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If you’re of a certain age, you may remember those crazy bounces you could get from a Super Ball. The image is an apt way of describing the bounce in the market for supply chain management software in 2010.
The worldwide market for supply chain management software applications, maintenance and services, or SCM, came in at $6.755 billion in 2010, including applications for procurement software, and nearly $4.6 billion without procurement, according to Chad Eschinger, a research director with Gartner. That’s an impressive 10% bounce over 2009. “It was a good, up year,” Eschinger says. That’s a bit of an understatement given that 2009 had posted a 1.9% decline over prior year revenues, the first year-over-year drop in revenues for SCM software since Modern began publishing an annual Top 20 list in 2001.
When it comes to market leadership, 2010 reminds us of the lyrics from that old Billie Holliday song, “God Bless The Child:” “Yes, the strong gets more, while the weak ones fade.” The market leaders look much the same as they did in 2009, with SAP ($1.317 billion) and Oracle ($1.21 billion) still at the top of the list and posting impressive gains over 2009.
They were followed by JDA Software ($362 million), Manhattan Associates ($136 million) and RedPrairie ($94 million), according to Gartner’s analysis. If there was a surprise, it was that Manhattan was once again atop RedPrairie; the companies had switched places in 2009 following Manhattan’s decline in revenues. Back then, Eschinger noted that despite the decline, he believed Manhattan was on the right path with its platform approach to the supply chain space—an observation that proved prescient as the company rebounded in 2010.
One other important note: As Eschinger points out, SAP, Oracle and JDA account for 43% of the total software market while the remaining players—several hundred of them—comprise the remaining 57%. The strong gets more indeed.
From a business standpoint, it was another year of status quo, with few mergers and acquisitions and few technological breakthroughs. The most noteworthy event was JDA’s purchase of i2 Technologies that closed in early 2010. If that sounds like what we published last year (or the year before), well, it’s a reflection of the times.
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