Warehouse Management Vendors Gaining Power Through RFID?
Filed in archive Software Applications by Anita Campbell on November 17, 2004
For instance, I heard this quote by an IBM representative who appeared on a panel discussion about RFID last week: "The warehouse management vendors are the new powerful competitors. That's because they control all the data for everything going through the warehouse."
And this write-up by research company ARC Advisory Group suggests a similar central role for warehouse management vendors:
"The worldwide market for Warehouse Management Systems (WMS) experienced a rough year. Year over year revenues (2003 as compared to 2002) have shrunk. Total revenues dropped by 2.7 percent. According to Steve Banker, Service Director for Supply Chain Management at ARC Advisory Group, 'Even more worrisome, because it is a key future predictor of growth, is that software revenues shrank by 6.9 percent. In other enterprise software markets we have examined, this has been a precursor to several years of shrinking revenues for a market.'
According to Dr. Banker, one question many WMS professionals are asking is, 'Can RFID save the WMS market?'"
The ARC report further suggests a common-sense migration path for warehouse management vendors. First they start with an Add-on
RFID module. Then they can provide an RFID-enabled upgrade to their products. Eventually they will offer new RFID-enabled warehouse management systems packages.So who are the warehouse management systems vendors who stand to gain the most? According to Steve Banker of ARC:
"We did a survey of 21 companies actively making investments in RFID infrastructure because of mandates. The primary technology partner was identified as a WMS supplier 32 percent of the time and a large global conusultant 21 percent of the time. Other types of providers -- like hardware, middleware, and boutique consultants made up the remainder. No one WMS company appeared to be dominant in winning deals. The market for RFID solutions is very fragmented."
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