An overview of the WMS vendor landscape using the Gartner® Magic Quadrant™
The right Warehouse Management System (WMS) can help your business streamline operations by optimizing resources, workflows and processes while providing full visibility into the performance of your supply chain. Ultimately, a WMS can help your business save time and reduce costs, while improving efficiencies and maximizing customer satisfaction by delivering a seamless experience. The rationale for implementing a WMS is clear. However, selecting the right WMS for your business can be a complicated process with many dimensions to consider.
With a handful of dominant players in the industry, one might assume that choosing one of these well-known brands will deliver a quick and easy answer. However, digging deeper, you may find that not every WMS will be suitable for your business, considering costs, expertise, features, quality, scalability and flexibility. In fact, several WMS vendors are challenging entrenched market leaders by offering WMS solutions that are better suited for different company use cases.
Looking at these industry dynamics, at K2S, we have decided to take a different route from other supply chain execution consultants by focusing on the holistic WMS market and not locking our customers into one WMS technology. To better suit the evolving needs of our customers, we’ve embarked on a journey to become application-agnostic by opening up our services to cover several WMS applications.
With this vision in mind, it has become important to gain an in-depth understanding into the different WMS players. Using the “Magic Quadrant for Warehouse Management Systems” report by Gartner, we have created an overview of the landscape to support you in your decision making. We hope you will find this a useful resource.
Understanding the WMS Landscape
According to Gartner, the WMS market has received an impressive stage of maturity, with a forecasted growth to over $4 billion by 2026 and a 5-year CAGR of over 13%. The report goes on to break down the WMS market into a Magic Quadrant which analyzes the following four types of vendors:
- Application mega vendors that offer broad portfolios of applications across most application categories and a range of Supply Chain Management (SCM) solutions (e.g. back-office financials, customer relationship management, order management etc.), but may not always provide an integrated platform
- SCM suite vendors that offer comprehensive WMS solutions along with a portfolio of applications focused primarily on SCM either with or without an integrated platform
- Specialist WMS suite vendors that function as independent software vendors (ISVs), focusing primarily, but not necessarily exclusively, on holistic WMS suites. They may also offer additional, complementary capabilities but these remain a modest part of their businesses
- Material handling/equipment/automation vendors that often focus on providing the electromechanical aspects of large-scale warehouses but may also extend to other WMS capabilities as part of their product portfolios
Based on the above framework, WMS vendors were reviewed following a robust list of 18 criteria. This included their capabilities and track-record, innovation and vision for next-generation WMS, cloud architecture and deployment, product differentiation, ability to deliver value, customer service and satisfaction, as well as other dimensions.
Leveraging their careful assessment, Gartner mapped the WMS vendor market into four quadrants (Leaders, Visionaries, Niche Players and Challengers) by measuring the different vendors in terms of their Completeness of Vision and Ability to Execute, providing a useful overview to understand the strengths of each company:
For more context, let’s review some of the major players in each quadrant, their products and positioning:
Leader: Blue Yonder
- The largest SCM suite vendor in the Quadrant with an impressive revenue of around $1.25 billion in 2022 and close to 1,000 WMS customers.
- Acquired by Panasonic in 2021, Blue Yonder offers various SCM solution suites such as WMS, workforce/labor management, transportation management, supply chain planning, merchandising and retail planning
- In 2023, Blue Yonder and Accenture announced an expansion of their strategic partnership. Accenture will be providing access to their technology and domain expertise to support Blue Yonder in the engineering and delivery of new WMS solutions and capabilities
- According to Gartner, this application stands out for its maturity, adaptability, diverse customer base, future focus and both core and extended WMS functionalities that leverage technologies for innovation
WMS Visionary: Softeon
- A mostly privately held SCE solution provider with 24 years of experience, 165 customers and $45 million total revenue - 89% of which comes from WMS
- Softeon has a noteworthy SCE convergence vision and portfolio despite warehousing being its core business, integrating direct store delivery, transportation and planning into a single technical platform
- According to Gartner, Softeon’s strengths lie in its compelling value proposition, combining cutting-edge technologies, rich WMS functionality and innovative, broad and differentiated capabilities
Niche Player: Generix Group
- With $89 million in revenue, WMS accounts for more than 50% of the Generix Group’s business
- Generix offers two distinct WMS solutions, as well as logistics order and replenishment management, electronic data interchange (EDI), transportation and yard management, as well as other SCM offerings
- With 464 WMS customers, Generix has a stronger presence in Europe with 72% of its customer base being located in the region, accounting for 80% of its revenue. Around 20% of its customers are based in North America and the remainder are distributed in other regions
- According to Gartner, Generix stands out because of its growing global presence, support for SCE convergence through complementary products and the powerful tools, architecture and WMS-MES integration of its signature solution SOLOCHAIN, which was initially developed by its North American business unit
- Providing warehouse management and allied SCE capabilities for the last 40 years, Tecsys boasts approximately $105 million in software and services revenue, with the majority tied to WMS
- Tecsys has 214 WMS clients with a strong market position in healthcare and life sciences where it offers unique capabilities, compliance, domain expertise, customer experience and strategic partnerships
- According to Gartner, its strengths lie in its relatively broad SCE offerings including both core and extended WMS, complementary capabilities like its DOM solution, and a robust and flexible rule engine
The One to Watch: Microsoft
- A new entrant in Gartner’s Magic Quadrant and a Challenger, Microsoft is a $198 billion global application and infrastructure megavendor
- Microsoft generates more than $2.25 billion in revenue from its standalone WMS-capable Dynamics 365 applications
- As a combined cloud ERP solution, it provides Microsoft Dynamics 365 Finance and Supply Chain Management (which includes WMS capabilities)
- Its clients are widely dispersed geographically, with 35% of them in North America, 50% in EMEA and 15% being based in Asia.
