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WMS for Warehouse – Complete Guide

A warehouse management system (WMS) is software and processes that allow organizations to control and administer warehouse operations from the time goods or materials enter a warehouse until they move out. Operations in a warehouse include inventory management, picking processes and auditing.

What is a WMS?

A warehouse management system is a software application designed to support and optimize warehouse functionality and distribution center management.

Why do you need a WMS for warehouse?

Warehouses have to store, process and distribute large volumes of goods and materials, therefore information flows must be well managed, organized and structured.

A WMS allows for creating procurement, delivery, storage, distribution and return processes according to the specific needs of the warehouse.

Warehouses are often very large buildings that have many manual and automated processes which require proper organization.

A WMS is a mega computerized platform which helps warehouses to keep a consistent flow of information through various processes and it also helps to get a better understanding of procedures.

A warehouse management system works on the basis of the information about a specific location and stock of a product which helps to bring order in the chaos.

What are the components of a WMS?

Information Flow Management

This is one of the basic components of warehouse management system which allows companies to have information on the roles and responsibilities of the personnel involved in particular processes of warehouse operations.

Tracking Management

A warehouse management system helps to track the location and transport actions of goods in the warehouse, for example if an employee is responsible for the movement of goods from one location to another.

A location tracking system keeps track of the goods, from the time they are picked up until the time they are placed on the available delivery services. In case of a container in a container terminal, a system will know the time at which a container was placed on the ship and when it was offloaded.

Container tracking is a real-time process that makes sure that containers are loading only when they have been correctly processed.

Auditing Management

This is a feature of the warehouse management system that shows who issued what, when, and why.

For example, it can provide details on invoices and payments and tell exactly how much money was spent by the company and on what.

The system can also manage the dispatching process by showing details of products in some warehouses and not in others. It can show if a container has been kept in the wrong place because of the wrong labels or if the wrong labels were put on the containers.

WMS solution can also assure the smooth flow of goods to various customers and assurance that the system supports a redundant supply chain, which helps to manage the costs.

Distribution Management

A distribution management process is the process that takes place to deliver products to the customers.

A distribution management system provides details on the supplies and works in coordination with the needs of the customers and the warehouse data.

A distribution manager has to be able to monitor the amount of goods that are in storage and how many are required on the shelves in anticipation of future purchases. Also important is knowing how much stock was delivered on a daily basis and where that stock has gone.

A distribution management system is a tool that helps to make the calculation of stocks more accurate and it also guarantees the accurate delivery of products.

Product Management

A product management system in a warehouse management system keeps all of the relevant information about each product that enters the warehouse. This allows the warehouse manager to know exactly where each product is and what it is doing.

Performance Management

Performance management is an important part of the warehouse management system that allows a warehouse to know what their performance is and how long and product will take to be delivered. It is a system that allows the management to check if the product will arrive in time or not.

Workflow Management

Workflow management is the central sorting system that shows the flow of products from the warehouse to sales, and it may take into consideration costs.

Load Optimization

A load optimization system will let the warehouse manager know how and what the workload will be, including actual consumption of products from the warehouse.

Safety Management

A safety management system will manage the health and safety of the employees in the warehouse, describing who is responsible for which areas and the safety measures that are required in certain situations.

Cost Management

A cost management system will help a company to control the costs involved and to locate faults in the financial system that may be caused by inaccurate records.

Order Management

A warehouse management system must be able to show the orders that have been placed and will put them in a queue for picking and shipping.

It is up to the system to make sure that all of the necessary procedures are followed so that the process can flow smoothly.

It is the management system’s responsibility to let everyone know what is going on at any time of the process, when there is a delay in an order or if there is a problem with one.

The warehouse management system is also a very important factor during a power failure because it does not release its data due to the failure.

Integration Management

Integration management is the organization of all of the individual warehouse management system processes in order to function effectively together.

System Management

System management is the system that manages all of the information within the warehouse management system; basically, a system that monitors and controls the activity associated with the warehouse.

What are the benefits of you having a WMS?

