Global Transportation Management System Market By Deployment mode (On-Premise and Cloud Based), By Mode of Transportation (Roadways, Railways, and Others), By End-Use Vertical, By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends, and Forecast 2023-2032

Report Overview

The Global Transportation Management System Market size is expected to be worth around USD 46.2 Billion by 2032, From USD 12.4 Billion by 2023, growing at a CAGR of 14.50% during the forecast period from 2023 to 2032.

Global industry growth is due to the expansion of the retail and online industries, constant technological advancements that lead to innovative solutions, and the strengthening of bilateral trade relations between different countries. The industry was hit hard by the COVID-19 pandemic, which caused unusual sales and installation declines. Transportation Management System Market growth may be limited by disruptions in the retail sector, such as forced lockdowns and a shift in consumer spending habits.

Due to shortages of parts, several major system manufacturers temporarily suspended operations. This resulted in the slow adoption of transportation management systems (TMS). However, existing transportation management systems are being utilized aggressively around the world.

The inevitable use of technology to prevent disasters and the increasing importance of data-driven solutions within the transportation & logistic industry to reduce the unimaginable effects of the pandemic increase the potential for future adoption of TMS solutions. TMS allows incumbents in different industry verticals to reduce costs, increase efficiency, and provide real-time supply chain visibility while improving customer service.

Driving Factors

The High Return on Investment

Many transportation management systems can speed up the time between placing an order and receiving it. They can also reduce inventory management costs, assure compliance, lower freight prices, and shorten the time required to track customs paperwork. The transportation management system market could grow because of the higher return on investment (ROI).

When a transportation management system is used, the return on investment (ROI) often comes down to how well the load management is done. TMS solutions change constantly, and there are many ways to increase ROI. TMS solutions can directly impact freight savings, including better procurement negotiations, efficient routing, and the selection of low-cost modes.

Restraining Factors

High Implementation Costs

Transportation management systems can be categorized as modular, scalable, and simple to use. They are compatible with all types of transportation. TMS providers have begun to choose the cloud as their new solutions will be more complex as supply chains expand around the globe.

Because of concerns about data privacy, security breaches, and cyberattacks, companies prefer to have their solutions on-premise. For organizations without the resources or technical expertise to build their infrastructure, cloud-based solutions can be cheaper and more lucrative than traditional on-premise solutions.

On-premise solutions are more costly because customers have to purchase the infrastructure and hardware and then hire the staff to maintain it. High costs of implementation and licensing can also be a problem with on-premise solutions. These fees can amount to as high as 25% of the total solution cost. On-premise solutions will likely slow down the transportation management system market growth in the TMS industry over the next few decades due to their high cost of implementation and licensing.

Growth Opportunities

The Growth Of E-Commerce In Transportation

E-commerce growth and the high return on investment associated with transportation management systems will likely drive the market’s growth. This segment is in demand because of the improvement in trade between emerging and developed economies.

There has been an increase in imports and exports. The demand for raw materials has increased due to the increasing number of Indian and Mexican factories. These raw materials must come from different locations, which means that transportation management systems need to be both creative and efficient.

The growing demand for luxury cars in emerging countries is also helping to increase the transportation management system market for the logistics sector. This is because many luxury cars are manufactured in Europe and shipped from there to other countries.

The automotive industry has turned to TMS to track and ensure that shipments arrive on time. TMS is also in high demand because parts for cars are available from all corners of the globe. This creates many opportunities.

Trending Factors

The Increase in the Use of AI and the Cloud In Supply Chain Management

The rapid evolution of the industry landscape is due to the widespread adoption of artificial intelligence (AI), including machine learning (ML) and computer vision technology. Artificial intelligence solutions and services will be more popular as robot autonomy is required to stay competitive in the global transportation management system market. As a result, the global market for artificial intelligence continues to grow due to the advancements in deep learning and data-based AI.

Market growth is being driven by the increasing use of multi-cloud functionality as well as the growing demand for cloud-based intelligence services. Cloud computing is now more valuable thanks to modern AI tools. This is crucial for the integration of new technologies in the sector and for improving overall process viability. AI software can also bridge the technological gap between cloud computing and modern breakthroughs.

