Smart Warehousing Market by Offering (Hardware, Software, Services), Technology (AI & Analytics, Robotics & Automation), Application (Inventory Management, Predictive Analytics), Warehouse Size, Vertical and Region - Global Forecast to 2028
[339 Pages Report] The smart warehousing market is projected to grow from USD 20.4 billion in 2023 to USD 40.5 billion by 2028, at a compound annual growth rate (CAGR) of 14.6% during the forecast period. Due to various business drivers, the smart warehousing market is expected to grow significantly during the forecast period. The market is experiencing significant growth due to the increasing incidents of phishing emails and ransomware, and need to ensure consistent adherence to security policies and facilitates audit trails. The rising cybersecurity threats and complexity, growing ability to detect and respond to security incidents in real-time is also responsible for driving the market’s growth.
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Market Dynamics
Driver: Rising focus on green initiatives and sustainability to minimize waste
The rising emphasis on green initiatives and sustainability, aimed at minimizing waste and reducing environmental impact, serves as a compelling driving force for the adoption of smart warehousing solutions in the market. These solutions employ advanced technologies like IoT sensors and automation to optimize resource utilization, energy efficiency, and waste reduction within warehouses, aligning with eco-friendly practices. Smart warehousing solutions promote energy efficiency through technologies like LED lighting and real-time data analytics, optimize transportation to reduce fuel consumption and emissions, and minimize waste through improved inventory management. They also contribute to resource optimization, support recycling and circular economy efforts, aid in regulatory compliance, and align with consumer preferences for environmentally responsible practices. Furthermore, by reducing operational costs and enhancing efficiency, smart warehousing solutions offer ecological and economic benefits, making them a vital component of modern, sustainable supply chain management.
Restraints: Data security privacy concerns
Enterprises adopting smart warehousing solutions face security and privacy issues. They possess confidential data, which needs to be protected to avoid data breaches and thefts, as it may affect the reputation of enterprises. The enterprises’ data may leak over the internet and can be accessed by unauthorized users, which is a growing concern. Cloud technology is a growing trend in the warehouse industry. IoT and automated material handling equipment have digitized warehouse operations, and the adoption of cloud technology has further transformed the warehousing and supply chain industry. The use of cloud technology has given rise to certain cybersecurity threats, including data privacy and security concerns, which arise with the rising complexity of smart warehousing solutions.
Opportunity: Advent of AR and VR technologies to streamline warehouse operations
Leveraging AR and VR technologies for warehouse management activities like order allocation, inventory control management, order picking, and material handling can simplify and improve complex warehouse operations, thereby enhancing supply chain processes. Moreover, AR and VR technologies are utilized to enhance worker training, improve operational efficiency, and provide real-time guidance. AR headsets or mobile devices overlay digital information onto the physical environment, assisting workers in locating items, navigating the warehouse, and performing tasks more effectively. VR simulations create immersive training environments for workers to practice skills, emergency response procedures, and equipment operation. For instance, DHL has successfully tested and implemented AR warehouse operations to improve its productivity. Using AR smart glasses, the company was able to use vision picking, which relies on remotely handling an order by picking the correct item and recording information about it without physically touching it. Furthermore, BMW uses AR and VR technologies to improve its production system and warehouse operations. The company’s employees use smart monitors to display information about the piece they’re working on, share it with other employees, and interact with the management by delivering the information that appears in the worker’s field of vision. Adopting AR and VR technologies in smart warehousing improves efficiency, reduces operational costs, minimizes errors, enhances safety, and provides a more agile and responsive supply chain. Thus, it creates significant opportunities in smart warehousing market as companies seek innovative solutions to remain competitive in an increasingly digital and automated world.
Challenge: Slow adoption of smart warehousing solutions due to high capital investment
The digitalization of warehouse operations requires high capital investments that involve the installation of automation equipment, software, and solutions, which incur heavy expenses. The replacement of existing processes is very costly. Another factor hindering the growth of the smart warehousing market is the slow adoption due to the integration complexities of multiple IoT platforms, numerous protocols, and a large number of APIs. The adoption of smart warehousing solutions is not picking up pace, due to the reluctance of organizations to shift from manual practices to the digitalized process involving high capital re-investment. Most enterprises have a laid-back attitude toward new digital technologies and use their intuition rather than adopting digital technologies to make informed business decisions. Hence, companies with limited financial resources are unable to opt for automation warehouse systems, thereby acting as a restraint to the growth of the smart warehousing market.
