Earlier today, RedPrairie announced that it had completed the acquisition of WMS provider SmartTurn, which in our view is yet another indication of the increasing attractiveness of on-demand and hosted supply chain technology. Financial terms were not initially disclosed.
Supply Chain Matters initially discovered SmartTurn in October of 2008. Our commentary, A Different Alternative for Warehouse and Inventory Management, we noted how this multi-tenant software-as-a-service provider could become a disrupter in the market by offering attractive cost affordability with fairly decent functionality. This company openly stated that it charged $500 per month per warehouse for an unlimited amount of users, which is somewhat attractive when one considers other WMS alternative applications in the market. Implementation times were also attractive, with the company boasting of some client implementations that ranged from two to three weeks.
Since that time, SmartTurn has garnered additional small and mid-market manufacturers, distributors and third-party logistics firms. In November of 2009, the company announced that it had integrated its application with the inventory management system of SaaS ERP provider NetSuite. My sense that this was an initial move toward a potential acquisition by some SaaS based ERP or enterprise systems provider but it is now evident that RedPrairie was quicker to execute. Initial indications are that RedPrairie will maintain SmartTurn as an autonomous business unit with a mid-market focus.
As we have noted in various other commentary, SaaS applications in supply chain have definitely shown increased interest by customers for the reasons noted in our SmartTurn commentary. One of the latest entrants in the SaaS based WMS field is SnapFufil,which just made its U.S. market entry after a successful track record in Europe.
SaaS warehouse management systems are becoming more common. This includes Tier 1 solutions. One trick here when buying however is to understand the detailed level functionality provided and whether it is a good fit for the warehouse operation. Detailed functionality varies considerably between solutions.