Warehouse Management System — Why to get it?
Warehouse Management System is the need of the hour for every SMEs and Third-party logistics provider as the maximum goodwill of any business depends on its customer service leading to their satisfaction. But before looking why WMS? We need to analyze what is WMS.
WMS or Warehouse Management System is a software application which allows the business to optimize the functioning of warehouse inventory by providing transparency, accountability, efficient management of the resources and reducing errors leading to optimum utilization of the time and resource. It is becoming an integral part of the supply chain of the goods.
Now let’s look at why WMS?
WMS leads to smooth operation in the warehouse as it provides an additional advantage to it, staff, in controlling and managing the movement and storage of goods in and out of the warehouse.
But if we look at this more technically it provides a certain benefit. If we analyze, we get
1) Cost Benefits
Warehouse Management Systems generally aims at reducing the operational cost by providing automated services, removing errors, and predicting an unforeseen risk or loss. WMS leads to a better return on investment in a business.
· WMS provides a systemized picking and delivery system which makes reduces the requirement of manpower which constitutes around 40–50% of warehouse operating cost. So, by choosing WMS the cost of picking and delivering is reduced by 40%
· WMS also reduces the cost of inventory as it allows a better classification of the good and stores data more efficiently which allows the system to indicate the requirements of the goods in the right quantity at the right time which reduces the wastage in inventory hence preventing losses.
· WMS enables the proper data analyses of the inventory and tracks the performance of the operation; therefore, it helps in predicting any loss which may occur or any risk associated with operations.
2) Intangible Benefits
WMS increases the overall efficiency by effective management of the inventory hence improving the return of investment, leading to more profits. These profits can be later on used to expand and grow the warehouse business.
But sometimes in the business, we forget about the satisfaction and mental peace of the entrepreneurs. WMS enables you to increase leisure time as it reduces the physical inspections, so the entrepreneurs can use their time to go on a vacation or spend it with family or just take a break from hectic business life.
3) Does WMS provide for customer satisfaction?
The answer is, Yes. Proper implementation of WMS reduces the error in the inventory so the customer gets what they exactly want in the right quality and quantity. WMS also leads to better classification of the goods in the inventory; therefore, it becomes easy for the business to ship the goods leading to faster delivery of the goods. Also, the shipment process automated therefore it may reduce the shipping cost.
There is a concept of reverse supply chain and WMS is an indispensable part of it. Reverse supply chain allows the customer to send goods back in case the goods do not meet the satisfaction of the customer. This adds more value to any organization’s goodwill.
All these factors add to customer satisfaction and increase the loyalty and confidence of the customers.
4) Error Proofing and Speed of Order Processing
As the Warehouse Management system automates the processes at the warehouses which almost eliminates the use of traditional picking practices, WMS hence saves the time of the entrepreneur. As the system has every data stored in its database, the orders are processed at a faster rate as the goods in the warehouse have their own unique serial nos. and the software automatically allocates the order with the goods they demand.
Let say if an organization used to take 35mins to process a single order now with the use of WMS the time will cut short up to 35–40%, so the time will reduce to around 12–14 minutes. Saved time will lead to more processing of orders leading to more profits.
Now as we discussed everything automated and organized by the system database it reduces the human error in the picking and delivery of the goods. The customer gets what they want and the organization does not bear the loss on the wrong shipment of the goods. Therefore, WMS overall reduces the errors leading to more effective and efficient output from the services.
5) Track ability and Traceability
The most important factor in WMS is track ability and traceability. It is not wrong to say that they are the spine of the Warehouse management systems. So, if WMS is implemented properly it allows the track ability of the goods from the point where they are stored to the customer’s doorsteps.
What this actually does is that it allows both customers and providers to track and trace the actual path of the goods that have been shipped so that the communication gap between both could be minimized. Also, it helps the business to provide after-sales customer services and helps them to maintain a record in case the customer lodges a complaint or claims that shipment is faulty or not received.
It builds trust between both customers and business which is a key element to any successful organization be it SEMs or 3PL providers.
WMS is the change that is needed to Succeed. As the business world is growing it allows the users to adapt to it. The benefits of WMS can be summarised into two major points-
· Efficient Optimization of the warehouse processes
· Increase in goodwill and customer satisfaction.
These are the key reason for any business to succeed, and proper implementation of WMS ensures the same. So, the question we started with was ‘Why WMS?’ because it’s rewarding.