Smart Warehousing Market Ecosystem
By software by deployment mode, on-premises software segment to account for a larger market size during forecast period
The on-premises deployment of smart warehousing hardware, solutions, and services is a more commonly used practice that offers enterprises the power to manage risks, business processes, and industry policies and enable compliance management. Security and compliance are major concerns for businesses to manage the ever-increasing demand for managing complex warehouse operations. The adoption of on-premises smart warehousing solutions reduces the security risk of handling a huge amount of logistic data.
By technology, IoT registers the highest CAGR during the forecast period
IoT technology has revolutionized the smart warehousing market by providing real-time visibility and control over inventory and operations. The growth of IoT in this sector is primarily driven by its ability to enhance supply chain efficiency, reduce operational costs, and improve inventory management. IoT sensors and devices enable continuous monitoring of warehouse conditions, such as temperature, humidity, and security, ensuring that goods are stored in optimal conditions and reducing the risk of spoilage or theft.
By region, North America holds the largest market size during the forecast period
North America will lead the smart warehousing market in 2023. North America, comprising the United States and Canada, is known for its advanced technology infrastructure and innovative industries, making it a hub for adopting smart warehousing technologies. The region's strong technology ecosystem and continuous innovation make it a key player in driving the development and adoption of these solutions globally.
Key Market Players
The smart warehousing solution and service providers have implemented various types of organic and inorganic growth strategies, such as new product launches, product upgrades, partnerships, and agreements, business expansions, and mergers and acquisitions to strengthen their offerings in the market. Some major players in the smart warehousing market include Manhattan Associates (US), Korber (Germany), Oracle (US), SAP (Germany), Tecsys (Canada), PSI Logistics (Germany), PTC (US), Reply (Italy), Infor (US), IBM (US), Blue Yonder (US), Generix Group (France), Microlistics (Australia), ABB (Switzerland), Microsoft (US), Epicor (US), Made4net (US), Mantis (US), Softeon (US), Synergy Logistics (US), E2open (US), Vinculum (India), Mecalux (Spain), SSI Schaefer (US), WareIQ (India), Foysonis (India), Increff (India), Locus Robotics (US), ShipHero (US), Cin7 (US), EasyEcom (India), Unicommerce (India), and IAM Robotics (US).
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Report Metrics |
Details |
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Market size available for years |
2017–2028 |
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Base year considered |
2022 |
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Forecast period |
2023–2028 |
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Forecast units |
USD (Billion) |
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Segments covered |
Offering, Technology, Application, Warehouse Size, Vertical, and Region |
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Geographies covered |
North America, Asia Pacific, Europe, Middle East & Africa, and Latin America |
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Companies covered |
Manhattan Associates (US), Korber (Germany), Oracle (US), SAP (Germany), Tecsys (Canada), PSI Logistics (Germany), PTC (US), Reply (Italy), Infor (US), IBM (US), Blue Yonder (US), Generix Group (France), Microlistics (Australia), ABB (Switzerland), Microsoft (US), Epicor (US), Made4net (US), Mantis (US), Softeon (US), Synergy Logistics (US), E2open (US), Vinculum (India), Mecalux (Spain), SSI Schaefer (US), WareIQ (India), Foysonis (India), Increff (India), Locus Robotics (US), ShipHero (US), Cin7 (US), EasyEcom (India), Unicommerce (India), and IAM Robotics (US). |
This research report categorizes the smart warehousing market based on offering, technology, application, warehouse size, vertical, and region.
