2open LLC, Bamboo Rose, QAD Inc., and Integration Point.

The U.S. is the world’s largest trading country; in 2019, the total imports and exports of goods and services were USD 5.6 trillion. The total of U.S. goods imports from the world in 2019 was more than USD 2.5 trillion. In addition, U.S. exports accounted for USD 1.6 trillion in 2019. The U.S. has trade relations with over 200 countries, regional associations, and territories worldwide.

Further, as per the World Bank estimation, it takes USD 275 per shipment and 9 hours to fill the border compliance requirements and documentary for importing into the U.S. These factors are likely to foster the market in the region.

The Asia Pacific region is expected to grow with maximum CAGR during the forecast period. The emergence of logistics industries and firms is anticipated to drive the regional demand for trade management software.

India signed trade agreements with Asian countries, including Japan, Korea, and ASEAN countries. Over time, importers' use of free trade agreements has grown significantly. The surge in duty-free imports and the subsequent trade deficit has forced the Indian government to introduce anti-abuse procedures to evade the misuse of duty-free access to India's market.

The software assists customers in analyzing the cost reduction opportunities linked to free trade agreements. Such capabilities are expected to boost trade management software adoption in the coming years.

Europe is projected to showcase significant growth during the forecast period. European countries, including Germany, the U.K., the Nordics, and Benelux are anticipated to propel the adoption of trade management software across industries.

According to Eurostat, pharmaceutical products, motor vehicles, machinery, and equipment, were the most exported products/goods from the European Union between 2017 and 2021. In 2021, machinery and equipment exports grew from USD 312.1 billion to USD 332.1 billion in 2021. Thus, the rise in export/import activities creates demand for organizations to comply with trade regulations of European countries and is expected to drive the market growth.

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The Middle East & Africa is expected to grow with a moderate growth rate. The growing adoption of digital technologies and increased network bandwidth are expected to create new market opportunities for growth in the region. South America is anticipated to grow steadily in the forecast period. The market growth is attributed to growing smartphone penetration and internet connection across the region.

KEY INDUSTRY PLAYERS

Key Players Emphasize Building Cutting-edge Farming Machinery to Strengthen their Positions

The prominent players in the market include Oracle Corporation, SAP SE, Thomson Reuters, QAD Inc., MIC, E2open Parent Holdings, Inc., Bamboo Rose LLC, Livingston International, Expeditors International of Washington, Inc., and the Descartes Systems Group Inc., among others, which are focusing on business expansion through collaboration and strategic partnership with other organizations. These players invest in research & development to develop automated trade management systems. For instance,

• July 2021 - Thomson Reuters partnered with Oracle Corporation to adopt Oracle Cloud Infrastructure (OCI) for making its indirect tax software available. Further, the company aims to develop solutions on Oracle Autonomous Database to support and facilitate processes and raise performance with a cloud-based solution.

List of Key Companies in Trade Management Software Market:

• Oracle Corporation (U.S.)


• SAP SE (Germany)


• Thomson Reuters (U.S.)


• QAD Inc. (U.S.)


• MIC (Austria)


• E2open Parent Holdings, Inc. (U.S.)


• Bamboo Rose LLC (U.S.)


• Livingston International (U.S.)


• Expeditors International of Washington, Inc. (U.S.)


• The Descartes Systems Group Inc. (Canada)

KEY INDUSTRY DEVELOPMENTS:

• March 2022 – E2open Parent Holdings, Inc. acquired an e-commerce shipping software company, Logistyx Technologies. With this acquisition, E2open aims to enhance its global footprint for multi-carrier e-commerce shipment management by offering shipping capabilities across its supply chain platform.


• November 2021 - QAD Precision launched a new release of its Global Trade and Transportation Execution (GTTE) solution. The latest release has advanced capabilities to enhance international import and export processes. Further, it will help to improve connectivity and visibility of operations across the supply chain.


• November 2021 – MIC launched new offices in Austria, Vienna, and Hagenberg. The company aims to expand product offerings across the countries.


• July 2020 - QAD Inc. launched the next release, 18.1, of its trade management software, QAD Precision. The next release offers a new import management solution to fulfill critical import regulations and assist enterprises in complying with trade regulations and law changes, which include free trade agreement compliance.


• March 2019 - Thomson Reuters partnered with a data science and analytics solution provider, Alteryx, Inc., to implement analytics technologists to solve tax preparation, reporting, and analysis challenges. Through this partnership, the Alteryx platform will help to streamline the workflow and data automation & analysis for ONESOURCE Tax Automation Suite.

REPORT COVERAGE

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The global trade management software market research report includes prominent areas worldwide to get a better knowledge of the industry. Furthermore, the research provides market trends, insights into the most recent industry, and market 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.

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