The global ERP software market size was valued at USD 55.24 Billion in 2022 and is projected to reach USD 125.02 Billion by 2031 , expanding at a CAGR of around 9.5% during the forecast period, 2023 – 2031. The growth of the market is attributed to rising need for operational efficiency and transparency in company operations, as well as the increasing adoption of mobile and cloud apps.
ERP is a software system that aids in the management of complete organization, including supply chain, manufacturing, human resource, financial, procurement, services, and other activities. Enterprise Resource Planning (ERP) is a corporate management and integration process.
Several ERP software systems are useful for businesses, as they allow execution of resource planning by merging the activities needed to manage their businesses into a single system. ERP systems reduce duplicate data and ensure data integrity through a single source. Inventory expenses can be reduced by 25%–30% and raw material prices by roughly 15% when ERP software is used in an organization.
The emergence of COVID-19 pandemic is expected to provide lucrative prospects for market expansion during the forecast period, owing to growing trend of digital transformation in businesses, as well as increasing need for ERP solutions that are managed or hosted on the cloud.
Furthermore, following the pandemic, businesses focus on technologies that help in advanced preparation and limit the impact of future disasters. The software guarantees that cross-functional information flows smoothly, resulting in increased productivity and improved decision-making.
ERP Software Market Trends, Drivers, Restraints, and Opportunities
- Increasing implementation of IT technology in emerging nations is estimated to drive the market during the forecast period.
- ERP’s ability to integrate with mobile devices is projected to fuel the market during the projected period.
- Low infrastructure cost associated with the system is expected to boost the market in the coming years.
- Lack of skilled labor act as a major factor that hinders the market growth.
- Rising demand for cloud-based ERP software, due to COVID-19, is expected to create immense opportunities for the market players during the forecast period.
Scope of ERP Software Market Report
The report on the global ERP software market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.
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Attributes
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Details
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Report Title
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ERP Software Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast
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Base Year
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2022
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Historic Data
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2016–2021
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Forecast Period
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2023 – 2031
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Segmentation
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Functions (Supply Chain, HR, Finance, and Others), Deployments (Cloud and On-premise), Enterprise Sizes (Small Enterprise, Medium Enterprise, and Large Enterprise), and End-users (Telecom, Aerospace & Defense, Government, Retail, Healthcare, BFSI, and Manufacturing & Services)
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Regional Scope
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Asia Pacific, North America, Latin America, Europe, and Middle East & Africa
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Report Coverage
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Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, and Trends, and Revenue Forecast
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Key Players Covered in the Report
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Sage Group, plc; Unit4; Oracle Corporation; SAP SE; Microsoft Corporation; IBM Corporation; NetSuite Inc.; Infor Inc.; International Business Machines Corporation; Epicor Software Corporation; Infor; and Hewlett-Packard Development Company, L.P.
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ERP Software Market Segment Insights
Functions Segment Analysis
Based on functions, the market is segregated into supply chain, HR, finance, and others. The finance segment held around 28% of the total market share in 2021. ERP software helps manage several financial activities such as cash flow, asset management, investments, and accounting. As a result, increased use of ERP in financial management is projected to fuel the segment during the projected period.
The supply chain segment is anticipated to grow at a rapid pace during the forecast period. The supply chain ERP module increases customer satisfaction, speed, and efficiency by increasing visibility of several supply chain operations. Increasing usage of ERP software in distribution and sales automation is estimated to boost the market.
Moreover, the increasing ecommerce industry is forcing businesses to adopt modern technology for effectively managing supply chain operations, which is expected to propel the market. The HR segment held significant market share in 2021, owing to increasing expansion of companies that made it difficult to manage all operations. Additionally, increasing need for automation in HR process is anticipated to drive the segment during the projected period.
Deployments Segment Analysis
On the basis of deployments, the market is bifurcated into cloud and on-premise. The cloud segment is projected to expand at a rapid pace during the forecast period. ERP software that is deployed in the cloud helps businesses gain accessibility, scalability, efficiency, resource planning, and task optimization. It also has advantages such as rapid implementation and low installment costs.
The on-premise segment held around 70% of the total market share in 2021. A significant advantage of this deployment is that it allows continuous data control and security in any company. The adoption of on-premises solutions in several growing countries is facilitated by lack of awareness about the benefits of cloud-based solutions in business.
Furthermore, growth of the segment is attributed to substantial use of traditional techniques to manage supply chain and other corporate processes with low automation and technological use.
Enterprise Size Segment Analysis
In terms of enterprise size, the market is fragmented into small enterprise, medium enterprise, and large enterprise. The large enterprise segment held around 40% of the total market share in 2021.
One of the major factors driving the segment is increasing need of the large enterprise to maintain and synchronize complex processes including shipping, order fulfilment, procurement, inventory management, and production planning. Furthermore, increasing spending capacity of large-scale organizations on the installation of technology and software solutions accelerates the adoption of cloud-based ERP software.
End-users Segment Analysis
Based on end-users, the market is categorized into telecom, aerospace & defense, government, retail, healthcare, BFSI, and manufacturing & services. The manufacturing & services segment held a key market share in 2021.
ERP software aids in the monitoring & tracking of daily performance and management of customer services. Some features of the software are real-time data tracking, production scheduling, and inventory management. Manufacturers are increasingly turning to ERP technologies to help plan and run operations efficiently.
Regional Analysis
In terms of regions, the market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. North America dominated the market in 2021 and is expected to continue its dominance during the forecast period.
Increasing adoption of ERP software by small and medium-sized businesses, increasing investments by ERP suppliers in the development of software with the latest technology, and existence of several market players this is expected to boost the market in the region. Increased accessibility to ERP services via smartphone applications is expected to fuel the market during the forecast period.
Segments
The global ERP software market has been segmented on the basis of
Functions
- Supply Chain
- HR
- Finance
- Others
Deployments
Enterprise Sizes
- Small Enterprise
- Medium Enterprise
- Large Enterprise
End-users
- Telecom
- Aerospace & Defense
- Government
- Retail
- Healthcare
- BFSI
- Manufacturing & Services
Regions
- Asia Pacific
- North America
- Latin America
- Europe
- Middle East & Africa
Key Players
- Sage Group, plc
- Unit4
- Oracle Corporation
- SAP SE
- Microsoft Corporation
- IBM Corporation
- NetSuite Inc.
- Infor Inc.
- International Business Machines Corporation
- Epicor Software Corporation
- Infor
- Hewlett-Packard Development Company, L.P.
Competitive Landscape
Key players competing in the ERP software market include Sage Group, plc; Unit4; Oracle Corporation; SAP SE; Microsoft Corporation; IBM Corporation; NetSuite Inc.; Infor Inc.; International Business Machines Corporation; Epicor Software Corporation; Infor; and Hewlett-Packard Development Company, L.P.
Some of these players are using several market strategies such as acquisitions, mergers, collaborations, partnerships, capacity expansion, and product launches to enhance their market shares, generate revenue, and raise their production line of the business in the coming years. For instance,
- In September 2020, Embridge Consulting collaborated with Unit4. With this agreement, the companies hope to provide small and medium-sized businesses with SaaS-based ERP systems while benefiting from the services and technical business experience.
- In October 2018, Sage Software expanded its Sage Intacct range with new features, aiming towards increasing its geographical presence.
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