Dip in supply chain software sales

30 June 2010

30 June 2010 | Nick Martindale


The global market for supply chain management (SCM) software declined by 0.7 per cent in 2009 as customers cut back on IT investments.

Figures released by Gartner found revenue from new licences fell by 7.4 per cent while the market was propped up by a 10.2 per cent growth in subscriptions and a 0.2 per cent rise in maintenance, as organisations stuck with existing packages.

Chad Eschinger, research director at Gartner, said: “The economic climate of the past few years and the maturity and saturation of implemented business applications has proven difficult.

“This stressed environment has forced many vendors to increase maintenance rates and explore various channel, delivery and pricing options.”

Vendors that offered a subscription-based approach to their software packages tended to fare best. Ariba reported a rise of 8.8 per cent in revenue while Oracle increased sales by 0.2 per cent on the back of its best-of-breed approach.

Other major vendors in the market reported falling revenues, including SAP (down 8.8 per cent), JDA Software (2.5 per cent), i2 Technologies (2 per cent) and Manhattan Associates (21.4 per cent).

Gartner also reported that competition between enterprise suite and specialist vendors had heightened.

Sales of specialised packages reached $3.5 billion (£2.3 billion) in 2009 – a 1.6 per cent increase from 2008 – while the suites segment totalled $2.7 billion (£1.8 billion), a fall of 3.7 per cent.

Eschinger said: “Although suite vendors are typically well positioned within organisations to stall emerging-application purchases, there are significant opportunities for specialised vendors that offer differentiating domain and vertical solutions that are blind spots in a suite provider’s offering.”

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