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ARC Study: New Road To Success In Transportation Management Systems Market

Compiled By Jill Jusko A weak economy didn't stop respectable growth in the transportation management systems (TMS) market, which expanded by almost 7% in 2002, according to the ARC Advisory Group. However, while the future continues to look positive, new challenges are on the horizon, suggest the results of a recent study by the Dedham, Mass.-based advisory firm. The focus for TMS solutions will move from outbound operations to inbound, states Adrian Gonzalez, director of ARC's Logistics Executive Council. "The economic environment and competitive landscape are forcing companies to find new ways to reduce costs and improve productivity," Gonzalez says. "And taking greater control of your inbound processes is the low-hanging fruit." Four factors will define long-term success for TMS vendors, says the research firm. Those are:

  • scope of the solution;
  • net value (realized benefits minus total cost of ownership);
  • financial stability of the solution provider;
  • having a global presence.
ARC predicts a cumulative annual growth rate (CAGR) of 11.6% for the TMS market over the next five years, from $860 million to over $1,489 million in 2007. A complete version of ARC's TMS report is available for $4,900.
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