By Offering:
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Hardware
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Radio Frequency Identification Systems (RFID)
- Passive
- Active
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Sensor Networks
- Environmental Sensors
- Motion Sensors
- Proximity Sensors
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Real-Time Location Systems (RTLS)
- Indorr RTLS
- Outdoor RTLS
- Ultra-Wideband (UWB) RTLS
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Automated Guided Vehicles (AGVs)
- AGVs for Material Handling
- AGVs for Picking
- AGVs for Sorting
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Autonomous Mobile Robots (AMRS)
- AMRS for Inventory Scanning
- AMRS for Order Fulfillment
- AMRS for Material Handling
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Conveyor Systems
- Belt Conveyors
- Roller Conveyors
- Slat Conveyors
- Other Hardware
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Radio Frequency Identification Systems (RFID)
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Software
- Warehouse management System (WMS) Software
- Inventory Management Software
- Collaboration and Communication Tools
- Simulation and Modeling Software
- Labor Management Software
- Warehouse Control System (WCS)
- Other Software
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Software by Deployment Mode
- Cloud
- On-premises
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Services
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Professional Services
- Training & Consulting
- System Integration & Implementation
- Support & Maintenance
- Managed Services
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Professional Services
By Technology:
- IoT
- Robotics and Automation
- AI and Analytics
- Networking and Communication
- AR and VR
- Other Technologies
By Application:
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Inventory Management
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Real-Time Inventory Tracking
- Barcode Scanning
- RFID based Tracking
- GPS based Tracking
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Inventory Optimization
- Dynamic Reordering
- Safety Stock Management
- Demand Sensing
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Real-Time Inventory Tracking
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Order Fulfillment
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Picking-and-Packing Automation
- Robotic Pickers
- Goods-to-Person Systems
- Collaboration Robots (Cobots)
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Order Routing and Optimization
- Route Planning Algorithms
- Multi-channel Order Management
- Dynamic Slotting
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Picking-and-Packing Automation
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Asset Tracking
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Equipemnt and Vehicle Tracking
- GPS Tracking
- Telematics Systems
- Condition Monitoring
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Product and Package Tracking
- RFID Tagging
- Smart Packaging
- Blockchain-based Tracking
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Equipemnt and Vehicle Tracking
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Predictive Analytics
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Demand Forecasting Models
- Machine Learning based Forecasting
- Time Series Analysis
- Bayesian Forecasting
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Predictive Maintenance
- Sensor-based Predictive Maintenance
- AI-Driven Predictive Maintenance
- Failure-mode and Effects Analysis (FMEA)
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Demand Forecasting Models
- Other Applications
By Warehouse Size:
- Small
- Medium
- Large
By Vertical:
- Transportation and Logistics
- Manufacturing
- Healthcare & Life Sciences
- Retail & eCommerce
- Food and Beverages
- Energy & Utilities
- Agriculture
- Other Verticals
By Region:
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North America
- US
- Canada
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Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
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Asia Pacific
- China
- India
- Japan
- Australia and New Zealand (ANZ)
- South Korea
- ASEAN Countries
- Rest of Asia Pacific
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Middle East & Africa
- UAE
- Saudi Arabia
- South Africa
- Israel
- Rest of the Middle East & Africa
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Latin America
- Brazil
- Mexico
- Argentina
- Rest of Latin America
Recent Developments:
- In August 2023, Manhattan Associates announced PacSun, a leading specialty retailer of emerging youth brands and trending fashion, has selected Manhattan Active Point of Sale to enhance its omnichannel sales strategy and deliver a seamless, unified customer shopping experience.
- In August 2023, Infor announced that Zofri will implement Infor WMS warehouse management system to improve customer service, one of the most important performance indicators in the supply chain. The Infor WMS solution will be deployed in the cloud, which is powered by AWS (Amazon Web Services), and will be implemented by Cerca Technology, Infor's partner in Latin America.
- In May 2023, Manhattan Associates announced its re-imagined Manhattan Active Yard Management solution to expand the company’s vision of a unified supply chain. By redesigning yard management to work seamlessly with its industry leading warehouse and transportation management solutions on a single cloud native platform, Manhattan is completing the digital unification of distribution and logistics where they come together in the physical world.
- In March 2023, Raymour & Flanigan, the largest furniture and mattress retailer in the Northeast and seventh largest in the US, partners with Körber to respond more effectively to today’s consumer challenges through warehouse improvements pushing for greater order accuracy, speed, and customer fulfilment. This enables Raymour & Flanigan to build upon their long-standing legacy of bringing thoughtfully selected pieces of furniture to the places their customers serve, work and live while enhancing the customer shopping experience.
