07 August 2017

How to drive growth and value with a warehouse management system  

It’s no surprise that a high proportion of retailers recognise the importance of effective warehouse management. In today’s digital world, this management requirement often leads to investment in technology and warehouse management systems (WMS).   When examining the role of technology in handling warehouse management and supporting growth, a survey from Internet Retailing discovered that almost 60% of retailers are using an in-house warehouse management system (WMS). What’s more, almost half rate WMS as nine out of 10 in terms of importance to their business success.  

At a basic level, the benefits of implementing or upgrading an existing WMS include:  

Insight: Ensure items at low stock levels are staged and put away first, reducing the impact of out-of-stocks and inefficient fulfilment processes.  

Storage: Know the location of all items within the warehouse. Route operatives to the right location, set up picks in the proper order to minimise travel time and increase the number of orders they can pick each day.  

Picking: Improve error proofing and productivity in the picking process. Workers receive picks on a rugged mobile device that routes them to the proper location. Scanning items verifies that the right item at the right quantity is picked.  

Packing: Ensure the accuracy of each order that is picked and reduce material costs by determining the right sized shipping carton.  

Dispatch: See that each order is properly packaged and shipped to the right destination and delivered on the right date.    

But many warehouses, with a WMS or not, still experience some key pain points, led by a fear of a loss of sales and reputation due to having warehouse management processes that are not fit for purpose.   Although an effective WMS is key to achieving many businesses goals, it’s often not placed as a priority. Budgets are also often diverted to more customer facing improvements, such as marketing for example.   Although this can result in an upturn in sales, it will also exacerbate any issues in the warehouse and lead to a struggle to keep up with demand. This can hurt customer service, and become a major roadblock to achieving long-term success.   Additionally, a quarter of retailers experience an increase of more than 50% in order volume during peak periods, such as Christmas. So how can we not only deal with intense pressure but also remain profitable?  

Poor systems and the resulting fulfilment issues need to be fixed as digital savvy customers have high expectations and are unlikely to return if their order is not carried out in a satisfactory manner on the first attempt.   This also includes the handling of returns and exchanges, so retailers need to ensure they can handle returns just as smoothly as other orders. It’s incredibly easy to return an item and then take your business elsewhere, so retailers need to do all they can to retain their customers by demonstrating a well-oiled returns system.  

The best online retailers have upped their game with many offering next day or even same day delivery, some even offer a choice of specific time slots. Orders are delivered correctly first time, every time, as any problems often lead to end users complaining on social media and potentially damaging the brand. Younger shoppers in particular have become more demanding in the digital age, with more convenience, longer hours, better loyalty schemes and easier delivery options high on their list of priorities. The latest WMS systems offer years of experience and refinement in tackling these issues and many others. What’s more, they are scalable for peak periods and overall business growth, and can also be tailored to provide each retailer with a personalised solution that works for their own warehouse environment and unique customer demands.  

A well-implemented WMS can be the platform for growth that many warehouse operators are looking for. It also helps businesses to create sustainable growth, rather than throwing resources at problems and running into issues at slower times of the year. Many businesses also find that a WMS system drives more efficient processes, meaning that they can often achieve much more without the need to hire additional staff (and invest in training for new staff) or move to larger locations. Technology today is helping businesses do more with less. Freeing up space not only means that retailers will have to pay for additional storage, but many are even offering excess warehouse space to other businesses. An effective WMS will empower managers to make the critical decisions to improve their business. Merging computer software, hardware and all peripheral equipment together will improve operations, assist with inventory management, help with control over the warehouse space, keep labour costs down and reduce losses. What’s more, one of the best reasons to make use of the latest technology is increased customer service. By allowing the business to better track, respond to and deliver goods to the end consumer a modern WMS will increase satisfaction and likelihood of repeat business, all of which will continue to drive future success.