4 benefits for businesses using warehouse management systems
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Your warehouse is one of your business’s busiest areas.
Sitting in the middle of your manufacturing, production, and supply chain operations, the warehouse holds materials used and produced in your processes. That said, having an inefficient warehouse can significantly cost your business and reduce customer satisfaction.
Warehouse management systems can help solve major challenges in your supply chain operations. For more details on this matter, continue reading this article.
Understanding warehouse management system
A warehouse management system or WMS refers to a business solution that helps optimize and streamline all your warehouse processes. This type of software is most commonly used in the retail and manufacturing industry, allowing businesses to track all goods and materials as they enter and exit the warehouse.
Its main goal is to help ensure that materials and goods move through your warehouse in the most cost-effective and efficient way. In general, a WMS handles numerous functions that allow these movements, including inventory tracking, receiving, picking, and putting away.
Benefits of using a warehouse management system
- Improves visibility and transparency
Perhaps, the most significant benefit of a WMS is that it provides real-time visibility of inventory levels. This allows businesses to have more precise estimates and forecasting of supply, preventing backorders or holding excess warehouse inventory.
Furthermore, some WMS also features RFID technology and other location-tracking methods that ensure visibility of inventory. This allows your staff to document materials or goods as they enter the warehouse, tracking their storage location and movement on the warehouse floor, up until they leave your warehouse and are delivered to your customers. This helps in reducing situations where an item becomes misplaced, forgotten, or lost within the warehouse.
Other than inventory visibility, a WMS also provides team transparency with accurate documentation and reports on inventory. Your staff can tap into operational reports as frequently as necessary, allowing them to see and respond to key trends in your warehouse as they happen.
- Reduces expenses
Businesses are always looking for ways to reduce their operational expenses. And, although getting a reliable warehouse management system may seem like another expense, it’s actually a more cost-effective move than continuing with manual warehouse management.
A reliable WMS allows for efficient use of labor and space, reducing waste. It does so by analyzing and optimizing the best use of space and calculating the optimum location for each material and item, ultimately providing more space to squeeze in a few more materials.
It also helps in reducing the potential costs of excessive material movement, time-consuming placement, and retrieval of goods. Furthermore. WMS systematically optimizes your warehouse space and travel path.
Also, perhaps, the most expensive component of running your warehouse is your worker. Thus, the more effective you are in handling labor, the lower your operational expense will be. With a WMS, you can streamline the labor and processes in your warehouse, which allows you to allocate fewer people to each part of your supply chain. This allows you to assign your workers to more productive tasks.
- Enables other warehouse tools
Choosing the right WMS for your business allows you to seamlessly enable other tools and automate processes within your warehouse.
A reliable WMS is versatile enough and can integrate and work with other solutions to ensure a wholly optimized supply chain.
For instance, basic WMS allows for the integration of barcodes and RFIDs for seamless tracking of inventory. A good WMS should also link with your transportation management system or fleet management system that provides you with a holistic insight that extends beyond your warehouse and allows for greater accuracy for delivery goals.
Other levels of automation include robotics, AI, automated material picking and packing, and data-driven forecasting. A good WMS can assist in the implementation and integration of these technologies by serving as the core element for capturing, recording, and communication.
- Improves supplier and customer satisfaction
The right WMS improves and elevates the relationships that your business has with all parties in your supply chain—both customers and suppliers.
As WMS helps in efficiently running your warehouse, it helps in reducing order errors and delivery lead times. As a result, customers receive their packages on time and without any issue. This increases customer satisfaction and boosts sales.
This efficiency also extends to the supplier side. If your warehouse is optimized, you can accept incoming materials and orders from your suppliers without any delay or issue. As a result, your supply chain partners can move on to their delivery or task much faster, reducing friction with your suppliers.
Takeaway
In this modern business era, taking advantage of a reliable warehouse management system allows you to streamline your inventory and production. It serves as a strong foundation for more efficient operations and proves to be a powerful step towards building a better and more profitable business.