The warehouse software market is facing a rapid growth trajectory, according to the latest research from Interact Analysis. As robots become more commonplace in warehouses, more operators will be turning to advanced software to help orchestrate all of the moving pieces.
In 2023, the market was valued at $7.2 billion. The research firm said it expects this to grow to $16.6 billion by 2030.
“The exponential growth of the warehouse automation-related software segment we have observed is the result of a few key drivers,” stated Irene Zhang, a senior analyst at Interact Analysis. “First of all, the growth of warehouse automation has created the need for software that can be used to control and execute solutions.”
“There is also a need to optimize the overall throughput due to the growth of modular and standardized automation subsystems, which require orchestration and execution of various modules,” she added.
“Finally, the growth of the mobile robot market has driven demand for fleet management systems,” Zhang said. “As well as this, the availability of the robotics-as-a-service (RaaS) model has also contributed to the widespread adoption of mobile robots.”
WMS remains on top; other warehouse software to grow
Standalone warehouse management systems (WMS) remain the largest software category, according to Interact Analysis. In addition, the markets for other automation-related software, like robotic picking software, multi-fleet orchestration platforms, and warehouse control systems (WCS), are expected to grow rapidly and at a higher rate than the total warehouse software market.
The automation-related software segment will expand at a compound annual growth rate (CAGR) or approximately 19.5% between 2023 and 2030, said the company. This is compared with a 12.7% growth expected for the warehouse software market as a whole.
Interact Analysis said that the boundaries between different types of warehouse software vendors have become blurred as vendors expand their software product offerings. Many traditional WMS vendors have started offering warehouse execution systems (WES) and WCS, for example.
The WES market is changing
According to Interact Analysis’ latest study, the deployment of a WES is a strategic choice that can lead to increased operational efficiency. These systems provide visibility into warehouse assets and the capability to dynamically release orders and assign tasks based on the real-time status of those assets. This can help warehouses avoid bottlenecks and increase efficiency, it said.
Warehouse managers can also use WES data to provide feedback and predict how future automation could affect capacity and efficiency, the company added.
The biggest question moving forward, according to Interact Analysis, will be about who is providing the WES. Historically, automation vendors have been the main suppliers of WES solutions, given the amount of data they have on throughput rates and system constraints.
However, Interact Analysis reported strong growth in stand-alone warehouse execution systems, independent of WCS and WMS. It has also seen growth in embedded WES, where such systems are embedded into the warehouse management systems.
The next few years will be highly dynamic, as different groups of companies will compete to provide orchestration and execution capabilities, said Interact Analysis.