Warehouse Management System: What it is and why you need it in your warehouse

For any business that wants to increase its operational efficiency, reduce its costs and enhance customer loyalty, optimizing the supply chain is essential. An integral part of this chain are, of course, warehouses, which need very good management.

A warehouse management system (WMS) can help with good management and optimization. But what exactly is a warehouse management system and why is it so useful in your warehouse?

What is a warehouse management system?

A warehouse management system (WMS) is software that helps companies manage and control the day-to-day operations of their warehouse. Control begins from the moment goods and materials enter a distribution or fulfillment center until the moment they leave it. WMS software systems are a key component of supply chain management and provide real-time visibility into a company’s entire inventory, warehouses, and distribution. In addition to inventory management, a warehouse management system offers useful tools for picking and packing processes, resource utilization, analytics, and more.

Software designed specifically for warehouse management can provide insightful information about a company’s operations, which can help management make informed decisions about the company’s future. The warehouse management system can be connected to ERP and TMS systems to provide a complete picture of the supply chain in a very simple way.

What does a warehouse management system do?

The key features of a warehouse management system support certain activities:

• Helps manage the receipt and distribution of inventory as the warehouse flow is no longer done manually.
• Makes inventory management more efficient. Warehouse management software provides real-time visibility into inventory at any location, including items in transit and in stores.
• Picking, packing, and fulfilling orders becomes simpler. Warehouse management systems can help reduce the costs of these processes.
• Shipment tracking is more accurate. Many warehouse management systems integrate with transportation and logistics management software, which allows for countless ways to speed up the fulfillment process.
• Provide easier labor management. A warehouse management system can provide real-time visibility into warehouse workers, labor costs, response times, productivity gaps, trends against plan, and more, so companies can react accordingly.
• It helps truck drivers quickly find the right loading bays.
• Real-time data can be automatically collected through a warehouse management system instead of relying on manual data collection methods, eliminating typing errors and drastically speeding up the process. This data can be integrated with analytics to track important metrics such as on-time shipping, inventory accuracy, distribution costs, order or line fill rate, order cycle time, and more.

Why does your business need a warehouse management system?

Any business, from a start-up to a large corporation, that takes physical inventory of its inventory can benefit from an effective warehouse management system. But why?

Warehouse management systems boost efficiency

A warehouse management system automates a wide range of tasks, such as receiving goods, managing storage locations and inventory, allocating tasks to logistics operators, picking orders, managing shipments and returns, thereby boosting both productivity and efficiency, as well as inventory management.

Reduce waste and costs

Warehouse management software can identify which items need to be picked first or which may need a little push in sales to minimize waste. It can also help you determine the most efficient use of warehouse space, from inventory placement to optimal movement routes.

Have real-time visibility into your inventory

A warehouse management system gives you real-time visibility into your inventory as it moves into, around, and to the next location. With this visibility, you can create more accurate demand forecasts, implement a timely inventory strategy, and improve traceability, which is especially important in the event of a recall.

Better manage the work that goes into your business

A warehouse management system can help you predict labor needs, create schedules, optimize travel time within a warehouse, and assign the right job to the right worker based on skill level, proximity, and other factors.

Build better relationships with your customers and suppliers

With a warehouse management system, customers enjoy improved order fulfillment, faster deliveries, and fewer inaccuracies, which increases customer satisfaction and loyalty and improves your brand reputation. Suppliers can also experience reduced wait times, which will lead to improved relationships.

When to integrate a warehouse management system into your business?

There is no set rule for when you should invest in and integrate a warehouse management system into your business, but there are a few things you can think about before making this decision. If you are experiencing frequent errors in your order picking or inventory management processes, if your business is growing rapidly and you are finding it increasingly difficult to manage your warehouse operations manually or with your existing application, these are signs that you should integrate a WMS.

You may also be looking to reduce operating costs while maintaining or improving service quality, or to receive and ship orders faster in order to better meet your customers’ demands.

Some other factors may be your difficulty managing periods of high demand, planning to deploy mechanized or automated systems in your warehouse, or needing detailed traceability capabilities for products, expiration dates, and batches.

Is a warehouse management system connected to an ERP system?

Of course, and some warehouse management systems are built as modules or applications that are integrated into ERP and supply chain platforms. The advantage of these is that they can be better combined with other solutions in areas such as accounting and business intelligence. They provide a holistic view across the entire business and supply chain, enabling end-to-end transparency and orchestration and execution of warehousing and logistics processes together.

Implementing a Warehouse Management System (WMS) can transform your business, improving inventory accuracy, order speed, and overall efficiency. Whether you run a small warehouse or a large logistics operation, a WMS gives you the tools to streamline your processes, reduce costs, and enhance the customer and partner experience.

If your business is facing challenges in inventory management or warehouse efficiency, it may be time to consider adopting a WMS. The right technology can give you the competitive advantage you need to grow and stay ahead of the market.