About a month or so ago, Software Advice released it’s Manufacturing Software State of the Industry Roundtable (Part I and Part II) where they reported buying activity, spending patterns by business size and industry, and the primary motivations behind current buying activity as well as well as activity in the software as a service (SaaS) market, how vendors are adjusting prices to compensate for the economy, how offshoring influences spending and whether manufacturers are implementing integrated enterprise resource planning (ERP) systems or best-of-breed applications.
The main results are summarized below. Everything is pretty much as you’d expect if you’ve been keeping up with the supply chain space and the economy:
- Market Activity Up
It’s a recession, and most M&A happens during a recession when there are good deals to be had.
- Small and Medium Enterprise Spending Up
Most innovation comes from small and medium size enterprises, who have probably figured out it’s a do-or-die, and do it cost-effectively, economy. Hence, a slight rise in SME spending.
- Large Enterprise Spending Flat
No surprise that the slow behemoths are trying to keep the status quo and wait it out.
- Food, chemical and consumer packaged goods manufacturers Up
People have to eat and meet their basic needs, but they don’t have to buy overpriced products to do so. Hence, the F&B and CPG companies will be investing to cut costs and retain market share.
- Aerospace, semiconductor and automotive manufacturers Flat
Business people still have to travel, old cars still break down, and sales make flights and cars very attractive to vacationers and buyers who have disposable income. Plus, all the bailouts allow the dinosaurs to keep bumbling along at their slow and steady paces. As for semiconductors, we live in the information age where we can’t do without the chips they produce.
- Software as a Service Up
Companies are getting comfortable with the concept, which is becoming very attractive with limited budgets and high-speed internet everywhere.
- Manufacturing ERP Software Pricing Down
The lumbering giants are realizing that people won’t pay seven figures for a solution when they can get an 80% or 90% solution for five figures.
- Integration Across Plants and Supply Chain Up
It’s still slow, but the onslaught of vendors that have hit the space in the last decade are continuing to make progress.
- Best-of-Breed Applications Flat
Nothing has happened to make them more or less attractive as a whole.
- Integrated ERP Suites Up
If you have to buy ERP, you’re at least going to buy one that enables organizational efficiency.
To dig into the details, check out the two part series over on Software Advice which just released it’s Manufacturing Software State of the Industry Roundtable (Part I and Part II).