SMB Software Market Research Report By Deployment Type (Cloud-Based, On-Premises), By Company Size (Micro, Small, Medium), By Industry Vertical (Healthcare, Retail, Manufacturing, Financial Services), By Functionality (Customer Relationship Management (CRM), Enterprise Resource Planning (ERP), Human Capital Management (HCM), Business Intelligence (BI)) and By Regional (North America, Europe, South America, Asia-Pacific, Middle East and Africa) - Forecast to 2032

SMB Software Market Overview

As per MRFR analysis, the SMB Software Market Size was estimated at 133.28 (USD Billion) in 2022.

The SMB Software Market Industry is expected to grow from 145.05(USD Billion) in 2023 to 310.5 (USD Billion) by 2032. The SMB Software Market CAGR (growth rate) is expected to be around 8.83% during the forecast period (2024 - 2032).

Key SMB Software Market Trends Highlighted

The SMB Software Market is expected to reach a considerable value before 2023 due to the increased pace and rate of digitalization and the shift to the consumption of cloud applications. The need to operate more effectively, increase customer relations and improve creativity are some of the major market contributors for small and medium business entities.

There is a demand for, and potential for, development in the areas of the increased demand for targeted large-scale small and medium business software application services to specific markets and business functions. There have been visible changes towards more mobile oriented tools, increased adoption of SaaS and PaaS, and incorporation of electronics as well as AI in common usage software. They are redefining the market space and offering novel prospects to software distributors.

SaaS has become a perfect cloud solution as it gives SMBs access to advanced and complex applications without making much investment at the initial stages of acquiring application software. This has consequently promoted the adoption of SaaS and PaaS, which have made it easy for SMBs in terms of cost and scale.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

SMB Software Market Drivers

Rising Adoption of Cloud-Based Solutions

One of the main drivers for the SMB Software Market Industry is the increasing adoption of cloud-based solutions among small and medium-sized businesses. Cloud-based software offers many benefits to SMBs in terms of increased flexibility, scalability, and cost-effectiveness. With cloud-based software, SMBs can access their programs from any location with an internet connection, which helps them manage their work and allows for easier collaboration between colleagues who may be located elsewhere.In addition, cloud-based software is often cheaper for SMBs to use since they do not need to purchase hardware or pay for IT infrastructure. Going forward, the increasing use of cloud-based solutions will continue to drive the growth of the SMB Software Market Industry.

Increasing Need for Data Security and Compliance

Another key driver of the SMB Software Market Industry is the increasing need for data security and compliance. SMBs are increasingly facing cyber threats and data breaches, meaning that they must invest in powerful security solutions. Smb Software can help them keep their data from unauthorized access, theft, and loss. In addition, industry regulations and standards set by governmental agencies and non-profit organizations require legal compliance from all businesses.Smb Software can assist a company in remaining compliant and protecting its customers' data. The raised demand for data security will likely ensure that the need for Smb Software continues to grow.

Growing Adoption of Mobile Devices in the Workplace

The SMB Software Market Industry is growing due to the growing adoption of mobile devices in the workplace. SMBs are using mobile devices to access business applications and data to an increasing extent. The major drivers of this trend are the availability of cheap mobile devices and the use of bring-your-own-device policies. Thus, Smb Software is used by SMBs to manage and secure their mobile devices. Moreover, the Smb Software allows employees to access business applications and data wherever they are.Since the adoption of mobile devices in the workplace will continue to grow, the use of Smb Software will also increase in the coming years.

SMB Software Market Segment Insights

SMB Software Market Deployment Type Insights  

The SMB Software Market is segmented based on deployment type into cloud-based and on-premises. The cloud-based segment is expected to grow at a faster rate during the forecast period due to its scalability, flexibility, and cost-effectiveness. The on-premises segment, on the other hand, is expected to witness a steady growth rate due to its security and control advantages. In 2023, the cloud-based segment accounted for 60% of the SMB Software Market revenue, and it is expected to grow at a CAGR of 10.2% during the forecast period.The growth of this segment is attributed to the increasing adoption of cloud computing by small and medium-sized businesses (SMBs). 

SMBs are increasingly realizing the benefits of cloud-based software, such as reduced IT costs, improved collaboration, and increased agility. The on-premises segment accounted for 40% of the SMB Software Market revenue in 2023, and it is expected to register a CAGR of 6.5% during the forecast period. The growth of this segment is attributed to the security and control advantages offered by on-premises software.The growth of the market is attributed to the increasing adoption of cloud computing, the growing need for SMBs to improve their operational efficiency, and the increasing demand for industry-specific software solutions.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

SMB Software Market Company Size Insights  

The SMB Software Market segmentation by Company Size into Micro, Small, and Medium offers valuable insights into the market dynamics. In 2023, the Small segment held the largest revenue share of 35.2%, owing to its wide adoption by small businesses seeking cost-effective solutions to streamline operations. The Micro segment is expected to grow at a significant CAGR of 9.5% during the forecast period, driven by the increasing number of micro-businesses and startups. Medium-sized businesses are also expected to contribute to market growth, with their demand for comprehensive software solutions that can support their expanding operations.Overall, the SMB Software Market is expected to reach $169.3 billion in 2024, driven by the growing adoption of cloud-based solutions and the increasing need for efficiency and productivity in SMBs.

