E-commerce logistics is all about fulfilling customer satisfaction—and customers these days expect an easy and smooth shipping experience with benefits like one-day delivery and shorter lead times. This is where a warehouse management system (WMS) comes into play.
Warehousing is the storing of goods that are further sold or distributed to potential customers. A WMS consists of software and processes that manage the end-to-end operations of a warehouse. Every action in the warehouse that allows organizations to control and administer procedures right from when the goods enter a warehouse until they move out is managed by the WMS.
The WMS is responsible for the flow of inventory within the warehouse. This includes everything from receipt of the product to putaway, replenishment, and shipping. To put it simply, the WMS plays a critical role in managing the activities of a warehouse.
It helps in tracking the real-time movement of inventory in the warehouse while integrating with order management systems or shopping channels. The WMS can also be combined with ERP systems like Tally, Navision, and Oracle to provide end-to-end visibility to the finance and procurement teams.
The warehouse management system performs the following tasks:
- Creation of item data master falls (item details, SKU code, MRP, bar codes)
- Purchase order or stock transfer note creation
- Quality check enabled goods receipt note
- Placement of inventory on shelves with pre-assigned addresses
- Pick inventory against the received orders
- Generate shipping labels or invoices
- Track the order lifecycle
- Provide data visibility of the charges, inventory availability and dispatch status
The purpose of a WMS is to help ensure that goods and materials move across a warehouse in an efficient and cost-effective manner.
A WMS handles many functions that enable these movements, including inventory tracking, picking, receiving, and putaway.
Goods and products received by the supplier get checked along with the packing documents. Next, the goods are inspected for damage. This process involves many activities, and any interruption in this step can influence the entire operation.
Picking uses many resources and usually takes 60% or more of the warehouse’s staff to perform the process. It means that it has a significant influence on the supply chain’s productivity.
Putaway is the process of moving goods from the receiving area to their storage area. This process includes estimating the resource and space elements for each product. Goods that are similar to each other are usually held together to be located and distributed efficiently.
Shipping is sending your orders to their respective customers. The shipped goods are packed early to avoid cluttering in the staging areas, leading to late deliveries and confusion. The process generates packing lists and invoices for the shipment and sends advance shipment notifications to the recipients.
Packing includes combining all the items of an order together and getting them ready for shipment. Warehouse workers can also use lot zoning and task interleaving functions to do the pick-and-pack tasks most efficiently.
The idea of a warehouse management system in India is new and latest compared to the other countries. The Indian warehouse management system market is comparatively more recent than many other countries, mainly because of a lack of awareness and demand for quick returns on investment.
Advantages of a Warehouse Management System
A WMS is one of the necessary aspects of any e-commerce business, whether small or big. Getting a warehouse set up for your business can prove to be very profitable. A warehouse for a business can resolve several issues such as order management, fulfillment, customer support, shipping costs, and many more.
- Improved space and lowered operating expenses
Warehouse management systems optimize warehouse flow by analyzing the best use of floor space based on the task and material characteristics. A warehouse can lower its operating expenses by considering the best locations for products and materials. This also lessens potential costs resulting due to excessive material movement, time-consuming placement, and retrieval.
- Inventory visibility
Using a warehouse management system also provides visibility of accurate, real-time inventory levels. This enables a company to estimate supply and avoid backorders, which leads to more satisfied customers.
Using WMS automation with scanning or other location-tracking methods ensures inventory visibility at the location. It reduces the non-WMS enabled situations where inventory becomes forgotten, lost, or misplaced within the warehouse.
Product demand and seasonality are reflected as items are transacted, and information is communicated. Therefore, planners can make reliable decisions about which products to adjust to increase revenue or mitigate losses with this information.
- Traceable materials
Inventory materials can be easily traced with warehouse management systems using a lot, batch, and serial numbering. Lot or batch numbers indicate where the materials were made, and the serial number identifies an item specifically. Tracing materials by a warehouse lowers potential redundancy, enables accurate inventory planning and allocation, and provides information that can be retrieved for better visibility, service maintenance, or recall situations.
- Internal automation benefit
Automation supports ongoing improvement in existing operations through improved strategies. There are many different levels of automation available from automated picking and packing, robotics, analytics-driven movements, and AI. Warehouse management systems support these strategies by providing the foundational elements to capture, record, and communicate activity.
For example, sensors, barcoding, pick-to-light, voice, and automated carousels can all increase throughput when integrated into a WMS by monitoring picking and packing activity. The use of robots and automated conveyors can streamline operations and reduce bottlenecks.
- Effective shipment management
Warehouse Management System can efficiently manage inbound and outbound planning by adjusting movements of inventory and equipment. As inventory is scheduled for arrival, the exact date and time can be optimized, recognizing available labor and equipment for storage tasks.
Warehouse management systems can also pick and pack products more effectively as managers can choose between zone, batch, or wave picking in a way that lowers any holdup or issues caused by traffic or ineffective employee locations.
Any small or big business needs a warehouse management system to scale the industry and improve profitability. Leveraging a WMS can help businesses reduce labor costs, improve inventory accuracy, improve flexibility and responsiveness, decrease errors in picking and shipping goods, and improve customer service.