What is a Warehouse Management System (WMS)?

The Benefits of using a warehouse management system

Warehouse management comes with its challenges including maintaining visibility of inventory, managing warehouse operations and keeping control of the movements of stock and staff. 

A WMS system has many benefits including reduced inventory costs, better customer service, automated operations and more. Let’s take a look at these benefits in more detail:

Easily identify customer profitability

• Emphasise how the WMS helps identify and maximise customer profitability through data-driven insights.

Reduced inventory costs

A WMS can aid warehouses in getting total transparency of the stock being held, and by having that, can optimise their forecasting efforts to ensure they have the right inventory levels, therefore reducing the cost of storing excess goods that are slow-moving. Additionally, warehouses can reduce inventory costs by only ordering replenishments when required and minimising the potential of having lost or dead stock.

Improved customer service

Excellent customer service is the hook that will ensure customers are loyal and return time after time. A WMS can help businesses to improve their overall customer service by enabling fast and reliable processes that get their orders to them on time and in full. Furthermore, a WMS can unlock personalisation opportunities for customers based on their needs and preferences - leading to increased customer loyalty. 

Leverage automation

Warehouse activities involve many tasks and processes that are labour-intensive and prone to human error. Utilising a WMS can automate manual tasks such as stock allocation, batching orders for picking and arranging shipments, freeing up staff members and time for strategic activities and minimising errors.

Ease of integration

A WMS will typically offer API integrations to systems that compliment the business operations and ease some of the workload. These can include: 

• Shopping carts and ecommerce marketplaces
• Couriers and multi-carriers
• ERP, CRM and accounting software

By having these systems integrated, crucial business data is transferred with minimal effort or human involvement, for better decision-making and control of warehouse operations.

The role of a WMS in warehouse management

Warehouse management aims to simplify and streamline warehouse operations, ensuring products are in the right place, easy to find and that any warehouse floor activities are easy for staff to perform. Warehouse management is a large part of a business’ supply chain, as it includes the receiving, storage and movement of materials or products through to shipping.

A warehouse management system (WMS) can aid warehouses in putting processes in place to ensure optimal warehouse management. They play a crucial role in digitalising processes such as stock movements, inventory management and picking activities by keeping digital records of stock, utilising product barcodes and automating workflows.

Types of warehouse management systems

There are multiple types of warehouse management system available and each offer different features and benefits. Below are the 4 types of WMS: 

• Standalone WMS 
• Cloud-based WMS
• Integrated ERP system
• Supply chain module WMS

Standalone WMS

A standalone WMS is on-site software that will typically be hosted by a business’s own server or local hardware. While the software features will differ for each provider, a standalone WMS will typically offer warehouses the essential features required such as inventory tracking, order management and labour management.

A standalone WMS is best suited for small to medium businesses due to its easy implementation, short set-up time, essential features for warehouse management and limited additional functionality or integration options. 

Pros: A standalone WMS focuses directly on the day-to-day management of a warehouse, therefore its features are specifically designed to improve warehouse processes and operations.

Cons: A standalone WMS will restrict the ability for businesses to integrate the system with other software, as well as limit scalability opportunities. 

Cloud-based WMS

A cloud-based WMS is a web-based software that is hosted on external servers. It requires no on-site installation and can be accessed from any device that has internet access and a browser. Cloud-based software offers the essential features that a warehouse needs such as inventory tracking, order management, and picking and packing while also allowing integrations to other systems and being scalable. 

Cloud-based WMS software is suitable for all sized businesses with simple and fast implementation, the essential warehouse management features and the flexibility needed to growing and evolving businesses. 

Pros: Cloud-based WMS software offers increased security by being hosted on external servers, is maintained by the service provider and any new development will be implemented with no down-time.

Cons: Cloud-based software is typically purchased as a subscription basis and is owned and maintained by the service provider, therefore if ownership and full control is desired, a standalone WMS may be more suitable.

Integrated ERP system

An ERP system, or enterprise resource planning system is a software that covers multiple core applications such as HR, accounting, marketing and supply chain management. Not all ERP systems include warehouse management features, and can sometimes be a complementary or add-on function. Whether included or an add-on, ERP systems with WMS functionality will help businesses to control inventory and day-to-day warehouse operations. 

