Realizing Global Trade Management Potential
Source: ARC Advisory Group - Steve Banker, director of supply chain solutions at ARC Advisory Group, predicts an average growth rate of 9.4 percent annually for GTM software through 2014.
February 24, 2011
Let’s cut to the chase: Global Trade is on a tear.
According to the World Trade Organization’s (WTO) latest numbers, global trade grew by 13.5 percent in 2010 after falling 12.2 percent in 2009. It was the fastest-ever annual expansion in global commerce, reports the WTO—which originally forecasted a 10 percent increase—and an unexpected jump that comes on the heels of a long-awaited economic recovery.
Last year’s global trade expansion also marked the fastest year-over-year growth ever recorded in a data series that dates back to 1950, according to the WTO, and is sure to bring even more shippers into the international market in 2011. Which begs the question: Will those companies be ready to handle the rigors and challenges of doing business overseas?
The quick answer is “no,” particularly in regards to the IT necessary to navigate the increasingly complex maze of global trade. According to ARC Advisory Group’s latest Global Trade Management (GTM) Worldwide Outlook Study, most small and midsize companies still rely on manual processes to manage their global trade operations, particularly their exports. Not only is this approach costly and inefficient, ARC reports, but it also makes it difficult or impossible for companies to remain in compliance with Customs regulations.
“The fact that companies need to stay on top of trade content, which is changing all the time, is a key driver of GTM sales,” says Steve Banker, director of supply chain solutions at ARC Advisory Group.
The need for better, more efficient trade compliance and new demands for electronic notifications (which must now be filed before goods are shipped to certain countries) are buoying the GTM market, which, like many other supply chain software sectors, saw sales flatten when the nation was in the throes of recession.
Expect that situation to turnaround in 2011, says Banker, who predicts an average growth rate of 9.4 percent annually for GTM software through 2014. “That’s fairly strong growth in one of the fastest-growing segments of the software industry,” says Banker.
Over the next few pages, we’ll delve deeper into the GTM space to find out who’s using the software, how it’s being used, and what new developments will come to market this year. Then, we’ll show you how one shipper is using GTM to work smarter, better, and faster in the global economy.
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