Better Days Ahead for the Worldwide Supply Chain Management Services Market, IDC Says

FRAMINGHAM, MA – JUNE 11, 2002 – The worldwide supply chain management services market (SCMS) will grow at a compound annual growth rate of 15.1% to reach $55.3 billion in 2006, a new study from IDC forecasts. In 2001, this market felt the impact of the global economic slowdown, with growth rates decreasing to the 3-4% range and a total market size of about $27.4 billion. In comparison with previous years in which growth rates were in the high 20s, this dramatic shift left many market players scrambling to refocus their service offerings and to reevaluate the staffing levels within their practices.

“Better days are on the horizon for the SCMS market,” said Romala Ravi, program manager with IDC’s Supply Chain and Logistics Management Services research. “We expect to see stronger growth in this market during the 2003 time frame because of an anticipated economic upturn in the United States by the end of 2002, and greater market penetration by supply chain software application vendors throughout global markets.”

The product life-cycle management segment and the procurement segment will be key growth areas within the SCMS market. IDC also believes that there will be increasing demands for vendors in the SCMS space to provide business process outsourcing services around supply chain functions such as logistics and procurement.

The road ahead for supply chain services firms will continue to be challenging. Companies will be increasingly looking to their SCMS vendors to help them articulate a clear relationship between the supply chain investments and their overall strategic goals. Clients will demand smaller projects that are set within the framework of a long-term strategic vision. IDC believes achieving a fine balance between short-term projects and a more strategic, long-term vision, with “show me” milestones along the way, will be an important success factor for SCMS vendors.

IDC’s study, Worldwide Supply Chain Management Services Market Forecast, 2001-2006 (IDC #26852) discusses developments on a worldwide basis in the supply chain management (SCM) services market over the last 12 months and provides a 5-year worldwide market forecast for 2001-2006. Key components of the study include a worldwide market forecast segmented by regions, a U.S. market forecast segmented by service categories and vertical industries, overall market trend analysis, and IDC's recommendations for SCM service providers. IDC also provides its predictions on how the supply chain services (SCS) market will evolve over the next 12 months. This report will assist market players in evaluating their own corporate strategy for competing in the SCS market while outlining the future direction of this market segment and identifying potential revenue growth opportunities.

To purchase this document, call IDC's volume sales hotline at 508-988-7988 or email jnagle@idc.com.

For more information about IDC’s Supply Chain and Logistics Management Services research program, please contact Jill Toole at 508-988-6915 or at jtoole@idc.com.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

 

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