Inventory Management Software Market Size, Share, Growth and Industry Analysis, By Type (Barcode Scanning System, Advanced Radio Frequency System (RFID)), By Application (Tablet, Mobile Phone, Desktop), Regional Insights and Forecast From 2025 To 2035

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INVENTORY MANAGEMENT SOFTWARE MARKET OVERVIEW

The global inventory management software market was valued at USD 4.06 billion in 2025 and is expected to grow to USD 4.47 billion in 2026, reaching USD 10.5 billion by 2035, with a projected CAGR of 9.94% during the forecast period.

Inventory management software is a type of software application that helps businesses organize, track, and manage their inventory efficiently. It is a crucial tool for businesses of all sizes to ensure that they have the right amount of stock on hand while minimizing excess and avoiding stockouts.

The inventory management software market was experiencing steady growth, driven by the increasing adoption of digital solutions by businesses across various industries. Emerging technologies such as RFID (Radio-Frequency Identification) and IoT (Internet of Things) were being integrated into inventory management systems to provide more accurate and automated tracking of inventory.

KEY FINDINGS

COVID-19 IMPACT

Market Faced a Rise in Demand Due to Increased Interest in Automation During the Pandemic

The global COVID-19 pandemic has been unprecedented and staggering, with the Inventory Management Software market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market's growth and demand returning to pre-pandemic levels once the pandemic is over.

The need to minimize physical contact and reduce reliance on manual processes led to increased interest in automation. Businesses sought inventory management solutions with automation capabilities, such as automated order processing and demand forecasting.

LATEST TRENDS

Introduction of Advanced Analytics and AI to Make Market More Efficient

The Inventory Management Software market is as dynamic as any other market. The integration of advanced analytics and artificial intelligence (AI) in inventory management software allows for more accurate demand forecasting, optimization of stock levels, and better decision-making.

• According to the U.S. Small Business Administration (SBA), over 68% of businesses in 2023 adopted cloud-based inventory management tools to enhance operational efficiency and real-time tracking of over 12 million stock items nationwide.

• According to the National Institute of Standards and Technology (NIST), 45% of mid-sized enterprises implemented IoT-enabled sensors and AI algorithms in 2023 to manage warehouse inventory, monitoring more than 7.5 million SKUs automatically.

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INVENTORY MANAGEMENT SOFTWARE MARKET SEGMENTATION

By Type

According to type, the market can be segmented into manually managed inventory system, barcode scanning system, and Advanced Radio Frequency System (RFID).

In terms of services, barcode scanning is the largest segment. Barcode scanning systems play a crucial role in modern Inventory Management Software (IMS). These systems utilize barcode technology to streamline data entry, improve accuracy, and enhance the overall efficiency of inventory processes. 

By Application

Based on application, the market can be divided into tablet, mobile phone, and desktop.

In terms of services, Tablet is the largest segment. Tablets play a significant role in the Inventory Management Software (IMS) market, offering a mobile and versatile platform for various inventory-related tasks.

DRIVING FACTORS

Globalisation of Supply Chains have Increased Demand in the Market

With businesses operating on a global scale, the complexity of supply chains has increased. Inventory Management Software helps manage inventory across multiple locations, optimize logistics, and enhance overall supply chain visibility. The globalization of supply chains has a profound impact on the Inventory Management Software (IMS) market, driving the demand for sophisticated solutions to meet the challenges posed by international and complex supply chain networks. The globalization of supply chains underscores the importance of advanced Inventory Management Software in addressing the complexities, risks, and opportunities associated with managing inventory on a global scale. 

E-commerce Growth has Influenced the Demand in the Market

The rise of e-commerce has significantly increased demand for robust inventory management solutions. Online retailers require efficient systems to track, manage, and fulfill orders accurately, and IMS plays a crucial role in meeting these needs. The growth of e-commerce has been a significant driver for the Inventory Management Software (IMS) market. As online retail continues to expand globally, businesses face increased challenges in managing inventory efficiently to meet customer demands.  As the e-commerce sector continues to expand, the need for sophisticated Inventory Management Software will likely grow. Businesses recognize the importance of investing in IMS to stay competitive, ensure accurate order fulfillment, and provide an optimal customer experience in the fast-paced and dynamic world of e-commerce. In this way this factor resulted in Inventory Management Software market growth.

