by Supply chain risk management (SCRM) refers to the identification and management of risks in the supply chain to help ensure business continuity and reduce financial losses from supply chain disruptions. Risks include natural disasters, political instability, infrastructure and technology failures, vendor failures, transportation failures, and regulatory changes. As supply chains become more complex and global with multiple tiers of suppliers, risks have increased exponentially. SCRM solutions help companies assess vulnerabilities, monitor risks, and ensure supply chain resilience through scenario planning and risk mitigation.
The global SCRM market is estimated to be valued at US$ 2.56 billion in 2024 and is expected to exhibit a CAGR of 6.3% over the forecast period 2024 to 2030.
Key Takeaways
Key players operating in the supply chain risk management market are Oracle, SAP, IBM, Avetta, DHL International and MetricStream.
Supply chain globalization offers significant opportunities for expansion into new markets. However, it also brings complexity and transparency challenges that increase risks. Adopting SCRM solutions helps companies have end-to-end real-time visibility and control across global supply chains.
North America dominated the market in 2018 owing to stringent regulations, however Asia Pacific is expected to grow at the highest CAGR during the forecast period with China and India emerging as major manufacturing hubs. Global companies are expanding their supplier networks in Asia Pacific increasing risks that need to be managed.
Market Drivers
Growing supply chain complexity is a major driver for adoption of SCRM solutions. Global sourcing, outsourcing of manufacturing, multiple tiers of suppliers, and just-in-time manufacturing have pushed supply chain networks to unprecedented levels of complexity increasing vulnerability to disruptions. SCRM solutions provide needed visibility, risk assessment, and contingency planning capabilities. Rising demand for transparency across global supply chains is another key driver. Regulations like California Transparency Act are pushing companies to mapping multi-tier suppliers and manage risks proactively.
PEST Analysis
Political: Regulations regarding Supply Chain Risk Management Growth practices are expected to increase over time, driving adoption of such solutions.
Economic: Economic growth and trade expansion, along with volatility will influence supply chain risks, creating demand for management of these risks.
Social: Increased awareness and focus on ESG practices will prioritize responsible supply chain management from social and environmental standpoint.
Technological: Advancements in AI, IoT, blockchain and cloud computing will enable greater visibility across supply chains and aid in proactive risk monitoring and mitigation.
North America accounts for the largest share in the supply chain risk management market in terms of value. This can be attributed to stringent regulations regarding risk management and high awareness levels amongst organizations regarding potential supply chain disruptions. Asia Pacific region is expected to be the fastest growing market over the forecast period owing to rising complexities in supply chain networks driven by globalization of trade in countries like China and India.
The European market currently holds the second largest share and stringent rules framed by EU have compelled companies to focus more on ensuring continuity of their supply chain operations. Specific requirements around compliance are positively impacting growth. China has emerged as global manufacturing hub and therefore faces higher supply chain complexities than other countries making supply chain risk management a priority
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
