Manufacturing Execution System MES Market Trends & Analysis 2020-2027
The global manufacturing execution system market is anticipated to grow from USD 11.10 billion in 2019 to USD 15.65 billion by 2027, the market is expected to attain a CAGR of 4.35% from 2020 to 2027.
The growth can be attributed to growing industrial automation for connected supply chain, stringent government compliances & regulations for industrial processes is expected to foster the market growth by 2027. Recently, many financial institutes have developed policies to keep industries running during the COVID-19 pandemic to avoid economic loss, such initiatives are supporting the growth of the manufacturing execution system.
The global industries are starting operations amidst global economies are uplifting lockdown. The authorities are trying to come up with a vaccine for COVID-19 but they haven’t got any success in the positive direction yet, therefore it has become very crucial for companies to come up with a backup plan to tackle this problem. The manufacturing execution system market is directly dependent on the manufacturing activity, which has been seriously hampered by the COVID-19 lockdown. The market is expected to witness a slower growth till Q2 of 2021, the market is expected to regain its growth rate by 2022.
Government financial bodies of various countries have prepared a backup plan for manufacturing units to tackle the economic slowdown caused by the coronavirus pandemic. For instance, the United States Government has passed a bill named “Coronavirus Aid, Relief, and Economic Security Act”, To financially support five main components individual and family, small and medium businesses, large organizations, public services, state and local government bodies. The Indian government has also launched an economic package of INR 20,000 crore (Approx. $260 Bn) for the Micro, Small, Medium Enterprises (MSME). Similarly, USD 809.5 Bn package under Pandemic Emergency Purchase Programme (PEPP) has been announced by the European Central Bank (ECB) to support small and large businesses and industries in the European region.
Implementation of MES solution is a highly complex process and requires a lot of technical knowledge such as integration with the existing ERP system, connecting the data to be exchanged between MES and ERP solutions using the software. The small and medium businesses refrain from moving from a traditional manufacturing environment to and MES solution, mainly due to the high initial investment required; however, the small and medium enterprises lack awareness about the advantages that an MES solution offers and how it may significantly reduce the operational cost.
The manufacturing exhibition system comprises software that performs various tasks such as product management, Resource Management, auditing, data collection, data analysis, performance management, and much more critical tasks to optimize the manufacturing activities. The MES needs to be integrated with various existing systems such as ERP, decision support system (DSS), business intelligence (BI), supply chain management & monitoring system. Thus, the MES can effectively connect different systems to create a standard workflow and improve productivity through better resource management.
Based on offering the global manufacturing execution system market can be segmented into Software, Services, Implementation, Software Upgrade, Training, and Maintenance. The software segment accounted for the largest market share in 2019, the trend of customized MES is anticipated to drive the market growth over the forecast period.
The services segment plays a crucial role in the manufacturing execution system improving the efficiency of the manufacturing processes and thereby optimizing the production cycle to reduce wastage and improve productivity. MES developing companies offer software and services to their customers, the services generally include technical support including training and implementation, maintenance, and future software upgrades. The process election services help customers to streamline their manufacturing processes for maximum output and minimizing the error and wastage. Growing demand for manufacturing execution systems for streamlining processes post the COVID-19 pandemic to increase the productivity with minimum manpower is anticipated to drive the market growth.
The Global MES market has been segmented based on the deployment into On-premise, Cloud, and Hybrid. The MES cloud deployment segment is growing at the fastest growth rate of 5.5% from 2020 to 2027. The cloud-based solution offers easier installation, less maintenance, and remote accessibility; therefore, most of the new manufacturing units are equipped with a cloud-based MES system. However, data security concerns and a higher possibility of hacking are acting as the main challenge in the adoption of these MES systems.
The On-Premise MES is the largest segment with greater than 60% market share in 2019. Every manufacturing unit has a different set of requirements from the MES and therefore a single system can not be deployed in all types of industries. The companies provide customized MES software to companies based on their requirement, available machinery, and process layout. Hybrid MES is the combination of the cloud and on-premise MES, such software can work in both online as well as offline mode, however, the functionalities are limited and it requires high maintenance and training.
Based on the process industry, the MES market can be segregated into Food & Beverages, Oil & Gas, Chemicals, Pulp & Paper, Pharmaceutical & Life Sciences, Energy & Power, and Water & Wastewater Management. The Pharmaceutical and life science segment accounted for the largest market share in 2019, The pharma companies need to follow tons of government regulations and compliances; therefore they use MES to streamline and standardize their manufacturing processes to maintain standard quality across sites located in different locations worldwide.
The food and beverages segment accounted for the largest market share in 2019, the segment includes various industries such as Fish, Meat, and Poultry, Fruits & Vegetables, Dairy Products, Bakery Products & Confectionery, Snacks & Breakfast Cereals, Prepared Meals & Dishes, Prepared Animal Feeds, Beverages, and Others. Growing demand for packaged food due to changes in lifestyle is driving this segmental market growth.
Asia-pacific manufacturing execution system market to dominate over the forecast period, the number of manufacturing units in the Asia-pacific region especially in China, Japan, South Korea, and Taiwan are considerably higher and they utilize the MES system standardizing their Manufacturing processes. Increasing automation of industries for better productivity is expected to drive the market growth for the manufacturing execution systems between 2020 to 2027.
The Global MES market is fairly competitive in nature with leading technology companies such as Honeywell International Inc., ABB Ltd. Dominating the Global market. Following is a list of all top manufacturing execution system providers mentioned in this report:
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