Global Industrial Software Deep Dive with Cambashi industry experts
Cambashi highlights three major exogenous macro trends that influence growth of the global manufacturing and engineering software market: (1) Global GDP evolution given risks post-Russia-Ukraine geopolitical situation and ongoing global supply chain challenges; (2) Demand for energy efficiency and push for energy independence; and (3) increasing ESG drive pushing for higher supply chain transparency and detailed design and build documentation. We also note autonomous driving as another market driver, especially for simulation software.
Cambashi conclude the following in its recent key research:
- Engineering (Design) software is resilient against economic downturns.
- BIM (AEC) software is forecast to grow even more strongly.
- Software used in the 'Make' or 'Construct' stage is affected more by economic downturns. Still, it is expected to rebound, helped by rising spend on defence manufacturing, ESG push, and the future rebuild requirement in Ukraine.
Transition from Licensing to SaaS is a key trend in Industrial Software market and Cambashi highlight rising acceptance towards subscription service in industry software and among consumers overall globally. Perception of cloud services has also evolved – now seen as safer than on-premise hosting.
Cambashi highlighted that the value-added for an industry or end-market (essentially operating profit) is a reliable indicator of software adoption (in that industry / end-market) and hence software market growth, as proven empirically over the years. Cambashi forecast growth rates for particular players in the industry using a top-down method: forecast macroeconomic growth based on factors and data provided by Oxford Economics, then perform a sectoral projection of change by country, product, and industry, and finally estimate the change of individual companies.