Miki Lumnitz’s Weblog

PLM for SMB Market growth as part of overall SMB Enterprise Applications Market growth

I have just read an article by BusinessWire “Small and Medium-Sized Business Enterprise Applications Market to Grow to $80.3 Billion by 2012, IDC Finds“

In this article IDC forecasts that the small and medium-sized business (SMB) enterprise applications market will grow to $80.3 billion by the end of 2012, representing a 10.6% compound annual growth rate (CAGR) for the 2008-2012 period. Additionally, IDC finds that there will be increased spending by small and midsize businesses across the entire spectrum of enterprise application segments over the forecast period.

“With an onslaught of software vendors seeking to capture the growth opportunity in the increasingly lucrative SMB segments, a leadership position will be awarded to those that shape their operating model around increasing customer value,” says Judy Hodges, research manager, Small and Medium Business Markets: Enterprise Applications. “In such a highly competitive marketplace, improving customer value is a market leader’s imperative.”

Based on PLM analysts reports, we know PLM expected growth in the SMB is around 17%, which means PLM growth rate is even higher than the general SMB enterprise applications market.

PLM for SMB needs

IDC report also on additional key findings examined, specifying the needs of the SMBs in general. If you remember my post Do Mid-Market companies need to adopt PLM? where I wrote about the needs in the SMB companies, you will see lots of similarity. The key needs based on IDC are:

• The growing needs of SMBs to automate their business processes and meet regulatory compliance means that opportunities will abound in this market. Enterprise applications providers that lead their selling efforts with their solutions’ capabilities for managing these challenges will profit most.
• The SMB markets are extremely competitive and vendors looking to claim a significant share of the expanding opportunity will need to differentiate themselves through delivery of industry-specific functionality for micro-verticals and localized products to appeal to the global needs and support concerns of fast-growing SMBs.
• Vendors will need to ensure more rapid delivery of their applications for time and budget-constrained SMBs by offering fixed scope in-house installations at predictable costs and on-demand subscription programs.
• When searching for new packaged solutions to run their businesses, small firms will seek those that have the non-technical user in mind, require no training, and provide immediate value.