- In January 2023, Tecsys announced its warehouse-in-a-warehouse e-commerce fulfillment solution enabling retailers and brands to execute e-commerce fulfillment flawlessly while leaving existing wholesale and distribution models and legacy systems largely intact.
- In December 2022, Tecsys and SVT Robotics have partnered to develop and launch an out-of-the-box integrated connection between the Tecsys’ Elite supply chain platform and SVT's SOFTBOT Platform. The integration will provide Tecsys Elite customers faster deployment and lower complexity without the need for lengthy custom code development often involved in multi-system automation and robotics deployments.
- In March 2022, Marks & Spencer Reliance India Pvt Ltd (M&S India), a British retailer, and IBM are collaborating to modernize the supply chain, promote connectivity among online and in-store operations, and enhance customer experience. With IBM Sterling Supply Chain Solutions, M&S is expanding its multichannel potential in India.
Frequently Asked Questions (FAQ):
What is Smart Warehousing?
A smart warehouse is a tech-driven warehouse that stores raw materials and/or inventory and uses various tools to monitor inventory and optimize warehousing processes. Unlike traditional warehouses, smart warehouses leverage AI and technology to streamline internal processes.
What is the total CAGR expected to be recorded for the smart warehousing market during forecast period?
The market is expected to record a CAGR of 14.6% during the forecast period.
Which are the key drivers supporting the growth of the smart warehousing market?
Some factors driving the growth of the smart warehousing market are emergence of multi-channel distribution networks, dynamic nature and globalization of supply chain networks, and the rising focus on green initiatives and sustainability to minimize waste.
Which are the key technologies prevailing in the smart warehousing market?
The key technologies gaining a foothold in the smart warehousing market are IoT, robotics and automation, AI and analytics, networking and communication, AR and VR and others (cloud computing, blockchain).
Who are the key vendors in the smart warehousing market?
Some major players in the smart warehousing market include Manhattan Associates (US), Korber (Germany), Oracle (US), SAP (Germany), Tecsys (Canada), PSI Logistics (Germany), PTC (US), Reply (Italy), Infor (US), IBM (US), Blue Yonder (US), Generix Group (France), Microlistics (Australia), ABB (Switzerland), Microsoft (US), Epicor (US), Made4net (US), Mantis (US), Softeon (US), Synergy Logistics (US), E2open (US), Vinculum (India), Mecalux (Spain), SSI Schaefer (US), WareIQ (India), Foysonis (India), Increff (India), Locus Robotics (US), ShipHero (US), Cin7 (US), EasyEcom (India), Unicommerce (India), and IAM Robotics (US).
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The smart warehousing market research study involved extensive secondary sources, directories, journals, and paid databases. Primary sources were mainly industry experts from the core and related industries, preferred smart warehousing providers, third-party service providers, consulting service providers, end users, and other commercial enterprises. In-depth interviews were conducted with various primary respondents, including key industry participants and subject matter experts, to obtain and verify critical qualitative and quantitative information, and assess the market’s prospects.
Secondary Research
In the secondary research process, various sources were referred to, for identifying and collecting information for this study. Secondary sources included annual reports, press releases, and investor presentations of companies; white papers, journals, and certified publications; and articles from recognized authors, directories, and databases. The data was also collected from other secondary sources, such as journals, government websites, blogs, and vendors websites. Additionally, smart warehousing spending of various countries was extracted from the respective sources. Secondary research was mainly used to obtain key information related to the industry’s value chain and supply chain to identify key players based on hardware, software, services, market classification, and segmentation according to offerings of major players, industry trends related to hardware, software, services, deployment modes, technology, application, warehouse size, verticals, and regions, and key developments from both market- and technology-oriented perspectives.
Primary Research
In the primary research process, various primary sources from both supply and demand sides were interviewed to obtain qualitative and quantitative information on the market. The primary sources from the supply side included various industry experts, including Chief Experience Officers (CXOs); Vice Presidents (VPs); directors from business development, marketing, and smart warehousing expertise; related key executives from smart warehousing solution vendors, SIs, professional service providers, and industry associations; and key opinion leaders.
