Burlington, MA – (February 7, 2007) – Emptoris, the leading provider of Enterprise Supply and Contract Management solutions, announced today that it has recorded 83% year-over-year sales growth for 2006.
Emptoris reported four consecutive quarters of sequential growth, and grew more than five times faster than the 10% growth in the overall supply and contract management software market. The company said its growth has clearly been fueled by its ability to provision its software platform both as a Service (SaaS), as well as on-premise. The company said significant new customer wins and competitive displacements over the course of the year continue to demonstrate the strength of its broad supply management suite, and its leadership in Enterprise Contract Management.
“Companies clearly have a need for a very capable integrated sourcing suite and sophisticated enterprise contract management.” said Avner Schneur, chief executive officer of Emptoris. “Our growth was fueled by having industry leading solutions, delivered as either a service or installed on customers’ premises. Not only are we flexible up-front, our software allows a customer to transition from one model to the other.”
In 2006, Emptoris grew over five times faster than the supply and contract management software market, which has been estimated to be growing at 10% annually, and is expected to reach $3 billion by 2008, according to Forrester Research. Emptoris recorded its strongest yearly performance ever with 240 transactions contributing to 83% year-over-year sales growth. Growth accelerated in the fourth quarter as Emptoris recorded 185% sales growth over the fourth quarter of 2005.
Over 70% of sales came from companies that were not Emptoris customers at the beginning of 2006. The growth was consistent throughout the year, with each quarter’s growth larger than the previous. Due to strong demand for the company’s software as a service (SaaS) offerings, the company’s sales backlog and deferred revenue, which represents future committed revenues in multi-year subscription contracts, is as large as the company’s total 2006 revenues.
Throughout 2006, Emptoris continued to win significant new business and capture large marquee customers from Ariba. Examples in the fourth quarter included an internationally recognized beauty products company, a global chemical company and an international leader in networking equipment, which, even as one of Ariba’s earliest customers, has elected to use the Emptoris Contract Management solution.
Examples of other new enterprise customers who signed with Emptoris include one of the world’s largest oil and gas producers, three leading regional health insurance providers, and one of the top U.S. refiners and distributors of gasoline.
International deals continued to represent significant growth for Emptoris, as did deals signed by channel partners. In 2006, 34% of Emptoris’ sales bookings came from Europe and the Asia Pacific region. During the same period, channel partners delivered almost 20% of the company’s sales.
Hybrid Deployment Strategy Accelerates Growth
Emptoris capitalized on the high demand for supply and contract management software, regardless of how customers chose to deploy the software. Based on deals signed in the second-half of 2006, 65% of customers selected to deploy the solutions in a Software-as-a-Service (SaaS) mode, making multi-year contract commitments. Approximately 45% of these SaaS deals were over $1 million. Emptoris can deploy all its solutions either on-premise or as Software as a Service, and offers the ability for customers to switch between the two.
“This is a major competitive advantage against ERP vendors which lack solution capabilities, and offer a patch quilt of conflicting on-demand and installed software” said Ammiel Kamon, Senior Vice President of Marketing and Product Management at Emptoris.
Contract Management Leadership
In 2006, Emptoris also cemented its position as a contract management leader, and the Emptoris Contract Management Solution was the number one ranked current product offering by Forrester Research in the March 2006 report entitled “The Forrester Wave™:Contract Lifecycle Management, Q1 2006.” Over 67% of new software sales during the last two quarters of 2006 included the Emptoris Contract Management solution.
The Emptoris Contract Management Solution enables companies to gain greater contract visibility, reduce associated risks and create more profitable contracts. This comprehensive solution supports all contract types including sales contracts, procurement contracts, and industry specific contracts. In the second half of 2006 Emptoris won an increasing number of customers wishing to control sales or industry specific contract processes.
Integrated Suite Leadership
Emptoris’ strong growth was also due to satisfying customers’ needs for a broad, integrated supply and contract management suite. Based on 2006 second-half deals, 40% of customers selected to deploy multiple Emptoris solutions, including spend analysis, sourcing, contract management and supplier performance management.