The AI cloud allows for the integration of two technologies. AI software and hardware can be combined with cloud computing and artificial intelligence to create an AI cloud hybrid system. This creates a cloud environment that is similar to the human brain.

Hence, the businesses functioning in the transportation management system market are widely adopting and using AI through the cloud delivery of AI software-as-a-service., enabling them to utilize AI capabilities. Oracle recently announced that its ERP platform would be open to customers and partners. It also announced new B2B commerce services and added a variety of enhancements to its supply chain management and enterprise planning management (EPM) Fusion Cloud offerings.

Deployment Mode Analysis

The On-Premise Segment Drives The  Market Growth Globally.

In 2022, the on-premise segment made up more than 57.2%. Many large distribution and manufacturing companies still prefer to use on-premise TMS due to its data safety requirements, easy access to the server, and greater control over customization. As cloud-based TMS becomes more popular, incumbents in various industries will likely choose cloud-based TMS. Over the forecast period, the cloud segment will show the highest growth rate.

The cloud-based TMS provides shippers, logistics providers, and vendors with unique planning and optimization advantages. Cloud-based TMS is becoming more popular as companies continue to increase their data volumes. This is due to its superior configuration capabilities and efficiency.

Cloud-based TMS is more cost-effective than on-premise TMS due to its lower licensing and management fees. As the information is stored on the cloud that can be easily accessible from anywhere is the significant advantage of the cloud-based TMS. The segment growth is expected to be driven by such benefits.

Mode Of Transportation Analysis

The Roadways Segment Dominates The Market Growth Globally

In 2022, the roadways segment made up more than 41.80%. Road freight is one of the most popular modes of transport worldwide. Because it is flexible and cost-effective, it can be loaded and unloaded at any location. Due to the increased dependence of consumers on e-commerce during COVID-19, companies had to increase their delivery options for the roadway segment.

Many governments are simultaneously pursuing initiatives to improve transportation infrastructure. This is expected to increase the demand for logistics via roadways and, consequently, the growth in the roadways segment.

Over the forecast period, the fastest-growing segment will be the waterways segment. This growth can be attributed in large part to the substantial investments made by different governments in TMS for the efficient management and maintenance of waterways.

End-User Vertical Analysis

The Manufacturing Sector Holds The Largest Market Share Globally.

In 2022, the manufacturing sector held the largest share, with over 36.4%. The necessity for outsourcing inventory and raw materials has increased as a result of the rising number of manufacturing units in emerging economies like India and Mexico.

For instance, the “Make in India” initiative launched by the Indian government places a significant emphasis on the growth of the domestic manufacturing sector and may even encourage indigenous manufacturing. Over the course of the forecast period, such initiatives bode well for the expansion of the manufacturing sector.

Over the forecast period, the retail and e-commerce segments are expected to experience a significant increase in sales. This growth is due to unabated growth in the retail and e-commerce industries in countries like India and China. China is responsible for almost 80% of all online sales in Asia-Pacific.

However, India is poised to become the fastest-growing e-commerce marketplace by leveraging strong investments in the e-commerce sector and deeper smartphone penetration. TMS is being used by large e-commerce firms like Alibaba Group Holding Ltd., Walmart Inc., and Amazon Inc. to maintain and strengthen their shipping operations.

Key Market Segments

Based on the Deployment Mode

• On-Premise
• Cloud-Based

Based on the Mode Of Transportation

• Roadways
• Railways
• Waterways
• Airways

Based on End-User Vertical

• Retail & E-commerce
• Manufacturing
• Logistics
• Government Organizations
• Other End-Use Verticals

COVID-19 Impact Analysis

The COVID-19 global health crisis has had a huge impact on most market sectors around the world. One of the most affected markets is still the travel industry. The global market for transportation management system market faces unexpected challenges due to the restrictions on travel and the social distancing rules that governments enforce worldwide. The global market for transportation management system market is expected to expand significantly as a result of all the economic and industrial activities returning back to normal.

Regional Analysis

North America Dominates The Market Growth Globally.

