Yesterday, Manhattan Associates Inc. (NASDAQ: MANH) reported annual revenue of $1.042 billion, up from $929 million last year. This represents year-over-year growth of 12.1%. Manhattan joins a select group of supply chain software suppliers – SAP, Blue Yonder, and Oracle – generating over $1 billion in annual revenue.
Manhattan Associates is a leader in two markets, warehouse management systems and omnichannel systems. The WMS solution optimizes productivity and throughput in distribution centers and warehouses. Supporting modules include labor and yard management.
Manhattan’s Omnichannel solutions provide an operating platform for digital commerce, retailers, and wholesale businesses. Comprising Order Management, Store Inventory Fulfillment, Call Center, Point of Sale (POS), and Customer Engagement as their core applications, Manhattan Omnichannel solutions provide CRM capabilities for contact center agents; end-to-end process enablement for store associates, and enterprise-wide inventory availability determination, order fulfillment optimization, and POS capabilities.
The company also sells supply chain planning and transportation management solutions.
Manhattan has been on a journey to get all their products on their microservices cloud-native Active Platform. In 2024, their supply chain planning solution was added to the platform. For customers with multiple supply chain products from Manhattan, much better orchestration of supply chain processes can occur.
This allows for enables bi-directional collaboration between supply chain planning and execution systems. Companies have a known problem synchronizing their supply chain plans with what can actually be executed. Manufacturers refer to it as the “shop floor to top floor disconnect.” This reflects the difficulty in synching the plans finalized in an integrated business planning executive meeting with what the shop floor is capable of manufacturing and fulfilling in the short-term time planning horizon.
The same disconnect can happen in the warehouse and in transportation. For example, if a promotion plan has not been correctly modeled for the warehouse, there may not be enough storage capacity, dock doors, or workers to execute the day’s work. However, a Manhattan Active SCP plan is built with an understanding of what the warehouse is capable of from the bottom up. In the case of a big promotion, the resulting plan would be “smoothed” by beginning the execution of the plan days earlier.
What Manhattan is doing on the transportation side is also significant. In a warehouse, workers pick cases and build pallets. Pallet building logic understands the dimensions and weights of the cartons. Based on this, the solution understands that you can’t build a six-layer set of cartons on a pallet with product A. Product A is too big. It must be five layers. Similarly, you must put product C on the bottom layers on a different pallet. If you put product B on the bottom, those cartons will be crushed.
Once the pallet plan is complete, you can build a better truckload. The logic behind how many pallets it takes to fill a truck is similar to pallet-building logic. The trailer build is based on the dimensionality and weight of the pallets with a full understanding of issues like crushability and whether the pallets will weigh out or cube out a trailer. Cubing out is preferable; companies don’t like to ship air. A transportation plan built with a full granular understanding of trailer building constraints can also be smoothed.
In short, the bidirectional messaging between Manhattan’s SCE and SCP solutions helps create far more feasible and executable plans.
Manhattan’s growth has likely been driven by both the functionally rich WMS and omnichannel solutions and the advantages their platform brings to their customers.
In something of a surprise, the company is only forecasting 2-3% growth in the coming year. Eddie Capel, the CEO of Manhattan Associates explained this by saying, “We do remain cautious on the global economy, though, which has become more acute for our services business. Near term headwinds for our services surfaced as about 10% of our customers with in flight implementations reduced their planned services work for the upcoming year.” Services are important for Manhattan. They represent over 50% of the company’s revenues.
