How to Maximize Warehouse Potential with the Benefits of Implementing a WMS 

Effective inventory management involves a complex array of tasks that need to be seamlessly integrated. Today, warehouses must synchronize with multiple channels, stay current, and efficiently manage both fulfilment and returns. But a manual inventory management system runs the risk of undermining productivity, which would directly impact sales. That’s where a cloud-based (SaaS)​ ​Warehouse Management System (WMS) offers a powerful solution, by enhancing inventory visibility and streamlining operations through automation. In fact, poor inventory management can lead to a staggering 24% loss in annual profits [1]. Additionally, companies that implement a WMS can experience a 20-35% reduction in labor costs.

A SaaS based WMS delivers substantial benefits, including reducing errors and accelerating processes. Its functionality extends beyond traditional warehousing, offering advanced capabilities for tracking inventory with pinpoint accuracy from the moment stock enters the warehouse.

In this article you will experience the advantages of a WMS as we explain:

• How a WMS Fuels the Growth of Businesses
• Benefits of implementing a WMS
• Conclusion: Embracing the Future of Warehouse Management

​How a WMS Fuels the Growth of Businesses

​​Several well-known brands using Warehouse Management Systems are a testimony to the success of this technology in logistics. For instance, Amazon relies heavily on sophisticated WMS technology within its vast fulfilment network. This system helps manage extensive inventories, optimize warehouse layouts, and ensure rapid order fulfilment, reinforcing Amazon’s reputation for fast delivery and efficient logistics.

As for TresGo, an e-commerce enabler that provides storage, packing, and delivery services, it has significantly enhanced its operations through Anchanto’s WMS technology. TresGo transitioned to Anchanto to leverage robust solutions for inventory syncing, order management, and overall inventory management. This switch enabled them to streamline operations, seamlessly integrate orders from various sales channels, expand their product range, and manage inventory efficiently by expiry dates. Their advanced WMS not only supports their current needs but is also responsive to future requirements and concerns.

UrStore is another e-commerce enabler that provides warehousing, transportation, and web store management services, that improved its efficiency and accuracy by implementing a WMS. Faced with the challenge caused by costly errors, UrStore adopted a WMS to streamline order processing, inventory management, and stock placement. The user-friendly WMS software with integrated handheld devices simplifies training and operations for the team.

The success stories of these prominent brands underscore the transformative impact that a robust WMS can have on business operations. Let’s delve deeper into the myriad benefits of implementing a WMS that can contribute to a more effective and responsive supply chain process.

Benefits of implementing a WMS

By leveraging advanced technology and real-time data, a WMS offers many benefits that can greatly enhance how warehouses operate. In this section, we will explore the key advantages of implementing a WMS, including enhanced inventory accuracy, increased operational efficiency, better space utilization and more. Whether you’re a small business or a large enterprise, understanding these benefits will help you make an informed decision about incorporating a WMS into your operations for long-term success.

1. Enhanced inventory accuracy

​​One of the foremost benefits of a WMS is its ability to significantly improve inventory accuracy. Traditional manual inventory methods are prone to errors such as miscounting and misplaced items. WMS solutions leverage real-time data and automated processes to maintain accurate stock levels, reducing discrepancies and ensuring that inventory records are consistently up-to-date. Businesses that use WMS report that it enhanced inventory accuracy in the form of stock inbound and outbound activities, stock forecast and management reports. Additionally, in the event of stockouts or low inventory, the SaaS technology stack enables partial order fulfillment.

2. Increased operational efficiency and productivity with a WMS

WMS systems streamline warehouse operations by automating various tasks, from order picking and packing to shipping and receiving. This automation reduces the time and labor required for these processes, leading to more efficient workflows. For instance, a WMS can optimize picking routes, reducing the time spent locating and retrieving items. The result is a more agile warehouse that can handle higher volumes of orders with greater speed and accuracy. Studies show that warehouses using ​a ​WMS can achieve up to 20% reduction [2] in operational costs due to these efficiency improvements.

3. Better space utilization

Effective space management is crucial in warehouse operations. A WMS helps maximize the use of available space by optimizing inventory placement and layout. The system can analyze storage needs and recommend the best locations for items based on their size, weight, and turnover rate. This optimization not only increases storage capacity but also improves accessibility, reducing the time required to locate and retrieve products. As a result, warehouses can operate more efficiently without needing additional physical space.

