Warehouse Management Systems Market Size, Share & Trends Report

Warehouse Management Systems Market Size, Share & Trends Analysis Report By Component (Services, Software), By Deployment (Cloud, On-premise), By Function, By Application, And Segment Forecasts, 2021 - 2028

  • Published Date: Feb, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-2-68038-151-1
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 90

Report Overview

The global warehouse management systems market size was valued at USD 2.64 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 15.3% from 2021 to 2028. Growing application sectors, such as healthcare, manufacturing, and retail, across the globe are projected to drive the demand for warehouse management systems (WMS) for efficient operations to increase their output and meet rising consumer demand. In an attempt to address growing demands, logistics companies are continuously progressing to overcome challenges created by fluctuating product markets and shipping schedules. A WMS helps reduce lead time, increase product delivery speed, and minimize distribution costs. The software is designed to cater to complex, sophisticated warehouse operations as well as to tackle less complex resource-constrained operations.

North America warehouse management systems market size, by deployment, 2016 - 2028 (USD Million)

Moreover, it is also used by various end-users, such as third-party logistics, B2B distribution companies, and other manufacturing companies. Demand for WMS is anticipated to witness a sharp rise due to changing supply chain models of product manufacturers and rapidly growing consumer demand, especially in the transport & logistics and retail sectors. The need for manufacturers to automate warehouse management processes and curtail costs globally is one of the key trends triggering the market growth. High demand for the system can also be attributed to its ability to ship products faster through the shortest shipping routes.

Customers prefer cloud-based WMS services to on-premise solutions as the former ensures cost reduction on the service. Software-as-a-Service (SaaS) was introduced to meet the burgeoning demand for cloud-based services as it offers a low upfront cost and enables faster implementation in warehouses. These systems can manage both inbound and outbound freight and cross-docking. These systems are also compatible with other supply chain systems, such as business analytics, transportation management systems, slotting management, and yard management. Furthermore, cloud-based WMS can be accessed from any location through web-based portals. These systems extend supply chains to align fulfillment services and inventory management with advanced purchasing methods and provide real-time visibility into an entire inventory available via browsers and smartphones.

In the wake of the recent Covid-19 outbreak, there has been a significant disturbance in most industries across the globe. While few industries experienced a contraction in their productions and businesses, others faced severe outcomes, such as the shutdown of businesses and movement restrictions. For instance, the travel, entertainment, food & beverage, and hospitality industries had the most retrenchments, and on the other hand, healthcare and e-commerce businesses had an upsurge in demand.

The demand for warehousing has increased due to the rising trend of online purchasing. The implementation of lockdowns, social distancing, and various other safety measures due to the pandemic has led consumers to pursue online purchasing. Therefore, several multinational companies are setting up new warehouses across numerous countries to accommodate the rising demand. This has resulted in the growing use of WMS in e-commerce and third-party logistics industries. E-commerce companies, such as Amazon.com, Inc., Alibaba.com., and eBay Inc., are ramping up the demand for WMS as they continue to set up new warehouses across the globe.

Component Insights

The services segment held the highest revenue share of more than 82% in 2020 in the global WMS market. The services segment includes consulting, system integration, operation, and maintenance services. Warehouse management can be provided as a service by third-party vendors, which is outsourced by WMS providers. Vendors sell their products by either offering them as a service, which helps the clients to focus on their core business operations or selling the software to the client without the service.

The software segment is expected to register the fastest CAGR of over 17% from 2021 to 2028. The growth can be attributed majorly to the increasing adoption of WMS software by Small- and Mid-sized Enterprises (SMEs) worldwide. The software is hosted via a cloud-based computing system. Furthermore, factors, such as rising demand in the retail & manufacturing sectors and high consumer disposable incomes, are expected to support the segment growth. In addition, WMS software can be a standalone system or part of a supply chain execution suite and is widely used as a tactical tool by businesses to meet the unique customer requirements of their supply chain and distribution channel.

Deployment Insights

The cloud segment held the highest revenue share of more than 55% in 2020 and is expected to emerge as the fastest-growing segment from 2021 to 2028. Cloud-based technology has revolutionized the way businesses function. When deployed on the cloud, WMS offers a reduction in the upfront costs of companies and drastically increases warehouse efficiency. Over the years, cloud deployment has become as secure as the on-premise system on account of data sovereignty and successful curbing of data thefts. Companies are now able to customize and provide a WMS service based on the client’s requirements.

For instance, the cloud-based WMS enables clients to scale or downsize the level of operations based on their seasonal demand. The on-premise deployment has been prominent since the advent of WMS. However, it is estimated to register sluggish growth as it is characterized by huge servers and high maintenance costs, ultimately increasing the company’s expenditures. These upfront costs and ownership of maintaining the on-premise server are incredibly high compared to the cloud-based technology. Moreover, the on-premise solutions have a lengthy and time-consuming implementation process as compared to the cloud-based solutions.

Function Insights

Systems integration & maintenance was the largest segment and accounted for a revenue share of over 32% in 2020. Functions, such as inventory receiving and put away, optimization of picking and shipping of orders, guidance in inventory replenishment, are carried out by WMS.

Order picking functionality is one of the most crucial features in a warehouse management optimization suite that is designed to automate the paper-based picking process. The material handling process and picking are affected by many factors, including warehouse layout, customer requirements, order type, and product velocity. A WMS capable of accommodating fulfillment requirements irrespective of individual warehouse characteristics is more beneficial than a WMS with a limited scope of application.

