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Descartes targets vertical markets

The firm is planting its flag in a handful of vertical industries as it stakes out space in the shrinking supply chain management software market.

Descartes Systems Group is planting its flag in a handful of vertical industries as it and its competitors stake out space in the ever-shrinking supply chain management software market.

Analysts are predicting the supply chain management market is in for a shakeout as large enterprise resource planning vendors like SAP enter the market and the niche players like Descartes struggle to hold their ground.

Waterloo, Ontario-based Descartes announced today that it is forming four business units to support the core industries to which it caters its products. These specific markets are perishable consumer packaged goods like food and dairy products, nonperishable consumer packaged goods like beverages and household goods, high technology and field service firms including medical services and utility companies, and transportation and logistics firms like trucking and package delivery companies.

"This initiative was planned as an important milestone in our growth," said Peter Schwartz, Descartes chairman and chief executive. "We anticipated that we would need a growth strategy that would allow us to continue to focus on our core vertical markets as new market opportunities present themselves."

As part of the new organization, each of the industry units will have dedicated sales and implementation and service staff as well as industry specialists. Descartes plans to continue to support other markets through its general operations, executives said.

"All of the supply chain vendors are going to have to go this route to compete with the traditional ERP folks who are all coming their way from the other direction to get a piece of this action," said Dennis Byron, analyst at International Data Corporation in Framingham, Massachusetts.

Descartes has already lined up a pretty extensive list of customers for that day including Coca-Cola Bottling, Emery Worldwide, Ericsson, the New York Times, Brinks armored car services, and the Marriott.