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      Is India a goldmine for ERP suppliers

      Posted AtCXO Today

      Manufacturing companies in India are investing in Enterprise Resource Planning (ERP) solutions in order to improve their manufacturing operations. ERP suppliers, both global and homegrown, will find India an important marketplace for their businesses, says a new ARC Advisory Group study, "Enterprise Resource Planning Outlook for India."

      The Indian ERP market is expected to grow at a CAGR of 25.2% over the next five years. According to the study, the market was $83 million in 2004, and is forecasted to be over $250 million in 2009.

      Manufacturing companies operating in India face the challenge of having to improve their competitiveness. With the country remaining a low cost economy, they are battling against declining prices and a squeeze on their margins. These challenges drive manufacturers to realize that business decisions should be based on real-time information, resulting from synchronized business and production processes, says the study.

      "Manufacturers in India are increasingly implementing ERP solutions to ensure that decision makers have the required information visibility across the value chain," according to ARC senior analyst Libi Baskaran, the study's author.

      The Indian economy is closely integrated with the global economy and is emerging as a low cost production center for a wide range of products produced to meet the demand arising from both domestic and export markets. As a result of India's sustained economic growth over the last few years, the country is emerging as a demand centric economy. Indian and global companies in the marketplace are subjected to intense competitive pressures.

      According to the report, these increasingly competitive pressures drive Indian manufacturers to deliver high quality products at lower prices. Manufacturers, challenged to meet these pressures, seek to optimize their sourcing, manufacturing, and distribution decisions. Indian manufacturers, as they gear up to become more productive and price competitive, have realized the value of ERP solutions. This realization is leading to the growth of the ERP business.

      The majority of Indian manufacturing companies are small by global standards, requiring easy-to-use ERP solutions to meet their specific process requirements, including localization needs to address the continually evolving tax and statutory requirements. SMBs are spread across different industry verticals and micro verticals, such as automotive, pharmaceuticals, and textiles, notes the study.

      September 09, 2005


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