An ERP system is suitable for businesses with large supply chains and that require warehouse management functionality, alongside their other essential business operations like accounting and marketing. 

Pros: The cross-system functionality offered by an ERP system means businesses only require a single software platform to manage multiple parts of their operations, which can be beneficial to large organisations.

Cons: The cost of an ERP system can be expensive - this is due to the accumulation of implementation, subscription and infrastructure costs. Additionally, they can also be complicated to set up, and therefore, businesses should consider if this breadth of functionality is essential, before choosing an ERP system.

Supply chain module WMS

Supply chain software provides control of a businesses entire supply chain, from beginning to end; warehouse management is a small part of that, and therefore can be offered as a module within supply chain software. 

Supply chain software is suitable for businesses that are in need of the additional functionality it offers, on top of warehouse management; this includes features such as manufacturing and raw material handling, transport management, customer service and vendor partnerships. 

Pros: Supply chain software with a WMS module will allow seamless data transfer between the different areas of the supply chain, with real-time visibility of warehouse operations and other supply chain processes.

Cons: As supply chain software includes so much functionality, your business may not require all of it; therefore the investment into this type of software may not be worthwhile if you only need the WMS module.

Features of a warehouse management system

A warehouse management system is designed to take stress away from staff members by streamlining operations, replacing some of the manual tasks, and increasing efficiency through automated workflows.

Below are some of the key features a WMS can offer and how they can ease the workload in a warehouse:

Goods in

Goods in is a crucial part of any warehouse’s operations as mistakes at goods in will continue to affect any action that follow. A WMS will provide visibility of expected deliveries as well as details of what is due to arrive, so resources can be planned accordingly and support the use of ASNs (Advanced Stock Notification) as best practice. A WMS should also support blind receipt so unexpected deliveries can also be booked into inventory. 

Inventory Management

Warehouse management software should host a real-time view of inventory levels and locations within the warehouse. Any stock movements, including goods-in, any movement within the facility, and goods out should be logged to enable full traceability and transparency. This will be extremely useful if there are any product recalls and for instant reconciliation.

Location Management

A WMS should support the use of unique identifiers for each storage space in a warehouse, or across multiple warehouses, including location IDs taking into account aisle, column and shelf, and warehouse zones such as pick faces, bulk storage, goods in locations and any controlled storage areas. Some WMS software will even support a visual warehouse map for a high level overview, at a glance.

Picking and Packing

WMS software will typically support various pick models such as tote, wave, bulk or zone picking, depending on what is most suitable and should have the functionality to assign the relevant picking model to each batch of orders. A WMS with barcode scanning functionality should also offer the ability to verify items by requiring a barcode scan as the item is picked.

Integrations

A WMS with integration capabilities is becoming more essential, especially for warehouses involved in ecommerce fulfillment. Being able to connect to and instantly receive orders from ecommerce sales channels is a feature that saves time and removes the need for rekeying data from one system to another. 

Equally for ecommerce, there is often a requirement for carrier API integrations to ensure efficient delivery from a multitude of carriers that offer a variety of delivery speeds, both nationally and internationally. 

Additional integrations that WMS systems may support are:

• Payments
• Accounting 
• CRM
• ERP

Reporting and Analytics

One of the perks of having software for warehouse management, is the wealth of data the system holds. This can provide insights into business performance, inventory, profitability, KPIs and SLAs through reporting and real-time analytics features, to support informed decision making that can further optimise warehouse operations. 

Should you choose a cloud-based WMS? 

Cloud WMS software is becoming increasingly popular due to the wealth of features offered, the flexibility offered to growing businesses and the lower burden of cost, implementation and maintenance than the alternatives. 

Cloud software’s off-site hosting, availability anywhere from a browser, increased data security and external IT support means that a cloud WMS is a viable option for businesses of any size.

Unleash your warehouse's potential. Schedule an Access WMS demo today!   

Warehouse management systems are becoming a standard requirement for modern businesses involved in warehousing and ecommerce fulfillment. Gone are the days of tracking inventory, orders and shipping via spreadsheets and multiple systems.

By implementing a WMS software such as Access WMS, operations can be streamlined, inventory, operations and warehouse staff can be well organised and processes can be automated into intelligent workflows that minimise errors and increase speed.

You can find out more about Access WMS by downloading a copy of our brochure, or by booking a demo with one of our product experts.