There are a number of benefits to using a warehouse management system. Some of the major ones are:

  • Measures performance
  • Controls the accurate flow of goods
  • Manages inventory levels
  • Stores important data of all products in the warehouse

Key Features of WMS

There are some key features of WMS and these include:

It allows uploading and downloading of data

A warehouse management system allows an organization to exchange and share data and information with other organizations as well.

A wider view of the warehouse

WMS allows an organization to understand a better warehouse activity that is going on.

Embedded TMS

This allows a warehouse to easily communicate with other organizations through the integration of various inventories and systems.

It is a good tool of planning, analysis, control and communication.

The WMS is designed to be integrated and comprise, which ensures that all operations in the warehouse are well managed.

A WMS is goal oriented

It is oriented in the way it is presented and functions to help achieve specific goals.

It is based on customers

It is a tool that helps an organization to look at the products from the customers’ point of view.

It provides clear information

A warehouse management system provides clear, precise, timely and relevant information.

It gives access to the right kind of information

It helps to gather the right information that is important to the organization.

It allows collaboration

Warehouse management system allows optimized collaboration.

It allows flexibility

A warehouse management system is a flexible system that allows an organization to expand its business to other countries.

A WMS gives a better understanding of operations

It helps understand the operations of the business more comprehensively.

It enhances efficiency

It enhances efficiency by allowing customers to access a range of products at an affordable price.

It helps to meet the challenges of management

The systems ensure that the needs of the customers are met by ensuring the existence of efficient level of service. There are many difference places that are using Warehouse Management Software.

What Factors should be considered in choosing a warehouse management System?

When an organization is looking to use a warehouse management system or is choosing a new one they should consider some factors. These include:

The level of expertise in the staff members of the organization

If staff members are not well trained they might be unable to use a warehouse management system to its full extent.

The level of demand

If there is a high demand of products in an organization the management will have to choose a system that will cater for that demand.

The amount of information they will have to store

If an organization has a large number of transactions they will have use a warehouse management system that will be able to handle that.

What suppliers want to know from you

If you are supplying good to any organization seriously consider the following:

What is the purpose of your business?

The purpose of your business is important when it comes to a warehouse management system because it determines how you will handle your business.

What is the history of your business?

The history of the business is used to create the blueprint of your warehouse management system, therefore the experienced users will be able to make a better choice.

What are the future plans of the business?

Future goals and expansion will determine how the warehouse management system should be in the future.

What is your experience in handling your activities?

This will help you to improve your organization.

What you want to achieve?

This question helps you to organize the targets and goals that you want to achieve with the warehouse management system.

What are the Products and Services you will offer to your customers?

This will help you to set up an effective system that will benefit the organization.

Tips for setting up a WMS for a small warehouse

What are the Skills and Resources available in your organization?

This will help you to have a WMS that suits your level.

What short term and long term goals will the WMS help you to achieve?

It is very important to break down the goals so that you can see how it will be beneficial to your organization.

Other Questions you need to ask yourself when choosing a system

An organization should ask themselves the following questions when choosing a WMS:

What do you want to achieve?

What are you going to do with the money you will use in running the warehouse management system? Your financial goals will determine how you will budget.

When should you choose a warehouse management system?

You should consider using a warehouse management system when it is appropriate because the resources you will put in it will determine how effective the system will be.

Who should run the warehouse management system?

You should consider the users of the system when it comes to running the system because there should be no bottlenecks of information or orders.

How will the user know about the system?

The users should know how to use the system before they can use it. Therefore, training is very important before an organization can use a system.

Is timely information part of your requirements?

If you want to run an effective system then information will play a huge role

What kind of organization do you want to represent?

The image of the organization should also be a consideration in the choice of a warehouse management system.

What are the future needs of your organization?

The needs of an organization are very important when it comes to warehouse management.

How can you improve on the level of performance of your organization?

You should evaluate how well the current management system is performing before looking at other things because it will help you to identify what the problem is.

Why choose a Warehouse Management System?

Warehouse management is important for an organization especially if it wants to expand its business because it will help you to monitor the activities in the warehouse, therefore you will minimize the chances of losing your goods.