4. Enhanced real-time visibility

Real-time visibility into inventory levels and warehouse operations is a major advantage of WMS. These systems provide up-to-date information on stock levels, order status, and warehouse performance metrics, allowing managers to make informed decisions quickly. This visibility also facilitates better forecasting and proactive planning, enables businesses to detect inefficiencies, reduce bottlenecks, and implement corrective measures in a timely manner.

5. Data-driven decision making

WMS solutions provide valuable insights through comprehensive reporting and analytics. Businesses can access detailed reports on various aspects of warehouse performance, such as inventory turnover, order accuracy, and labor productivity. This data-driven approach enables warehouse managers to identify trends, measure performance, and make informed decisions to optimize operations. By leveraging these insights, 3PLs can implement strategies to improve efficiency, reduce costs, and enhance overall warehouse performance.

6. Integration with other business systems for seamless operations

Integrating a WMS with Enterprise Resource Planning (ERP) tools, Customer Relationship Management (CRM), last-mile carriers, marketplaces, and other key business applications is essential for seamless operations and efficiency. This integration streamlines data flow, enhances communication, and boosts collaboration across departments, resulting in a more connected workflow and improved overall performance in marketplaces, webstores and carriers.

7. Increased compliance and risk management

​​A ​WMS can ensure adherence to various compliance requirements by maintaining accurate records and providing traceable inventory and shipments. For instance, in a pharmaceutical warehouse, a WMS tracks inventory with batch numbers and expiration dates, generates detailed records for audits, monitors environmental conditions like temperature, and controls access to sensitive areas. This automated approach supports adherence to regulations such as Good Manufacturing Practice (GMP), reduces the risk of errors, loss, theft, or expiration, and facilitates efficient reporting and inspections.

8. Cost savings and ROI of implementing a WMS

Implementing a WMS not only brings operational efficiencies and improved productivity but also leads to significant cost savings and a high return on investment (ROI) for businesses. By automating key processes, optimizing workflows, and enhancing accuracy, businesses can reduce labor costs, minimize errors, and improve overall operational efficiency, resulting in tangible cost savings.

Conclusion: Embracing the Future of Warehouse Management

Embracing WMS benefits is not just a strategic move but a necessary evolution for businesses aiming to stay competitive in an increasingly complex market. The global WMS market is projected to reach $10.3 billion by 2026, growing at a compound annual growth rate (CAGR) of 14.2%. This surge reflects the growing recognition of a WMS as a critical component in enhancing supply chain efficiency.

With advancements in technology such as artificial intelligence, machine learning, and real-time data analytics, modern WMS solutions are becoming more sophisticated, offering unprecedented levels of automation and insight.

FAQs

1. What is a WMS?

A Warehouse Management System (WMS) is a software solution designed to optimize warehouse operations and manage inventory, from receiving and storing goods to picking, packing, and shipping orders. It enhances efficiency by providing real-time data on inventory levels, locations, and movement, helping to streamline processes and reduce errors. An advanced WMS can integrate with other systems, such as ERPs and TMS, to ensure seamless operations across the supply chain.

2. What is SaaS technology?

​​Software as a Service (SaaS) is a cloud-based technology that delivers software applications over the internet. Instead of installing software locally, users access it via a web browser, with the provider handling hosting, updates, and maintenance. This model offers several benefits: lower upfront costs, scalability, and accessibility from any internet-connected device. Users also benefit from automatic updates and reduced IT management, as the provider manages the software’s upkeep. Anchanto has robust and scalable SaaS products for e-commerce and logistics operations such as order management, warehouse management, parcel tracking, digital shelf health management, and more. ​

3. What is a legacy warehouse management system?

​​A legacy warehouse management system (WMS) is an older software solution used to manage warehouse operations, typically characterized by outdated technology and infrastructure. These systems were designed and implemented many years ago and may rely on traditional database systems and outdated programming languages. They might lack the advanced features and integrations found in modern WMS solutions, such as real-time data access, automated processes, and cloud-based capabilities. While legacy WMS can handle basic inventory and warehouse management tasks, they may struggle with scalability, integration with new technologies, and meeting the evolving needs of modern supply chains.​​​

References:

[1] – mytotalretail.com – Hidden Costs of Poor Inventory Management

[2] – mckinsey.com – Improving warehouse operations—digitally

[3] – marketsandmarkets.com – Warehouse Management System Market Size, Share and Growth