According to our latest market study on "Construction Accounting Software Market Forecast to 2028 - COVID-19 Impact and Global Analysis - by Offering, Deployment, and Application," the market is expected to grow from US$ 943.91 million in 2022 to US$ 1,217.42 million by 2028; it is expected to grow at a CAGR of 6.3% from 2022 to 2028.
Accounting software is very vital for operating all construction companies successfully. Companies of all sizes continuously deal with numerous subcontractors, contractors, and temporary construction teams, which further complicates procurement, payroll, and other accounting functions. Hence, reliable software is required to guarantee everything, from purchase orders to inventory, and ensure that equipment is tracked, utilized, and replenished accordingly. Construction accounting software offers users several financial management tools such as payroll, general ledger, job costing, audit reporting, and accounts payable and receivable (AP/AR) for small and large construction activities. Certain construction accounting software solutions are developed and focused on specific financial information, while others offer accounting insights into the organization. Through deploying construction accounting software, builders and contractors can enhance project performance by offering all the relevant information to the project managers and minimizing the risk of manual financial calculation error that harms the company.
Construction is one of the important industries growing at an exponential rate globally. Government bodies of countries such as the US, China, and India are investing heavily in developing commercial infrastructures, including airports, hotels, hospitals, universities, and office buildings. With a growing number of infrastructural projects, construction companies emphasize on advanced technologies by using construction accounting software. The booming construction industry and the rising penetration of ERP modules in the construction industry are among the key driving factors for the global construction accounting software market. However, the availability of free construction accounting software for some applications may hinder the construction accounting software market growth. Despite some limitations, the largely untapped market amongst small construction firms is anticipated to drive the construction accounting software market.
North America is one of the most important regions for adopting and growing new technologies owing to favorable government policies to boost innovation and strengthen infrastructure capabilities, especially in developed countries such as the US and Canada. Hence, any impact on the growth of industries is expected to affect the economic growth of the region negatively. The US is one of the world's worst-affected countries due to the COVID-19 outbreak. The US is a prominent market for accounting software, especially in the construction sector. Lockdowns and travel restrictions imposed in the region affected the construction industry significantly. Large and small construction projects were shut down across the country. US, Canadian, and Mexican authorities ordered the termination and shutdown of most construction projects in 2020, due to which the construction companies reduced their spending on ad-hoc technologies such as accounting software, which impacted the growth of the construction accounting software market in North America. However, since 2021, the industry has been improving at a faster pace with a significant rise in construction projects and an increase in investments in mega infrastructure development. For instance, according to the US Census Bureau and the US Department of Housing and Urban Development new residential construction statistics, privately?owned housing completions were at an annual rate of 1,309,000 in February 2022, an increase of 5.9% from the January estimate of 1,236,000. Furthermore, single?family housing completions in February 2022 were at a rate of 1,034,000, 12.1% higher than that of January at 922,000. Thus, such growth prospects in private home constructions in the pandemic recovery scenario are attributed to the rise in demand for construction accounting software in the country, which is further propelling the construction accounting software growth in North America.
Key Findings of Study:
The construction accounting software market is segmented based on offering, deployment, application, and geography. Based on offering, the construction accounting software market is segmented into solution and services. Based on deployment, the construction accounting software market is bifurcated into on premise and cloud. Based on application, the construction accounting software market is segmented into small and mid-sized construction companies and large construction companies. Based on geography, the construction accounting software market is broadly segmented into North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South America (SAM). In 2021, North America accounted for a significant share of the construction accounting software market.
The US, Canada, and Mexico are the major economies contributing to the North America construction accounting software market. Continuous technological advancements led by tech giants, along with notable investments in R&D activities, have created a stir in the region's competitive market. As the region is known for adopting advanced technologies in their early stage, the scope for construction accounting software would also increase. Economic development and considerable infrastructure development are resulting in regional revenue generation for the construction industry. Further, the presence of construction associations such as the Construction Management Association of America (CMAA) and Associated General Contractors of America is contributing to the growing construction industry.
Construction is one of the crucial industries growing exponentially in the region. The US, Canada, and Mexico's government bodies are investing substantial amounts in developing commercial infrastructures, including airports, hospitals, hotels, office buildings, and universities. With a growing number of infrastructural projects, modern-day builders emphasize on advanced technologies by using construction accounting software. This software enables contractors and end users to manage their operations with minimal effort and enhance productivity by analyzing performance constantly. The implementation of construction accounting software is rapidly increasing owing to the huge growth in the infrastructure activities and benefits offered by the software in terms of project management, construction payroll, mobile construction software, and construction business intelligence to ensure greater productivity of construction projects, contributing to the construction accounting software market growth.
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