The ERP software market was valued at US$36.152 billion in 2019. Enterprise resource planning (ERP) is a method in with computer technology is used throughout the organizations and this technology is linked with some of the most important functions of an organization that includes accounting, HR, and customer relationship among others. These tools are intended to facilitate decision making, information sharing, and business planning for the overall departments of the organization. Also, this software enhances the operational efficiency of an organization as numerous system integrated applications are used to manage the business and also to automate a number of back-office functions. ERP software is integrated with numerous facets of an operation including product planning, manufacturing, development, and sales & marketing in a single database, UI, and application. Additionally, these tools have the ability to offer automated reporting and synchronizations which further helps the organizations to save time and resources as no separate databases or spreadsheets are required to be worked on and merged manually for reporting, thus emanating its demand across various industry verticals.
Furthermore, the growing need for boosting operational efficiency coupled with transparency of the organizations along with the continuous evolution of regular business operations to data-driven operations is also a key factor bolstering the demand for ERP software and adding up to the market growth significantly. Similarly, a rapidly growing trend for cloud-based and mobile applications also provides an impetus for the market to grow in the near future.
However, the market may be restrained by the fact that the availability of open source applications is expected to hamper the adoption of paid tools and platforms which may inhibit the market growth to some extent during the coming years. Furthermore, high initial costs coupled with high maintenance costs is also considered to be one of the key factors due to which many companies are reluctant towards the adoption of these solutions to moderately and thus slow down the market growth during the coming years. Moreover, the growing adoption of these tools across the small and medium enterprises due to growing data-driven operations and increasing budgets for the adoption of automated business processes is also anticipated to propel the opportunities for the market to grow during the next five years. Also, the economic benefits achieved on the application of these tools throughout the departments of the organization is also a major factor that is projected to drive the market growth over the course of five years.
The ERP software market has been segmented on the basis of function, enterprise size, deployment, industry vertical, and geography. On the basis of function, the ERP software market has been segmented into customer relationship management, human resource, finance, and others. On the basis of enterprise size, the classification of the market has been done into small and medium, and large enterprises. On the basis of deployment, the market has been segmented on the basis of on-premise and cloud. Geographically, the ERP software market has been segmented into North America, South America, Europe, Middle East and Africa, and Asia Pacific.
Finance to hold a decent market share
On the basis of functionality, the finance segment is projected to hold a considerable share in the ERP market owing to the adoption of the finance modules across the organizations to maintain the complexities of the financial operations of the businesses with an aim to achieve the overall operational efficiency. Also, these tools offer various benefits to manage the accounting activities, cash flows, and inventory among others, thus positively driving the growth of this segment over the coming years.
The human resource segment is projected to show a noteworthy growth during the forecast period due to the growing expansions of the organizations at the personnel level thereby propelling the complexities for the management of HR activities thus positively impacting the growth of this segment in the coming years.
The manufacturing industry is also projected to hold a significant market share owing to the growth of various industries under this segment such as automotive, consumer electronics, and pharma among others. However, the recent advent of COVID-19 has led to a halt in the manufacturing activities across various industries which is considered to retrain the growth of this segment over a period of six to eight months.
Cloud deployment to show a robust growth
On the basis of deployment, cloud deployment segment is anticipated to show a significant growth throughout the forecast period. The major factors that supplement the growth of this segment include the low infrastructural investments along with the ability of these tools to integrate with mobile devices.
The on-premise segment is anticipated to hold a notable share throughout the forecast period owing to numerous benefits of these solutions regarding 100% control along with the security of the company’s crucial data.
North America to hold a significant share
North American region is anticipated to hold a significant market share due to the presence of the state-of-art infrastructure and rapid adoption of technology across all the industry verticals. Furthermore, the presence of key market players in the region also bolsters the growth of the ERP software market in North America during the next five years.
Prominent key market players in the ERP software market include Microsoft Corporation, SAP, Oracle, IBM, and Adobe among others. These companies hold a noteworthy share in the market on account of their good brand image and product functions. Major players in the ERP softwaremarket have been covered along with their relative competitive position and strategies. The report also mentions recent deals and investments of different market players over the last two years.