The global warehouse management system market size is expected to grow from USD 2.8 billion in 2021 to USD 6.1 billion by 2026, at a CAGR of 16.7%.


A warehouse management system (WMS) is a software application that helps manage operations in warehouses most efficiently and productively. Functions of these systems include inventory control, labor management, yard management, and dock management, among others. A WMS can be deployed on premises or can be accessed through cloud servers maintained by WMS vendors. Based on their feature and functionality, WMS software packages are available in three-tier types—advanced (tier 1), intermediate (tier 2), and basic (tier 3). Based on offering, the software segment is expected to account for the largest size of the WMS market from 2021 to 2026. Based on deployment, the cloud WMS market is projected to grow significantly during the forecast period.


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Based on offering, the software segment is expected to hold a larger market share from 2021 to 2026. Increasing awareness about WMS software among small and mid-sized enterprises (SMEs), the globalization of supply chain networks, and the growing share of cloud-based WMS software solutions are the key factors boosting the demand for WMS software. Further, the rising demand for highly sophisticated warehousing and logistics infrastructure is expected to drive the growth of the WMS market for software. For instance, in May 2020, Manhattan Associates announced a new Manhattan Active warehouse management solution, a cloud-based enterprise-level warehouse management system that combines every aspect of distribution and never needs upgrading. The Manhattan Active WMS is sold in multi-year cloud subscription options and can be operated through a mobile phone, tablet, or desktop. Companies innovating offerings and functionalities are enhancing user experience and improving operational efficiency, which is leading the growth of the WMS software market.


Based on deployment, the on-premise deployment held a larger share of the WMS market in 2020. Benefits offered by on-premise WMS include an increased degree of control over the servers and software installed at the location, enhanced security, and improved performance. On-premise WMS solutions are less dependent on the Internet and can be customized easily. However, a high cost is associated with the implementation of on-premise WMS as operators have to own all the related hardware components, along with the licenses of support software required to power WMS. APAC is a huge potential market as multinational companies have started setting up warehouses in this region. Therefore, there is an increased need for inventory management, which is boosting the growth of the on-premise WMS market.


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The warehouse management system market has been segmented into North America, Europe, APAC, and RoW. North America is expected to hold the largest market size for warehouse management systems during the forecast period. Factors such as the rising adoption of cloud WMS solutions, the presence of large companies with global warehousing and distribution operations, the growing e-commerce industry, and developed third-party logistics (3PL) networks are driving the growth of the WMS market in North America. The US is a key contributor to the growth of the WMS market in North America. Companies in the US are shifting most of their operations on the cloud, thereby creating a huge opportunity for the adoption of cloud WMS solutions. Key factors driving the growth of this market include growth in the e-commerce industry, an established ecosystem for manufacturing practices, and the presence of large automotive, pharmaceutical, chemical, and food & beverages companies in the US.