GCC ERP market worth US$270 million by 2008

The Enterprise Resource Planning (ERP) market in the Gulf Cooperation Council (GCC) countries is set to touch an estimated US$270 million by 2008. Al Falak, a Saudi-based ERP solutions vendor believes the retail segment will be one of the fastest adopters in the region.

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By  Maddy Reddy Published  April 26, 2004

The Enterprise Resource Planning (ERP) market in the Gulf Cooperation Council (GCC) countries is set to touch an estimated US$270 million by 2008. According to a study conducted by the Dubai-based Madar Research Group, the GCC region will post a growth of 15% cent CAGR (compound average growth rate) over the years leading up to 2008. The expected growth rate will be considerably higher than the CAGR of 6 to 8% shown by the global ERP markets. “The vibrant growth in the ERP markets is driven by the consistent growth in demand for crucial Customer Relationship Management (CRM) and Supply Chain Management (SCM) modules. While the retail market has never really been placed under the spotlight, as far as implementation of ERP solutions is concerned, the fact remains that retail organisations seeking to optimise resource planning and effectively manage trading activity can benefit greatly from effective ERP implementation,” says Ahmed Ali Ashadawi, president and CEO, Al-Falak. The 23-year old Saudi company, which earns a substantial share of its revenue from PeopleSoft’s back-end ERP solution with Retail Pro’s front-end point of sales (POS) implementations, adds that small and medium enterprises (SME) market have only recently begun to benefit from newer ERP suites that are more flexible and modular, as well as taking less time and money to implement. Speaking at the recent Saudi Retail Forum, held in Jeddah, Ashadawi said: “It is significant that the largest demand for ERP solutions to rest in the retail markets of GCC. While the manufacturing and financial segments of regional markets had the financial means to invest in the costlier ERP solutions of a decade or so ago”. The ERP market value of the GCC region stood at an estimated US$134 million at the end of 2003. Of this, Saudi Arabia’s share alone was US$80 million, with UAE registering second place at US$28 million. The combined CRM and SCM (including procurement) modules made up the largest component of the ERP market, with a 31% market share, followed closely by finance at 23% of the market share and HR with a market share of 21%.

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