Throughout 2006, Emptoris released a number of new solutions and expansions of existing offerings:
Emptoris 6: Emptoris 6 provides the deepest and broadest functionality to support the supply and contract management process including solutions for spend analysis, sourcing, contract management, compliance, and supplier performance management. The solution suite can analyze all types of spend, manage sourcing for all categories and negotiate all types of contracts.
SAP Solution Integration: Emptoris released its SAP integration package for Emptoris 6. With this turnkey solution based on the SAP NetWeaver® Exchange Infrastructure (SAP NetWeaver XI), companies can drive sourcing and contract decisions directly into the ERP procure-to-pay process, ensuring day-to-day operations meet the requirements of strategic agreements.
Emptoris Spend Analysis: Emptoris also released an expansion of its market-leading Spend Analysis solution designed to augment a company’s ERP strategies, and take those IT driven efforts to the next level in accuracy and spend visibility.
Overdrive by Emptoris: Emptoris also launched Overdrive in 2006, a new offering designed to help companies establish and equip their e-sourcing Program Management office - thus accelerating business impact, driving self-sufficiency, and pushing adoption to the next level.
Event Monitoring and Support: Launched a new offering to ensure successful execution of sourcing events for global customers by providing event-based operational support, including event set up review, supplier on-boarding and training, auction monitoring services, and real-time buyer and supplier bidding support. The service is available in supplier’s local language, with particular emphasis on support for Asia-Pacific languages and low-tech suppliers.
Global and Corporate Expansion
Emptoris has aggressively expanded its operations throughout 2006, and has been on the forefront of the consolidation in the Supply Management space.
Key milestones include:
By the end of 2006 Emptoris had over 400 employees.
Continued investment of over a third of revenue back into research and development
Expanded presence in France and Germany, and a doubling of the European organization.
Acquisition of diCarta: In the first quarter Emptoris completed its merger with diCarta, the leading provider of enterprise contract management software. The combination enabled the company to offer a more comprehensive enterprise-wide supply and contract management solution to customers. Both companies were hailed by independent research firms for being number one for their current offerings and experienced strong customer and revenue growth.
Acquisition of MINDFLOW: In July 2006, Emptoris also announced the acquisition of MINDFLOW Technologies, a recognized innovator in inbound supply chain planning and sourcing optimization.
Independent Recognition
In 2006, Emptoris also continued to receive independent recognition for the innovation and impact of its solutions – as well as for its market leadership:
Forrester Research: The Emptoris Contract Management solution was ranked
#1 for current offering in the Forrester Wave Contract Lifecycle Management Suite (Q1 2006) – and the Emptoris Sourcing solution was also ranked
#1 for current offering in the Forrester Wave Esourcing Suite.
Induction by INFORMS into Franz Edelman Academy: Emptoris became the only software vendor inducted by INFORMS into the prestigious Franz Edelman Academy. The recognition is for using supply optimization to significantly impact and transform a business, specifically enabling Motorola to save $600 million.
Supply & Demand Chain Executive: Emptoris was also selected for The Supply & Demand Chain Executive listing of the leading supply management innovators in the market.
CPO Agenda Executive Debates and Sourcing Thought Leadership
Emptoris has joined forces with Accenture and CPO Agenda Magazine to produce a series of executive roundtable debates. For more information on these events, please visit
www.emptoris.com. Emptoris and Accenture have also co-authored an executive whitepaper detailing the role of supply management technology as a critical component supporting low cost country sourcing initiatives.
As part of its on-going thought leadership series, Emptoris partnered with the Institute of Supply Management and Cargill to deliver an online seminar on strategic sourcing. The event, one of ISM’s most popular, is titled “Practical Approaches to Sourcing for Best Value, Not Just Best Price.” To watch a recorded version of this, go to:
www.emptoris.com/sourcing.About Emptoris
Emptoris is the world leader in innovative supply and contract management software solutions that empower enterprises to realize best value and accelerate profitable growth. Emptoris solutions are used by successful Global 2000 companies in every industry. Customers include American Express, Boeing, Dow Corning, GlaxoSmithKline, Motorola, Owens Corning, Samsung America, and Toro.
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