Tips for setting up a WMS for a small warehouse

Setting up a warehouse management system can be a very difficult task for any person or organization. An organization should consider some factors before setting up a warehouse management system.

What is the purpose of your business?

This will help you to determine how you will organize your warehouse management system.

What is the history of your business?

It will help you to set up your future goals in the warehouse.

What are the future plans of the business?

This will help you to make proper plans when do decide to set up a system.

What is your experience in handling your activities?

You should be very familiar with the activities that are carried out in your business, therefore, you will be able to determine the best way to set up a warehouse management system.

What you want to achieve?

This will determine your goals and objectives you need to work towards.

What are the Products and Services you will offer to your customers?

This will help you to decide what products and services you will include in your warehouse management system.

What are the future needs of your organization?

This will help you to determine what products should be sold in the future.

How can you improve on the level of performance of your organization?

This will help you to improve on what can be improved in the organization.

By answering the previous questions you can determine the best way to set up your warehouse management system. This will help you to plan your activities and have the right system to run and manage your organization.

Case Study

Within the next five years the company wanted to grow its business by increasing the number of business transactions it conducts each year. The company aimed to expand and cover more products and services. As a result the company had to develop more warehouses in order to cover more locations throughout the country, therefore, the warehouse management system had to be able to handle any business.

How to Design a Warehouse Management System for a Specific Industry

In our life there is something that we don’t notice so much until we are missing it. It happens only when we know how important it is to our life. Same is the case with the warehouse management system. A good warehouse management system must be designed in such a way that it manages your business in the most effective way. The main purpose of a warehouse management system is to help you in increasing your business and you will be able to do that only if you have a good system in place.

What are the things that should be considered when designing a warehouse management system?

Well, the answer depends on the specific industry you are working in.

  • For what purpose are you going to use the system?
  • What are the targets you want to achieve?
  • How you are going to use the information in your product management system?
  • What type of information will be used in the system?

Consider your business and the people who are involved in it

The type of information you will include in the system should be determined by the people involved in the activity and its purpose.

What target are you going to achieve?

This will explain how the system should be designed.

Tip 1: When it comes to design make sure you have clear ideas about what you want to achieve because it will help you to determine how you will take your business to next level.

Tip 2: Before designing the process, you should consider the financial flow and the time involved because it will help you to determine how much the system will cost.

Tip 3: The initial decision makers should be very important when setting up the system because they will help the whole process to work.

Case Study

The new warehouse management system was developed to support the growth and increased production activities. It had to be developed considering the typical daily work that was done in the warehouses. The system was designed with a common vision to increase customer satisfaction, increase sales and profit, and improve productivity. Most of the warehouses are situated in the provincial capitals and in urban cities where the population is increasing.

Warehouse Management System Case Studies

Following are a few case studies of Warehouse Management System that you can use to improve your health and safety performance and ultimately to save lives.

Honeywell – Warehouse Management System Case Study

The company was employing more than 3500 people across the globe. The total number of employees was more than 500 in one of the locations across the world. The company had to invest heavily when it came to training employees, therefore, the management decided to look for a warehouse management system that would be able to help them to train their employees.

What was the purpose?

For each subsidiary the warehouse management system was customized so that the employees become more efficient and productive so that they can increase the overall productivity.

Most of the locations had a warehouse in the rural area and therefore it was very important to train the employees about health and safety matters.

What was the training plan?

Development and implementation of a training program were some of the things that managers considered when it came to the training plan in order to reduce the hazards and incidents in the warehouse.

The training program was customized according to the type of hazards that existed in the workplace.

It was divided into different modules that dealt with different areas of health and safety.

What was their purpose?

The purpose of the program

Training the employees on the different types of hazards in the warehouse

Give the employees information about how they can prevent accidents and ensure greater safety

The purpose of the modules

The modules were created in such a way that they may be completed at different time so that the employees could complete the sessions during the day.

They were divided according to the importance.

How did it change company’s operations?

The training program proved to be very useful when you asked the employees about the impacts it had on them. They were able to secure different components of the program. It improved the overall health and safety of the company’s operation.

Guide to WMS for Small Businesses

Guide to WMS Systems for Small Warehouses