- Microsoft has over 850 warehouse management clients. The majority are midsize businesses
- Advantages include functionality, ease of use, appealing price, a wide range of technological options and one of the most extensive ecosystems of international, regional and local partners.
The benefits of Leaders
All the application providers reviewed in the Gartner report support basic core WMS capabilities. However, companies in the “Leaders” quadrant, such as Blue Yonder (formerly JDA), Körber (formerly HighJump) and Manhattan Associates, offer additional value-added capabilities through a comprehensive portfolio of applications focused primarily on SCM.
Due to their scope and scale, these WMS solution suites are ideal for companies with complex operations, robust order volumes, dynamic inventory levels and a high need for in-depth data and reporting into warehouse movements, resourcing and supply chain performance for optimal decision making. Such companies will see their WMS as an essential component to their overall business success.
While speed of implementation and usability will be important, capability, scalability and flexibility will be more important factors with such companies being prepared to invest significantly into their WMS to reap long-term benefits. Adopting a strategic outlook, such companies will also consider the WMS provider’s future development roadmap and innovation, including their readiness for robust cloud-based solutions.
WMS Leaders are recognised for their reliable solutions and their ability to deliver at scale. However, for companies at different stages, in specific industries or with particular use cases, other WMS applications from other quadrants may be better suited to tailor to their immediate needs.
The case for Visionaries, Niche Players or Challengers
While WMS implementations can add tremendous value to any organization, anyone involved in large-scale WMS projects will have “war stories” to share of the complicated work involved to achieve success, often resulting in long timelines and high costs. With over 18 years’ average experience in WMS implementations, our experts Ankit Agarwal, who leads our technical and operational teams to support our clients, Scott Ehlke, one of the original technical architects of the Blue Yonder application, and Juwon Obadina who has worked on both Manhattan and Blue Yonder, have many such stories to tell.
We turned to them to understand better how vendors in the Visionary, Niche Player and Challenger quadrants could offer significant value by addressing common WMS concerns. Based on their answers, we’ve crafted the following FAQ:
“I have heard that a WMS takes months to implement successfully.”
This is a common concern and rightfully so. WMS implementations for large-scale operations can be immensely complex, factoring in innumerable variables and parallel work streams. One minor oversight can have a domino effect on the whole system, causing major disruptions and delays.
While choosing a partner that will consider both warehouse technical services and warehouse operational services aspects to drive your WMS implementation is key to success, choosing a more focused WMS that is fit for your organization minus the complexity may enable a faster implementation process.
“We need to streamline our processes and operations but I’ve heard a WMS can complicate tasks.”
We believe that a successful WMS implementation is defined by ease of use. As we like to say: “If it’s boring, then we know we’ve done our job right!” Anyone walking into your warehouse should be able to follow your processes.
While this should be the outcome of even the most complicated implementations, choosing a WMS application with built-in functionalities tailored to deliver to your requirements from the start may deliver a smoother implementation and user experience for everyone involved. Hence, it is advisable to first look at WMS solutions focused on your organization’s use case or niche in your decision making process.
“Our company is considering implementing a WMS but we’re concerned about the prohibitive setup and maintenance costs.”
Implementing a WMS may be expensive indeed but this is where considering vendors from the other quadrants may have significant value. Thinking about the stage of your business, the complexity of your operations and the functions and features needed by the organization, you may be able to identify a WMS application that is fit for purpose, while being within budget.
“I feel we need a WMS for our company but I have been questioned about the ROI for smaller companies.”
The right WMS can have a significant upside for any business. Having said that, for early and mid-tier companies that need to streamline their operations, WMS vendors from the Leaders quadrant may not be the most suitable option.
Growing companies may benefit more from WMS applications that can better tailor to their immediate needs by being less costly, while still delivering all the benefits expected from a WMS. By choosing an accessible solution that is right for the business and working with the right partner to successfully implement the application, the company should see significant ROI from this investment in the short and long-term.
“Our company is in a very specialized niche. I’ve heard we will need a significant amount of customization to any WMS.”
Companies in highly specialized niches with very specific requirements may definitely benefit from choosing WMS vendors from the other quadrants. Focusing on specific industry verticals, such niche players may have specific functionalities built into their software to cater to your industry nuances and may have a relevant ecosystem of partnerships in place to support you in more ways.
By choosing the right WMS from the start, it may be possible to keep customizations to a minimum, while still achieving your objectives. This may be beneficial, as it will reduce complexity during implementation, reign in costs and ensure ease of use for your team.
Clearly choosing the right WMS for a company’s use case, niche and size is important to overcome obstacles and concerns often faced in WMS implementations. A useful tool to delve into this deeper and guide your particular organization is the Gartner WMS Critical Capabilities Report, where various WMS solutions are benchmarked based on different use cases. Taking into consideration different levels of operational complexity and sophistication, this is a great report to research and compare specific WMS products in more detail.
Choosing the right WMS for your company should always be driven by your specific use case and requirements. Whether the WMS is a Leader, Visionary, Niche Player or Challenger is not important. At the end of the day, what matters is that your business achieves its goals and has the right tools to do so, irrespective of the system in use.
At K2S, our mission has always been to fully understand our clients’ needs first and to tailor solutions based on those specific requirements, because we know one size does not fit all. With the WMS landscape evolving and our clients’ needs changing, adopting an application-agnostic approach to WMS implementations, feels like a natural next step in our own evolution.
At every stage from design to go-live, our focus is on ensuring our clients achieve success with their WMS. Our supply chain execution team brings both technical and operational expertise to the table, which we harness to create tailored solutions that perfectly meet your specific warehousing needs.
Contact us to discover more about how we can help you achieve WMS success!