Netherlands flower warehouse
A flower warehouse in The Netherlands
Efficiency is crucial in warehouses and supply chains, especially in a retail climate thriving on instant gratification. Distribution and logistics companies relying on outdated technology — such as paper inventories and manual counts — are at a disadvantage. How can implementing a warehouse management system (WMS) help your supply chain become more efficient while cutting costs?
What Is a WMS?
If you're not familiar with the terminology, what is a warehouse management system?
As its name suggests, a WMS is a software system that allows supervisors and business owners to see a birds-eye view of their business, including everything from inventory movement to sales trends. It can keep track of a single item from the moment it enters the warehouse until the moment it leaves.
Setting up a WMS can be simple, and once it's in place, it may change how you look at warehouse management forever. How can this system improve your supply chain?
Improved Inventory Management
Traditionally, inventory management strategies relied on manual counts and paperwork to keep track of the items coming in and going out of the warehouse. While this sufficed in the past, it is not enough to keep up with the ever-increasing pace of the logistics and distribution industry.
When paired with RFID or Bluetooth markers, a WMS can keep real-time track of everything in the warehouse. This increases efficiency over time, especially if you rely on manual picking and packaging because you don't have to wonder where something is or how many of an item you have on hand when an order comes in. A well-designed WMS can also track historical information to predict future needs which helps optimise your customer service.
Fewer Mistakes and Inventory Loss
Inventory loss and shipping mistakes don't just impact warehouse efficiency — they can also cost you a lot of money. According to industry experts, the rate of inventory shrinkage in Europe in 2017-2018 was 1.83 percent and cost the industry $29.05-billion (€26.17-billion).
While increased security can help prevent theft, you still have the problem of shipping errors or items that are damaged in the warehouse. Warehouse management programs improve inventory efficiency and help to reduce both shipping mistakes and damage.
Increased Workflow Efficiency
Improving inventory management and reducing mistakes and loss don't just help you save money — they also help to increase workflow efficiency. While Amazon has the money to purchase robots to pick orders in its warehouses and distribution centers, most companies don't have the capital to justify that sort of investment and as such rely on human workers to pick, pack and ship their orders.
A warehouse management system that relies on inventory tracking can help reduce unnecessary movement — for both the inventory and the employees — and can help or even eliminate some manual processes. Over time, this can help improve the efficiency of your workflow and help you keep up with orders and work as efficiently as possible.
Cutting Costs
All of the things listed have one thing in common — they can all help your facility save money. Inventory management prevents a loss that could number in the billions of dollars, depending on the value of your inventory. Improving efficiency by reducing wasted time and movement saves you money in the form of working hours. All of these improvements and more can be accomplished by implementing a state-of-the-art warehouse management system.
Adding a WMS to Your Facility
If you haven't introduced a warehouse management system into your facility yet, now is the time to make that change. A cloud-based WMS is a user-friendly option that can help increase supply chain efficiency, cut costs by reducing waste, and making your job and the responsibilities of your employees more comfortable.
The author, Megan Nichols is a freelance blogger and writer.
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