Furthermore, order allocation is another essential feature of any robust WMS. As soon as a sales order is received, it is entered into the Enterprise Resource Planning (ERP) system and gets immediately updated in the WMS software. Order management is expedited as there is no time lapse between the product being received in the warehouse and being available for order allocation. The analytics & optimization segment is expected to register the fastest CAGR from 2021 to 2028.

Application Insights

The manufacturing segment held the highest revenue share of over 24% in 2020. The manufacturing companies initially integrated their ERP and WMS solutions. They are integrating their logistics & transport management systems too to gain full control of the supply chain. In addition, the use of cloud-based technology is enhancing the efficiency and performance of supply chain management in the manufacturing sector.

Global warehouse management systems market share, by application, 2020 (%)

Transportation & logistics is expected to emerge as the fastest-growing application segment from 2021 to 2028. The growth can be attributed to the increased popularity of e-commerce portals coupled with growing disposable income levels of consumers, especially in emerging nations, such as India and China. Logistics and supply chain companies are rapidly adopting WMS to improve their operations and increase warehouse efficiency and productivity. Also, rising awareness about the benefits of having a well-integrated WMS, such as efficient warehouse operations to meet the rising demand will support segment growth.

The healthcare segment is anticipated to emerge as a prominent adopter of WMS as providers are building facilities taking into consideration the pre-requisites of the healthcare sector. For instance, DHL’s Cherwell European healthcare center is the largest user-shared logistics center in the U.K. that offers a healthcare WMS. The facility uses the OBS Logistics system, and its services include inventory management for a wide range of temperature-controlled pharmaceutical products, diagnostic reagents, and medical devices.

Regional Insights

Europe led the global market and accounted for over 33% of the overall revenue share in 2020. The advancement in the WMS and increasing awareness about cloud-based WMS are primary factors driving the regional market. Led by the U.S., North America accounted for the second-highest revenue share in the same year. The presence of wide networks of third-party logistics (3PL) companies & large-scale companies with global distribution operations and warehousing and sustained growth in the e-commerce industry are propelling the market growth in North America. Moreover, the strong presence of ERP vendors in the U.S. supports the overall growth of the regional market. In addition, the country has a high demand for food and beverages, which requires continuous supply from warehouses as it adds quality control, efficiency, and consistency to the process.

Asia Pacific is projected to be the fastest-growing regional market during the forecast period owing to its high-growth economies, such as China, India, and the Philippines. With the increasing purchasing power of consumers, developing countries are witnessing a growth in the demand for end-use products. This is positively influencing the demand for WMS for an uninterrupted supply of products. Moreover, since Asia Pacific is a price-sensitive region, SaaS is highly preferred by companies using the WMS technology. Advantages, such as lower entry cost and risk, cost-effective growth, access to the best technology, and dynamic & advanced software features, offered by the model are seizing manufacturers’ attention.

Key Companies & Market Share Insights

Major market participants are focusing on several strategies to gain a higher market share. Mergers, acquisitions, partnerships, and other contractual agreements are being announced by these market players to emerge as the top WMS companies. Moreover, these players are investing in research and development activities to bring new services to the market. For instance, in May 2020, Manhattan Associates launched a new Manhattan Active Warehouse Management Solution, a cloud-native enterprise-class WMS to unify all aspects of distribution without any upgradation. Some prominent players in the global warehouse management systems market include:

  • Epicor

  • Körber AG (HighJump)

  • Infor

  • Made4net

  • Manhattan Associates

  • Oracle

  • PSI Logistics

  • Reply

  • SAP

  • Softeon

  • Synergy Ltd.

  • Tecsys

Warehouse Management Systems Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 3.0 billion

Revenue forecast in 2028

USD 8.1 billion

Growth Rate

CAGR of 15.3% from 2021 to 2028

Base year for estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million/billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments Covered

Component, deployment, function, application, region

Regional scope

North America; Europe; Asia Pacific; South America; Middle East & Africa

Country scope

U.S.; Canada; Mexico; U.K.; Germany; China; India; Japan; Brazil

Key companies profiled

Epicor; Körber AG (HighJump); Infor; Made4net; Manhattan Associates; Oracle; PSI Logistics; Reply; SAP; Softeon; Synergy Ltd.; Tecsys

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global warehouse management systems market report on the basis of component, deployment, function, application, and region:

  • Component Outlook (Revenue, USD Million, 2016 - 2028)

    • Software

    • Services

  • Deployment Outlook (Revenue, USD Million, 2016 - 2028)

    • On-Premise

    • Cloud

  • Function Outlook (Revenue, USD Million, 2016 - 2028)

    • Labor Management System

    • Analytics & Optimization

    • Billing & Yard Management

    • Systems Integration & Maintenance

    • Consulting Services

  • Application Outlook (Revenue, USD Million, 2016 - 2028)

    • Transportation & Logistics

    • Retail

    • Healthcare

    • Manufacturing

    • Food & Beverage

    • Others

  • Regional Outlook (Revenue, USD Million, 2016 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • U.K.

      • Germany

    • Asia Pacific

      • China

      • India

      • Japan

    • South America

      • Brazil

    • Middle East & Africa

Frequently Asked Questions About This Report

Pricing & Purchase Options

Service Guarantee

  • Insured Buying

    This report has a service guarantee. We stand by our report quality.

  • Confidentiality

    We are in compliance with GDPR & CCPA norms. All interactions are confidential.

  • GDPR.EU
  • Custom research service

    Design an exclusive study to serve your research needs.

  • 24/5 Research support

    Get your queries resolved from an industry expert.

Buy Chapters or Sections

Avail customized purchase options to meet your exact research needs:

  • Buy sections of this report
  • Buy country level reports
  • Request for historical data
  • Request discounts available for Start-Ups & Universities