With a revenue share greater than 32.6%, North America was the dominant transportation management system market in 2022. North America is well-known for its high use of roads as the primary mode for transporting freight.

The transportation management system market is driven by the growth in local infrastructure spending for smooth transit. The growth of this market is also being supported by the presence of top TMS vendors such as Infor Inc. and 3GTMS, Cerasis Inc., International Business Machines Corp., and MercuryGate International Inc.

Asia Pacific is expected to experience significant growth over the forecast period. The region’s growth will be driven by the growing retail and e-commerce industries in India and China. Regional growth will also be aided by the various initiatives and policies being taken by companies in the region to promote intelligent transportation.

Key Regions and Countries Covered in this Report:

• North America
  • The US
  • Canada
  • Mexico
• Western Europe
  • Germany
  • France
  • The UK
  • Spain
  • Italy
  • Portugal
  • Ireland
  • Austria
  • Switzerland
  • Benelux
  • Nordic
  • Rest of Western Europe
• Eastern Europe
  • Russia
  • Poland
  • The Czech Republic
  • Greece
  • Rest of Eastern Europe
• APAC
  • China
  • Japan
  • South Korea
  • India
  • Australia & New Zealand
  • Indonesia
  • Malaysia
  • Philippines
  • Singapore
  • Thailand
  • Vietnam
  • Rest of APAC
• Latin America
  • Brazil
  • Colombia
  • Chile
  • Argentina
  • Costa Rica
  • Rest of Latin America
• Middle East & Africa
  • Algeria
  • Egypt
  • Israel
  • Kuwait
  • Nigeria
  • Saudi Arabia
  • South Africa
  • Turkey
  • United Arab Emirates
  • Rest of MEA

Market Share & Key Players Analysis:

In order to improve their products and launch new products in this highly competitive transportation management system market, key players are spending heavily on research and development. MercuryGate International, Inc., for instance, enhanced its TMS system by adding smart transportation features such as embedded analytics and artificial intelligence to it.

The product provides real-time insight into local and global supply chain requirements. Companies are also pursuing different strategies to remain competitive. These include mergers and acquisitions, strategic partnerships, contracts, and agreements.

For example, Infor Inc. partnered in February 2022 with DB Schenker to provide a supply-chain solution. Infor Nexus technology is available to all customers of DB Schenker as part of the partnership. Infor Nexus technology is used by DB Schenker’s Logistics Service Providers (LSP) business to provide a complete supply chain solution that simplifies cost, factory, and transportation management. It also facilitates supplier collaboration and automates shipping. This helps to reduce inventory, reduce costs, and increase supply chain resilience.

Market Key Players:

• 3GTMS
• BluJay Solutions Ltd.
• H. Robinson Worldwide, Inc.
• Cerasis, Inc.
• Inet-logistics GmbH
• Infor Inc.
• International Business Machines Corp.
• JDA Software Group, Inc.
• Manhattan Associates
• MercuryGate International, Inc.
• Oracle Corp.
• SAP SE
• The Descartes Systems Group Inc.
• Trimble Transportation Enterprise Solutions, Inc.
• Other key Players

Recent Developments:

• March 2022: Data cloud company Snowflake and Blue Yonder, a provider of digital supply chains and omnichannel fulfillment, announced a partnership that will transform supply chain management’s ability to access heterogeneous data sources. Blue Yonder’s Luminate Platform powered by Snowflake is available to retailers, manufacturers, and third-party logistics providers (3PLs). This solution helps them better anticipate, prevent, and address disruptions throughout their business, reducing risks and addressing the growing supply chain challenges.
• February 2022: RHI Magnesita is the world’s largest provider of refractory materials. Oracle Fusion Cloud Transportation Management (a component of Oracle Fusion Cloud Supply Chain & Manufacturing) was chosen to support its growth and technological modernization. All of RHI Magnesita’s shipping facilities now use a single integrated transportation management system market to manage all logistics operations. Oracle Transportation Management allowed the company to reduce costs, improve service standards, and automate processes to make its logistics operations more efficient.

Report Scope: