WMS – explained

If you run your warehouse with excel spreadsheets or even worse, on paper, and you have a nightmarish inventory process, or something is always missing from the inventory, we think it’s time for you to familiarize yourself with WMS.

Warehouse Management System or WMS is a software solution for warehouse automation and tracking of all warehouse processes. Quality WMS aims at 97% inventory accuracy and handles all of the warehouse processes – from receiving (goods in), put-away, picking, packing, and shipping of the goods. That way, all processes in your warehouse are monitored, automated and optimized by a software solution that gets you many benefits, more of which below.

What are the essential features of WMS?

Imagine a tidy warehouse without any paperwork where items are categorized and stored in an orderly fashion. All items are automatically stored on warehouse shelves, in proper order and all are entered by scanning via a barcode terminal. There is no hassle, lost items, and the whole company has an overview of the inventory status in real-time. This is not an illusion. Your warehouse really can look like this.

The warehouse management system tracks the movement of items through the warehouse. The software solution has some ERP software elements, but usually, WMS is integrated and connected with 3rd party ERP solutions used by companies that are implementing WMS. That way sales, marketing, management, and other departments in the company know the exact inventory status in real-time, making their job easier and enabling them to plan more accurately.  

Main features of quality WMS:

– Automation of all warehouse processes such as: receiving (goods in), put away, picking, packing and shipping of goods, inventory checks, etc.,

– Documentation workflow with automated import to company business software (ERP),

– More efficient workforce management. Optimization of workflow with the more precise flow of the goods and elimination of mistakes,

– Receiving, tagging, and picking of items over barcode terminals and storing real-time information in the information database.

Types of WMS solutions

WMS usually is a standalone software solution. In most cases, it is connected with other business intelligence solutions like ERP systems. For example, if you are using SAP ERP you can integrate it with your newly picked WMS system, in order to have a smooth data exchange between these two.

Another subcategory of WMS is a solution that comes as a module of the existing ERP system. The main disadvantage of that type of WMS add-on is that it doesn’t have complex features that are available in a standalone Warehouse Management System and is less customizable, therefore it may not be able to cover all your processes and needs.

While some smaller organizations still work with spreadsheets, from SMBs to corporations, WMS is an essential part of the modern warehouse. WMS is a scalable and modular solution that can be tailor-made for a company, and in general, businesses choose WMS as a standalone software solution.

Standalone WMS can adapt to the company size, warehouse complexity and specific warehouse processes, which can help you grow your business and scale more easily.

Main benefits of WMS

Warehouse workflow and process automatization bring numerous benefits you might miss at first sight. To give you a better overview of how WMS can help your company, we made a list of such solutions’ top advantages.

a) Cost reduction and space optimization

WMS is an intelligent system that tracks all processes inside of a warehouse and can provide the best solution for maximum warehouse space optimization. With movement analysis and knowing where you store your items, materials, or goods, you can make the best business decisions on where you should place goods for maximum movement efficiency. That way, you’re saving valuable storage space and workers’ time.

Other optimization areas

– Better warehouse space utilization,

– Timely and correct item delivery that results in fewer shortages or excesses of goods,

– Less time spent on employee training and onboarding,

– Faster picking and packing, and no more searching for lost items.

All this leads to a reduction of operating costs and better flow of goods through the warehouse.

WMS can also perfect item movement with standard protocols like first-in-first-out (FIFO), last-in-first-out (LIFO), first expires-first-out (FEFO).

No matter how complicated your processes are, WMS will help you with automation and therefore reduce your costs in the long run.

b) Real-time inventory visibility

WMS enables better accuracy and visibility of your inventory, and all of that in real-time. By running different kinds of reports you know the exact amount of each and every item you have in your warehouse. Such precision and transparency are achieved with barcode scanning of every item and every location in the warehouse. This way you are decreasing the number of lost items and improving your inventory accuracy. And when you integrate such precise metrics with your ERP, it will boost efficiency and decision-making inside of the whole company, not only in your department.

c) Labor efficiency

WMS also automates assigning of tasks to the right person in the warehouse. Alongside that, optimization of travel time within the warehouse is one of the greatest benefits that the WMS can provide to improve labor utilization. By defining the best picking method, you are shortening the path from point A to point B, which makes your staff more efficient. You can even do the analysis of your goods and rearrange your warehouse layout so that high-moving goods are closer and faster to pick and pack.

Elimination of paperwork and introduction of barcode terminals enables employees to work efficiently and to focus only on their core tasks, and at the same time decreasing errors in picking and packing.

d) Serialization and tracking of items

Items in the warehouse can be easily tracked with their serial number and their batch, e.g. their LOT number. That way, if you are manufacturing from raw materials, you can track the whole process, from raw materials to the finished product and serial or LOT number will tell you of which items finished product is made.

WMS can help with tracking and connecting items with incoming orders, and you will have a better overview of the flow. It also contributes to planning and resource allocation. You can cut costs with detailed inventory insight in real-time, which results in avoiding unnecessary orders or lost items.

e) Improving supply chain

Warehouse Management System influences the whole supply chain with its automation features. Incoming goods, papers, and all processes in the warehouse up until delivery are simplified and automated. Accurate and quick shipping with the elimination of unwanted steps will increase efficiency and cut costs. By implementing WMS, you can also improve partner relations by improving supply chain efficiency and enabling better service for your clients.

f) Cutting operational costs for warehouse equipment

The warehouse that uses WMS is highly automated, which reduces workforce and equipment load. You can cut costs on the amortization of equipment, smaller electric and gas bills, and materials like paper.

WMS’s other advantages include better user experience through the faster workflow from ordering to delivery and further adjustments in warehouse workflow through constant learning from reports.

Who is using WMS?

If you wondered which industries use WMS, the answer is not focused on industry type as much as on the warehouse’s size and complexity.

Distribution companies, 3PLs, retailers, manufacturers, and other trade companies use WMS. Warehouse Management System is extremely useful in the food industry, electronics, textile, tobacco, and any other industry which handles bigger inventories.

The need for WMS comes when you are not handling your inventory properly, and you are way too big to use papers or Excel sheets.

WMS scalability allows even smaller companies to acquire quality solutions and ease their practices, and prepare them in advance for the growth of their business, therefore improving scalability.

Conclusion

Warehouse Management System comes with numerous benefits. A quality solution will help with the automation of standard procedures in the warehouse. This means you will get real-time reports on workflow and warehouse inventory.

Better equipment and workforce utilization and better space management are among the essential benefits.

WMS is a business software with detailed statistics, automated data export for all departments, including accounting and sales.

In case you’d like to find out more, contact us and we’ll provide you with our consultancy.

Why invest in WMS? Top 5 reasons revealed!

What is a modern Warehouse Management System? If we consider the warehouse as the essential part of company logistics, WMS is its software necessity.

Historically, warehouses were managed via pen and paper. After that, the first computer upgrade included Excel spreadsheets, and digital transformation brought software solutions that manage processes and workflows in the warehouse, such as picking, order fulfillment, and delivery.

Increasing efficiency and cost-effectiveness are the main ideas behind Warehouse Management Systems. WMS has in-depth data analysis, reporting, voice control systems, connecting with other business intelligence systems, and some additional hardware components like RFID or barcode readers to achieve these improvements.

There are numerous benefits of the WMS solution, and we have five crucial reasons you should invest in a Warehouse Management System.

1. Real-time inventory control and management

If you need to check the inventory status manually when someone asks about it, maybe it is time to invest in a WMS.
Professional modern WMS improves inventory control – you will have less stock, improved order fulfillment, and reduced order cycle time.

You can achieve these benefits by tracking every unit in the warehouse to the tiniest details. Tracking inventory with barcode scanners, you will know the type, series, and correct item name for every item in your stock. All information is uploaded in real-time into the system, leading to much faster and more efficient inventory management. At every moment you are able to check which items are low in stock, and which ones are overstocked, so you can make better business decisions.

The entire company has an overview of the current warehouse stock inventory because WMS is connected with other business intelligence software like ERP.

2. Better employee efficiency

Staff salary is among the most significant costs in the warehouse. With all automation, your employees are still a crucial piece of warehouse operations, and with WMS, you can optimize and utilize their efforts.

WMS will enable better efficiency, quality control system and speed up the product warehouse lifecycle. The first step in increased efficiency is the reduction of paperwork and manual lists. For even the smallest warehouses, relying on pen and paper processes can slow down the picking process. When you put away inventory without a verification scan, you’re more likely to make an error in data recording – which then must be corrected during the picking process. As said before, automation will eventually lead to fewer human-made errors. Also, you must ensure your staff is working in the smartest possible way to fulfill every order.

Movement and individual employee’ efficiency analysis leads to better movement patterns. WMS will enable upfront ideal picking routes through the warehouse so each staff member can cover more ground more effectively. Also, after doing a proper analysis of the movement of your goods, you will be able to better set up your warehouse layout, meaning all goods that are spending a minimal amount of time in the warehouse, i.e. are fast-moving, should be stored closer to the exit zone. That way, your staff will spend less time walking and have more time to focus on their crucial tasks.

3. Better user experience for your clients

Too many complaints to the customer service can damage your or your clients’ company reputation. Even worse, it can cut your or their revenue. When sales don’t have accurate info about inventory, the company can experience a delivery backlog, or even worse, you can run out of stock. If you have a faulty system for order fulfillment, you can send items to the wrong address or send the incorrect quantities.

Quality Warehouse Management System will alleviate most human errors and enable inventory control best practices. Software solutions using scanners will lead to detailed real-time data and improvements in warehouse accuracy almost up to 100%. Every person in your company will be able to know the exact amount of inventory, which helps you with your orders.

Reliable inventory management will result in a better user experience, fewer customer service complaints about late, inaccurate, or missing deliveries. That way, your relationship with your customers or clients will be on a higher level.

4. Warehouse space optimization

WMS tracks item flow in the warehouse. You know the exact position of every item on the shelf, in which row they are, and in what part of the warehouse, all of that in real-time. All changes, including picking, transferring, or counting, are noted in WMS. Tracking improves picking and inventory accuracy and reduces possibilities for errors.

WMS has many unique features like intelligent picking, rotation of goods, commissioning, and automatic consolidation to maximize storage space. The most important of these is directed put-away. Whenever you are receiving some goods, WMS can tell how and where to put away every exact item. There are many different rules for put-away. For example, you can use fixed or dynamic locations. Fixed locations are used for a specific type of item, which benefits in better organization of your warehouse layout and speeds up the putaway process since staff knows in advance where those items should be placed.

Dynamic locations, on the other hand, involve storing items in the first available, temporary location that a warehouse can find. It’s quick and versatile and has to have a real-time WMS implemented. Real-time information and advanced software-managed methodologies for moving goods through the warehouse can utilize expensive storage space with more efficiency.

Simultaneously, management and other company departments will all have needed information about warehouse utilization as the changes happen.

5. ERP integration and ROI

Quality Warehouse Management System can easily connect and integrate with your Enterprise Resource Planning (ERP) solution or other business intelligence software your company uses. There is no need for extra steps for integrating data from WMS to other company systems outside of the warehouse. Once integrated, data flow is automated and documents are exchanged in real-time.

By investing in WMS, you will for sure witness a positive return on investment. WMS influences sales and increases profits in a simple way. You will sell faster and more accurately, and customers will be more satisfied. Simultaneously, warehouse workers can store goods more efficiently, spend less time on their job, and make fewer mistakes. All these factors lead to increased profit margins and lower costs.

Investing in the software warehouse system

WMS is a software solution with hardware components. It’s important to check whether your WMS provider can provide tailor-made solutions for your warehouse and your specific needs. Every warehouse is different, and you should be able to cover all your processes with your new software.

Warehouse management is an essential part of logistics for every serious company. It’s a missing piece that enables improved accuracy and efficiency. Better warehouse management leads to business improvement on a company level and in the supply chain from manufacturer to delivery.

An efficient warehouse directly influences customer satisfaction, and higher efficiency leads to cost-cutting, which are crucial keywords for company management.

If you’d like to find out more, don’t hesitate to contact us.