Supply Chain Management Software
BuyerView | 2014

At Software Advice, we speak to prospective buyers from thousands of companies looking for software to better manage their supply chain. We recently analyzed a sample of these interactions taken from 2013 to discover buyers’ most common pain points and reasons for seeking new software. This report outlines the trends we uncovered.

Key Findings:

  1. Half of buyers wanted their supply chain management (SCM) software to provide basic warehouse management functions, such as monitoring the movement of materials.
  3. Nearly a third of buyers were using non-SCM software to manage their supply chain, and were seeking more specific functionality.
  5. The majority of prospective buyers knew they wanted a best-of-breed solution, but remained undecided as to a deployment model.

Half Need Warehouse Management Applications

Nearly 50 percent of the buyers sampled said they were looking for a basic warehouse management application to monitor and control the movement of materials within their warehouse.

Twelve percent of buyers said they needed a transportation management application, which guides the movement of materials to and from a warehouse. Another 12 percent said they were looking for a procurement application, which creates purchase orders and maintains the financial side of supplier/customer relationships.

Top-Requested Applications

Nine percent of our buyers were looking for a supplier management application, which monitors supplier performance and can assess supplier risk based on user-defined categories. Less common applications sought by prospective buyers included order fulfillment (5 percent), strategic sourcing (4 percent) and demand planning (4 percent).

The least popular applications included supply chain planning (3 percent) and vendor-managed inventory (1 percent). These applications may have been less sought-after by prospective buyers because some of the main functions are already gained through a basic supply chain management system, and many buyers don’t need the additional functionality.

Scott Ciurana, president of SF Ciurana Consulting, which specializes in supply chain optimization says he’s seen other supply chain management buyers follow a similar path to those we sampled: many companies tend to start with a simple system that provides a straightforward function before aiming for a solution that’s highly complex.

“There are environments like at Amazon, where a complex system can be beneficial,” he says. “But more often than not, in a lot of these warehouses, too much complexity tends to overcompensate and doesn’t really produce a value-added outcome.”

Nearly One Third of Buyers Using ERP/WMS Software

While a breakdown of prospective buyers’ current SCM methods revealed a great variety of techniques, 15 percent of buyers were using an enterprise resource planning (ERP) system, while another 14 percent were using a warehouse management system (WMS) that was either outdated or lacked the functionality they were now looking for. This combined to make up nearly 30 percent of the sample.

Accounting software either alone (18 percent) or in tandem with a spreadsheet application (7 percent) was the next most-cited method for managing supply chain operations among the buyers we spoke to: combined, this comprised roughly 25 percent of the sample.

Another 18 percent of buyers said they were currently using manual methods—which often referred to pen and paper—to manage their supply chain operations.

Another 14 percent of buyers were using another software system, such as a database management or point-of-sale (POS) system, to manage operations.

Nine percent of buyers we spoke to were using spreadsheets alone—the least common method—to manage their supply chain operations, while less than 5 percent said they were not using any tools for supply chain management at all.

Prospective Buyers’ Current Methods

According to Ciurana, it isn’t uncommon to see smaller supply chain operations relying on accounting software, typically for inventory management purposes. But as inventory volume grows, the margin of error grows with it. Switching over to a more robust warehouse management system is often the best way to keep track of inventory while reducing the likelihood of mistakes, he says.

Most Want Best-of-Breed Solution, Undecided on Deployment

Seventy-two percent of the prospective SCM software buyers we spoke to were interested in evaluating only a “best-of-breed” solution, meaning a single application for supply chain management purposes only.

Integration Preferences

Twenty-three percent of our sample said they wanted an integrated suite, meaning a supply chain management system that also houses applications with non-SCM capabilities, all in one software package. Less than 5 percent of buyers wanted multiple best-of-breed applications.

Surprisingly, 84 percent of the buyers we sampled had not yet made a decision on a deployment model. Eleven percent preferred a cloud-based solution (hosted on the Web) while 5 percent wanted an on-premise one (hosted on their own servers).

Deployment Preferences

Ciurana says some of the hesitation to decide on a deployment model may be rooted in prospective buyers’ concerns about the possibility of cloud-based systems going offline.

Many supply chain distributors, he says, are concerned about losing access to their systems due to a remote server going offline, even for a short period of time: loss of system access often translates to work stoppages and loss of revenue.

Once buyers are fully informed about the reliability of cloud-based systems, however, they tend to favor them.

Majority of Buyers Want to Automate and Organize

When asked why they were evaluating supply chain management software, 38 percent of prospective buyers we spoke to said they were hoping to automate and organize processes within their businesses. Twenty-six percent were looking for a more modern solution for their supply chain management needs—which is unsurprising, given that most buyers were using accounting software or manual methods.

Top Reasons for Software Purchases

Over Half of Buyers From Smaller Companies

Over half of prospective buyers we spoke with were from companies with 100 or fewer employees: Roughly 45 percent of our sample were from a company with fewer than 50 employees (making this the single largest buyer segment), and 7 percent of buyers were from companies with 51-100 employees.

Demographics: Prospective Buyer Size by Number of Employees

A significant amount of buyers were also from companies with between 101 and 500 employees, making up roughly 25 percent of the sample. Interestingly, the very largest companies made up the next-largest segment: 14 percent of the buyers sampled were from businesses with more than 1,000 employees.

Buyers from companies with 501-1,000 employees were the least common, making up just 8 percent of the sample.

Majority of Buyers in Business Leadership Positions

Seventy-four percent of the prospective buyers we spoke to were either business owners, C-suite executives or high-level business managers within the company they were representing. Conversely, only 9 percent of the buyers we spoke to were IT professionals.

This is in line with the rest of our findings, as business leaders are often more involved with making software purchases in smaller companies (in larger companies, this responsibility more commonly falls to IT professionals).

Demographics: Prospective Buyers by Role

The additional professions that made up the buyer sample were a diffuse collection of roles, from consultants to administrative assistants. No other group made up a significant representation within the sample.

Most Buyers From Third-Party Logistics Industry

Thirty-eight percent of the buyers we spoke to were from third-party logistics providers, which offer outsourced logistics and supply chain management services to their customers. This was the single largest industry segment among prospective buyers, followed by the consumer goods and food and beverage industries, which each made up roughly 8 percent of the sample.

Demographics: Prospective Buyers by Industry

Organizations that supply durable goods and medical supplies each made up 6 percent of the sample, followed by companies that handle industrial machinery and equipment, which made up roughly 5 percent of the sample.

The additional industry segments, which fell into the “Other” category, were a loose collection of various industries, with no other single segment representing more than 3 percent of the total.


Seventy-two percent of buyers expressed interest in a best-of-breed solution, revealing a clear favorite over an integrated suite. That clarity was absent, however, when buyers were asked if they preferred an on-premise solution to a Web-based one. Eighty-four percent of buyers remained undecided over how they wanted their system deployed.

Half of buyers said they wanted their supply chain management (SCM) software to provide basic warehouse management functions, such as monitoring the movement of materials. This interest in a simple function alone may have been a factor in the overwhelming majority of buyers who only wanted a best-of-breed solution.

A majority of buyers were still using accounting software to manage their inventory, which is a common method for smaller or newer businesses to use, before they grow to a point where that software is no longer effective.


Software Advice regularly speaks on the phone with organizations seeking new supply chain management software. To create this report, we randomly selected 385 of our phone interactions from 2013 to analyze. If you’d like to further discuss this report or obtain access to any of the charts above, feel free to contact me at

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