SMB Software Market Industry Vertical Insights  

The SMB Software Market segmentation by Industry Vertical into Healthcare, Retail, Manufacturing, and Financial Services provides valuable insights into the diverse application areas of SMB software solutions. The Healthcare segment is anticipated to witness significant growth, driven by the rising demand for digital health records, patient management systems, and telemedicine solutions. The Retail segment is expected to expand due to the increasing adoption of e-commerce platforms, inventory management systems, and customer relationship management (CRM) tools.The Manufacturing segment is projected to grow steadily as SMBs seek to optimize production processes, improve supply chain management, and enhance product quality. The Financial Services segment is expected to contribute significantly to the overall SMB Software Market revenue, driven by the need for compliance management, risk assessment, and data analytics solutions. These industry-specific insights enable SMB software vendors to tailor their offerings and address the unique challenges and opportunities within each vertical.

SMB Software Market Functionality Insights    

The Functionality segment of the SMB Software Market market is expected to exhibit significant growth in the coming years, driven by the increasing adoption of cloud-based solutions and the need for businesses to improve their operational efficiency. According to market research, the Customer Relationship Management (CRM) software segment held the largest market share in 2023 and is projected to continue its dominance throughout the forecast period. The growing need for businesses to manage customer interactions effectively and improve customer satisfaction is fueling the demand for CRM solutions.The Enterprise Resource Planning (ERP) software segment is also expected to witness substantial growth as businesses seek to integrate their various business processes and improve their overall productivity. The increasing adoption of cloud-based ERP solutions is further driving the growth of this segment. The Human Capital Management (HCM) software segment is gaining traction due to the rising demand for solutions that can help businesses manage their workforce effectively. HCM solutions provide features such as employee onboarding, performance management, and payroll processing, which are essential for businesses of all sizes.Finally, the Business Intelligence (BI) software segment is expected to grow rapidly as businesses recognize the importance of data-driven decision-making. BI solutions provide businesses with the ability to analyze their data and extract valuable insights, which can help them improve their operations and stay ahead of the competition.

SMB Software Market Regional Insights    

The SMB Software Market is segmented into North America, Europe, APAC, South America, and MEA. Among these regions, North America held the largest market share in 2023, owing to the presence of a large number of SMBs and the early adoption of new technologies. Europe is expected to be the second-largest market, followed by APAC. The APAC region is expected to witness the fastest growth rate during the forecast period due to the increasing number of SMBs and the growing adoption of cloud-based solutions. South America and MEA are expected to have a smaller market share, but they are expected to witness steady growth during the forecast period.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

SMB Software Market Key Players And Competitive Insights

Major players in the SMB Software Market industry are constantly developing new and innovative products to meet the evolving needs of their customers. These leading SMB Software Market players are also investing heavily in research and development to stay ahead of the competition. The SMB Software Market development is being driven by the increasing adoption of cloud-based solutions and the growing need for businesses to improve their efficiency and productivity. The competitive landscape of the SMB Software Market is expected to remain fragmented over the next few years, with a number of players vying for market share. However, the leading players are likely to continue to dominate the market due to their strong brand recognition and customer loyalty.

A leading company in the SMB Software Market is Salesforce. Salesforce offers a wide range of cloud-based solutions for businesses of all sizes, including sales, marketing, customer service, and analytics. Salesforce has a strong track record of innovation and has been recognized as a leader in the SMB Software Market by Gartner and Forrester. The company has a large customer base of over 150,000 businesses, and its annual revenue is over $20 billion.A competitor company in the SMB Software Market is Microsoft. Microsoft offers a range of cloud-based solutions for businesses of all sizes, including Office 365, Dynamics 365, and Azure. Microsoft has a strong track record of innovation and has been recognized as a leader in the SMB Software Market by Gartner and Forrester. The company has a large customer base of over 1 billion businesses, and its annual revenue is over $100 billion.

Key Companies in the SMB Software Market Include

• Acumatica


• Workday


• IFS


• QAD


• NetSuite


• SAP


• Microsoft


• Oracle


• Sage


• Syspro


• Infor


• Salesforce


• Epicor


• Intuit

SMB Software Market Industry Developments

The SMB Software Market is projected to reach $310.5 billion by 2032, exhibiting a CAGR of 8.83% from 2024 to 2032. The increasing adoption of cloud-based solutions, the growing need for data security and compliance, and the rising demand for mobile-friendly applications are driving the market growth. Key industry developments include the acquisition of Slack by Salesforce in 2021, highlighting the growing convergence of communication and collaboration tools within SMB software suites. Additionally, the emergence of artificial intelligence (AI)-powered solutions is expected to revolutionize the market by automating tasks and providing data-driven insights.

SMB Software Market Segmentation Insights

• SMB Software Market Deployment Type Outlook
  
  
  
  • Cloud-Based
  
  
  • On-Premises
  
  
  
  

• SMB Software Market Company Size Outlook
  
  
  
  • Micro
  
  
  • Small
  
  
  • Medium
  
  
  
  

• SMB Software Market Industry Vertical Outlook
  
  
  
  • Healthcare
  
  
  • Retail
  
  
  • Manufacturing
  
  
  • Financial Services
  
  
  
  

• SMB Software Market Functionality Outlook
  
  
  
  • Customer Relationship Management (CRM)
  
  
  • Enterprise Resource Planning (ERP)
  
  
  • Human Capital Management (HCM)
  
  
  • Business Intelligence (BI)
  
  
  
  

• 
  

  SMB Software Market Regional Outlook

  
  
  
  
  • North America
  
  
  • Europe
  
  
  • South America
  
  
  • Asia-Pacific
  
  
  • Middle East and Africa