SaaS Offers New Revenue Opportunities for Supply Chain Software

Software engineering working on his laptopSoftware as a service (SaaS) will allow the global supply chain software market (SCM) to record more than $19 billion of total revenue by 2021, according to a Gartner report.

The report estimated that revenue generation for 2017 from SaaS license management software to the use of cloud applications would exceed $13 billion, up 11% year over year.

Revenue Growth

Between this year and 2021, the research firm’s forecast meant that it would add almost $6 billion to the market, as digital tools boost demand for flexible solutions that lead to the creation of new business models, according to Chad Eschinger, Gartner’s managing vice president.

The company’s researchers noted that SCM companies have responded to increasing demand, by implementing different strategies to establish their areas of expertise.

These niches include mobile services and Big Data analytics, although experts expect the market’s structure to remain unchanged in the future. This composition consists of main categories such as supply chain planning, procurement and supply chain execution.

Growing Popularity

More companies particularly small- and mid-sized businesses have shifted to the use of Saas, since it saves on costs compared to using a traditional CAPEX or OPEX model. SCM companies have also recognized that the development caused a greater level of competition.

Hence, service providers have sought to offer new solutions. In-memory technologies, IoT, machine learning and mobility solutions comprise just some of the new products.

The development of new offerings would also lead to SaaS accounting for 35% of capital spending in the SCM market, while on-premises license sales would capture a smaller share of total expenditures at less than 20%, according to the report.

Conclusion

SaaS provides the global supply chain software market with new ways to sustain and expand business. For your business, do you think using SaaS will help in boosting revenue in the near future?