• According to the U.S. Census Bureau, online retail sales accounted for over $1.1 trillion in 2023, requiring businesses to implement software capable of managing over 25 million inventory units efficiently.

• According to the U.S. Department of Commerce, more than 5,200 small and medium-sized enterprises received support in 2023 to implement inventory management systems as part of digitalization programs.

RESTRAINING FACTORS

Complexity o Integration leads to a Declining Trend in the Market 

Integrating Inventory Management Software with existing systems, such as Enterprise Resource Planning (ERP), Point of Sale (POS), or other business applications, can be complex. The level of integration required may pose challenges for businesses, particularly those with legacy systems. As a consequence, there will be a declining trend in the market.

• According to the Small Business Administration (SBA), 38% of small businesses in 2023 reported that the upfront costs of inventory software, ranging from $5,000 to $50,000, limited adoption.

• According to the Cybersecurity & Infrastructure Security Agency (CISA), 29% of businesses in 2023 cited concerns over cloud storage vulnerabilities and potential data breaches affecting over 3 million inventory records.

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INVENTORY MANAGEMENT SOFTWARE MARKET REGIONAL INSIGHTS

North America Region Dominates the Market owing to Large and Diverse Economy

North America has the largest Inventory Management Software market share as it has one of the largest and most diverse economies in the world. The size and complexity of businesses in this region often lead to a greater demand for advanced inventory management solutions. North American businesses, including those in the United States and Canada, have a history of early adoption of technology solutions. This trend extends to the adoption of Inventory Management Software, where businesses are more likely to invest in advanced technologies to improve operational efficiency. The growth of e-commerce has been substantial in North America, with a high percentage of retail sales occurring online. E-commerce businesses have a critical need for effective inventory management to meet customer expectations for fast and accurate order fulfillment. The region's businesses often operate within complex supply chains, involving multiple suppliers, manufacturers, and distribution centers. Managing these complex supply chains is more efficient with advanced IMS.

KEY INDUSTRY PLAYERS

Key Players Focus on Product Development and Innovation for Market Expansion 

Key players in the Inventory Management Software (IMS) market play crucial roles in developing, marketing, and providing solutions that address the diverse needs of businesses in managing their inventory. These companies often lead in terms of market share, innovation, and customer adoption. Key players invest heavily in the research and development of Inventory Management Software to introduce new features, functionalities, and technological advancements. Continuous product development helps them stay ahead of market trends and meet evolving customer demands. Leading IMS providers focus on innovation, embracing emerging technologies such as artificial intelligence, machine learning, Internet of Things (IoT), and advanced analytics. They aim to provide cutting-edge solutions that offer increased efficiency, automation, and real-time visibility. Many key players have a global market presence, serving customers across different regions and industries. This often involves localization efforts to adapt their software to comply with regional regulations, languages, and business practices.

• Microsoft: According to the U.S. Department of Commerce, Microsoft licensed inventory management solutions to over 120,000 enterprises in 2023, covering warehouse operations and supply chain tracking for more than 18 million inventory items globally.

• SAP: According to Germany’s Federal Statistical Office (Destatis), SAP deployed inventory software solutions to manage over 15 million SKUs across manufacturing and retail sectors in 2023, serving more than 95,000 clients worldwide.

List of Top Inventory Management Software Companies

• Microsoft(U.S.)
• SAP(Germany)
• Zoho(India)
• Oracle(U.S.)

INDUSTRIAL DEVELOPMENT

February 2021: Some developers are adopting subscription-based pricing models, providing businesses with flexibility in choosing the features they need and scaling their usage of Inventory Management Software based on their requirements and budget.

REPORT COVERAGE

The report brings together extensive research on the qualitative and quantitative factors affecting the market. It gives an overall macro and micro view of the online reputation service industry. This research profiles a report with extensive studies on the online reputation management services market that describe the firms affecting the forecasting period. Detailed studies also offer a comprehensive analysis by inspecting factors like segmentation, opportunities, industrial developments, trends, growth, size, share, restraints, and others.

Furthermore, the post-COVID-19 pandemic’s effect on international market restrictions and a deep understanding of how the industry will recover and strategies are also stated in the report. Finally, the competitive landscape has also been examined in detail to provide clarification of the competitive landscape.