Primary interviews were conducted to gather insights, such as market statistics, revenue data collected from solutions and services, market breakups, market size estimations, market forecasts, and data triangulation. Primary research also helped understand various trends related to technologies, applications, deployments, and regions. Stakeholders from the demand side, such as Chief Information Officers (CIOs), Chief Technology Officers (CTOs), Chief Strategy Officers (CSOs), and end users using smart warehousing solutions, were interviewed to understand the buyer’s perspective on suppliers, products, service providers, and their current usage of smart warehousing solutions and services, which would impact the overall smart warehousing market.
The breakup of Primary Research:
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COMPANY NAME |
DESIGNATION |
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PSI Logistics |
Head of Marketing |
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Increff |
Co-Founder |
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ShipHero |
VP of Product - SaaS |
Market Size Estimation
In the bottom-up approach, the adoption rate of smart warehousing solutions and services among different end users in key countries with respect to their regions contributing the most to the market share was identified. For cross-validation, the adoption of smart warehousing solutions and services among industries, along with different use cases with respect to their regions, was identified and extrapolated. Weightage was given to use cases identified in different regions for the market size calculation.
Based on the market numbers, the regional split was determined by primary and secondary sources. The procedure included the analysis of the smart warehousing market’s regional penetration. Based on secondary research, the regional spending on Information and Communications Technology (ICT), socio-economic analysis of each country, strategic vendor analysis of major smart warehousing providers, and organic and inorganic business development activities of regional and global players were estimated. With the data triangulation procedure and data validation through primaries, the exact values of the overall smart warehousing market size and segments’ size were determined and confirmed using the study.
Global Smart Warehousing Market Size: Bottom-Up and Top-Down Approach:
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Data Triangulation
Based on the market numbers, the regional split was determined by primary and secondary sources. The procedure included the analysis of the smart warehousing market’s regional penetration. Based on secondary research, the regional spending on Information and Communications Technology (ICT), socio-economic analysis of each country, strategic vendor analysis of major smart warehousing providers, and organic and inorganic business development activities of regional and global players were estimated. With the data triangulation procedure and data validation through primaries, the exact values of the overall smart warehousing market size and segments’ size were determined and confirmed using the study.
Market Definition
Smart Warehouses, akin to smart factories, leverage data and automation to optimize their operations. These facilities automate a multitude of tasks, from order recognition and product receipt to storage, sorting, and dispatch. The integration of various automation technologies and interconnected equipment creates a technologically advanced environment where materials and shipments can be efficiently received, organized, identified, and prepared for delivery or dispatch with minimal human intervention.
Stakeholders
- Smart warehousing vendors
- Smart warehousing service vendors
- Managed service providers
- Support and maintenance service providers
- System Integrators (SIs)/migration service providers
- Value-Added Resellers (VARs) and distributors
- Distributors and Value-added Resellers (VARs)
- System Integrators (SIs)
- Independent Software Vendors (ISV)
- Third-party providers
- Technology providers
Report Objectives
- To define, describe, and predict the smart warehousing market by offering (hardware, software and services), technology, application, warehouse size, verticals, and region
- To provide detailed information related to major factors (drivers, restraints, opportunities, and industry-specific challenges) influencing the market growth
- To analyze the micro markets with respect to individual growth trends, prospects, and their contribution to the total market
- To analyze the opportunities in the market for stakeholders by identifying the high-growth segments of the smart warehousing market
- To analyze opportunities in the market and provide details of the competitive landscape for stakeholders and market leaders
- To forecast the market size of segments for five main regions: North America, Europe, Asia Pacific, Middle East & Africa, and Latin America
- To profile key players and comprehensively analyze their market rankings and core competencies.
- To analyze competitive developments, such as partnerships, new product launches, and mergers and acquisitions, in the smart warehousing market
- To analyze the impact of recession across all the regions across the smart warehousing market
Available Customizations
With the given market data, MarketsandMarkets offers customizations as per your company’s specific needs. The following customization options are available for the report:
Product Analysis
- Product quadrant, which gives a detailed comparison of the product portfolio of each company.
Geographic Analysis
- Further breakup of the North American smart warehousing market
- Further breakup of the European market
- Further breakup of the Asia Pacific market
- Further breakup of the Middle Eastern & African market
- Further breakup of the Latin America smart warehousing market
Company Information
- Detailed analysis and profiling of additional market players (up to five)
Generating Response ...
Growth opportunities and latent adjacency in Smart Warehousing Market