Latin America ERP Software Market Size, Share & Trends Analysis Report By Deployment, By Functions (Finance, HR, Supply Chain, Others), By Vertical, By End-user (Large Enterprises, Medium Enterprises, Small Enterprises) And Segment Forecasts, 2018 - 2025

Industry Insights

The Latin America ERP software market size was USD 1.14 billion in 2016 and is expected to gain traction over the forecast period. The market is majorly driven by the emergence of a vast number of small and medium-sized enterprises (SMEs) in numerous sectors including manufacturing, retail, telecom, and IT services.

Some of the major factors driving the growth of this market are the growth of enterprise software and the workplace automation industry in the Latin America marketplace. High penetration of manufacturing companies in Chile, Peru, and Mexico. Specifically, the mining industry in Chile & Peru is anticipated to yield high revenues in the ERP software segment in comparison to other verticals.

Mexico ERP software market by functions, 2014 - 2025 (USD Million)

Government organizations were one of the largest employers in the region, are expected to boost ERP software economies further to optimize workflow and aligned revenue. Increasing demand for software which can enhance transparency and operational efficiency by streamlining various processes it is expected to augment demand over the forecast period

To remain competitive in the market, the ERP software vendors are updating the pricing models to protect their core offering. The vendors are focusing on better integration architecture owing to the increasing adoption of specialized ERP software.

Deployment Insight

Based on deployment, the market has been segmented into on-premise and cloud deployment. The on-premise deployment segment is anticipated to dominate the market (in terms of size) by 2025. The cloud deployment segment is expected to witness a significant growth rate, due to its growing adoption.

On-premise deployment of services gives control over systems or infrastructure and sensitive business data. The on-premise deployment model comes with pre-build extract, transform, load (ETL) framework that reduces implementation time.

Cloud Lower upfront investments, faster implementation times, and less intensive ways of running businesses have made cloud-based deployment models highly popular. Cloud-based deployment of ERP software enables scalability, immediacy, efficiency, accessibility, and optimization of resource planning activities.

ERP hybrid technology includes features of both on-premise and cloud technology, thus providing cost-effectiveness, data security, and agility in business processes. It overcomes issues such as high cost and security which are being faced in on-premise and cloud deployment respectively.

Functions Insight

ERP finance modules help to automate payments, manage assets, and create financial reports. Furthermore, it facilitates in gathering financial data and generating reports such as ledgers, trail balance data, overall balance sheets, and quarterly financial statements.

HR ERP function helps to automate, streamline, and extend the core human resource processes and activities such as workforce management, time and attendance, recruiting, payroll maintenance among others.

ERP module in supply chain management allows manufacturing and distribution businesses provides greater visibility into various supply chain operations while increasing speed, efficiency, and overall customer satisfaction. Others ERP helps in effective management and automation of sales and distribution, and numerous other such associated tasks

Vertical Insight

Manufacturing companies and service providers adopt ERP systems to streamline operations, address customization requirements, and manage complicated supply chains to build profitable sustainable businesses. Similarly, adoption of ERP software in BFSI assists in streamlining complex financial processes such as cash accounting, payment processing, the security of cash and cash management along with analyzing the financial condition of an enterprise, account management and preparation of financial reports and statements

ERP system can provide real-time data to a healthcare organization or a hospital and help departments make critical decisions related to patient care or materials management. ERP in retail carries out effective decision-making policies concerning sales planning, supply, and merchandising activity, customer service along with reducing operational and marketing costs, and optimizing business profitability and working flow.

Government ERP or GRP aids in operating with fiscal accountability, delivering service reliability, maintaining assets and infrastructure and optimizing the public-sector workforce

Aerospace and defense: ERP software help in component maintenance, repair and overhaul (MRO) for civil aviation, military and service providers, as well as line maintenance or at-platform/asset support

Telecom: ERP in telecom offers advantages such as real-time integration across the company, deep performance, and financial visibility, careful management of regulatory compliance risk, and deployment of new operational and technological models. The others segment includes the use of ERP in verticals such as education, and entertainment and media.

End-use Insight

Based on the end use, the Latin America ERP software market has been split by deployment into small, medium and large enterprises. The large enterprise segment dominates the market (in terms of size) in 2016. The medium enterprise segment is anticipated to witness a significant growth rate and dominate the market (in terms of revenue) by 2025.

Latin America ERP software market by End-user, 2016 (%)

The market sizing (revenue) estimates and forecasts for end-use segment broadly comprise of revenue contribution by host/parent organization towards a particular division along with the input by other subsidiary organizations (in the case of outsourcing) towards the revenue generation for that specific segment for the parent company as a whole.

Compliance of stringent government regulations requires replacement of manual or paper-based system to ERP application which not only helps to avoid errors and save time but also lead to proper compliance with these regulations. For instance, Caja de Compensacion La Araucana a Chilean based insurance company adopted SAP ERP software to improve the business processes and is aimed at modernizing the financial, sales, accounting, and credit departments.

Regional Insight

The Latin American regional ERP software market includes Brazil, Chile, Peru, and Mexico.

Enterprise software and workplace automation industry is gaining momentum in the Latin. Manufacturing, finance, and tourism segments are expected to lead the ERP software market in terms of adoption in Chile

Recent administrative endeavors of revenue sources diversification have boosted the financial sector of the Chile region. The advent of cloud ERP technology coupled with flexible pricing of the connected devices may result in a bigger turnaround of the market

The manufacturing sector dominated the Mexican enterprise resource planning software market in terms of revenue generation in 2016. This growth is driven by increasing vehicle and parts production particularly in the states of Aguascalientes, Guanajuato, and San Luis Potosi. Since 2011, the government has mandated ‘Comprobantes Fiscal Digital Internet (CFDI)’ an electronic billing scheme for companies operating in Mexico.

The development of the manufacturing sector across Peru and increasing investment in the corporate management solutions are paving the way for adopting more and more sophisticated IT services such as enterprise resource planning software and customer relationship management (CRM) services.

Latin America ERP Software Market Share Insight

The key industry participants of the market are IBM (U.S.A.), Oracle (U.S.A.), Microsoft (U.S.A.), SAP SE (Germany), Infor (U.S.A.), Sage Group Plc (U.K.), Totvs S.A. (Brazil) and Unit4 (the Netherlands. The key players in the market have adopted the strategy of mergers and acquisitions to expand their product portfolio. For instance, In 2016, Oracle Corporation had a partnership with Mellanox an Israel-based supplier of ethernet interconnect solutions and InfiniBand. This acquisition enabled the Oracle Corporation to jointly develop the industry-standard high-speed cloud networking technology.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest trends and opportunities in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the Latin America ERP Software market based on deployment, function, verticals, end-user, and regions.

• Deployment Outlook (Revenue, USD Million; 2014 - 2025)

  • On-premise

  • Cloud

• Function Outlook (Revenue, USD Million; 2014 - 2025)

  • Finance

  • Human Resource (HR)

  • Supply Chain

  • Other

• Vertical Outlook (Revenue, USD Million; 2014 - 2025)

  • Manufacturing & Services

  • BFSI

  • Health Care

  • Retail

  • Government Utilities

  • Aerospace & Defense

  • Telecom

  • Others

• End-User Outlook (Revenue, USD Million; 2014 - 2025)

  • Large Enterprises

  • Medium Enterprises

  • Small Enterprises

• Regional Outlook (Revenue, USD Million; 2014 - 2025)

  • Latin America

    • Brazil

    • Mexico

    • Chile

    • Peru