Key Types of Warehouse Management Systems (WMS)

 

 

What Is Warehouse management software?

A warehouse management system (WMS) is a central source of information for everything in a manufacturing business. It contains your instructions for each order and shipment, as well as data from auditors. You can see all the data you and your employees collect aggregated into useful reports and automatically detect anomalies or issues that it would otherwise take someone with massive business knowledge to catch.

With the four main types of warehouse management systems, your organization will be able to keep inventory more organized, improve safety, and speed up operations, leaving your organization with more time to process orders.

 

Finding The Right WMS For You

There are many warehouse management systems, but they can broadly be classified into four system types:

1. Enterprise Resource Planning (ERP)

An Enterprise Resource Planning (ERP) software solution is great for any company looking to improve logistics or shipping issues. Often, small companies that are just beginning to scale will gain a lot of value from implementing a warehouse management system integrated with their ERP system. ERP systems help manage and integrate a company's financials, while WMS systems track inventory levels, locations, and order fulfillment. Although both systems are integral to supply chain management, they serve different roles.

An ERP system is designed to streamline and optimize business operations by creating a predefined path that orders and products must follow. On the other hand, a warehouse management system works to provide a comprehensive overview of the business by integrating with the warehouse and generating metrics and reports that show you how your performance stacks up.

2. Stand-Alone WMS System

A standalone warehouse management system (WMS) is the smallest and most affordable version of a WMS you could consider. They generally only offer integrations with a few other systems, compared to some of the other WMS solutions available on the market. This is a great stopgap solution for businesses that need to integrate two systems, like a successful supply chain management system.

Usually, a warehouse management system (WMS) is a software application that supports the day-to-day operations in a warehouse. A WMS is usually used to track inventory and manage warehouse space, but can also include features for managing labor, transportation, and compliance with safety and environmental regulations. businesses typically choose a stand-alone system to integrate with their existing supply chain management (SCM) system, where the SCM will pick up where a more comprehensive WMS would fit.

If your business is dealing with small batches or has a low employee flow, these systems might be a good choice because of how slim and simple they are. They're also easy to set up and use. However, if your business is growing, you might want to consider another solution that can accommodate your changing needs.

 

3. Cloud-Based Warehouse Management System

New technology has revolutionized the warehouse management market by providing businesses with the option to use cloud-based warehouse management systems. Cloud-based warehouse management systems offer a number of advantages that make them an attractive option for many warehouses, including the ability to scale quickly and easily, pay-as-you-go pricing models, and access to real-time data.

When you choose a cloud-based warehouse management system, you can rest assured that your system will be secure and always up-to-date. Cloud-based systems are handled by vetted and trusted companies like Amazon and Microsoft, so you don't have to worry about updates or software patches. Instead of putting the load on your IT staff, you can trust a cloud solution to help you quickly set up a warehouse management system. Cloud-based systems are also generally very affordable since they're typically based on usage and only require a small monthly payment.

If you're looking for an efficient way to scale your business, a cloud WMS solution could be a great option for you. With easy integration and top-of-the-line support from vendors, you'll be in a great position to handle increased demand.

4. Supply Chain Module

A supply chain module can provide a lot of benefits for businesses, including integration with a warehouse management system, shipping and scheduling capabilities, vendor management, customer service endpoints, inventory reports, and material handling management. In most cases, it makes more sense to implement a full warehouse management system, but sometimes a supply chain module will suffice - especially for 3PL providers that already have a warehouse management system in place but are missing the shipping and scheduling component.

 

Key Features Of Your Warehouse Management System

The features that make a warehouse management system more useful for certain businesses are its custom code, complex logistics, or minimal implementations. The appropriateness of each of these solutions for warehouse management depends on the specific business's needs.

Inventory Management

Inventory management software is critical for warehouse management but it's important to remember that it is just one part of a much larger system. Generally, inventory management software can't exist without some sort of warehouse management system (WMS) in place. Inventory management focuses on stock and order fulfillment while warehouse management systems encompass a much wider range of responsibilities such as managing finances, customers, and even employee safety. Because of the critical nature of inventory management, it is one of the most important features your WMS can accomplish.

A warehouse management system that includes an inventory management system may seem helpful or important for business growth, but it will ultimately limit your potential. If your business is growing or is mid- to large-sized, you would be better off with a full WMS, an SCM, or an ERP. These systems are more comprehensive and will allow your business to reach its full potential.

• 3PL (third-party logistics)

The nature of your business largely determines which WMS system is best for you. Larger companies, for example, need a robust WMS with full features, whereas a smaller organization might only need a simple inventory management system. 3PL, or third-party logistics, is another popular choice among businesses.

3PL (third-party logistics) is a company that provides shipping, distribution, and/or fulfillment services to other businesses. This type of company usually has the infrastructure to provide trucks and shipping management. They offer their services as a way for any company to outsource the expensive parts of every warehouse’s operation. By outsourcing shipping and logistics, companies can scale with their 3PL.

• Multiple Clients

A warehouse management system is 3PL company's best friend when it comes to inventory and purchase processing - especially for those with many clients. The ability to bill a variety of purchasers via the system is key for any warehouse that wants to stay organized and efficient. However, if your warehouse only has one client, this solution may not be necessary for you.

When you're shopping for a WMS, you might come across vendors who mention that their product is compatible with multiple clients. It's important to figure out if the vendor you're considering can actually support your specific multi-client needs. Sometimes, a cloud service will say that they're multiclient, but all this means is that they support several companies. Make sure that your vendor offers a true multi-client architecture, not just a server that's shared between different clients.

 

• Third-Party Logistics Billing

When you use a 3PL solution for your business, you can rest assured knowing that your shipments will be processed effectively and delivered on time. There are several advantages to using a 3PL, but it's important to be aware that you're outsourcing a critical part of your business to another company. In order to avoid any mix-ups with invoices and orders, you need to have a system in place that will integrate receiving, storage, and shipping with your third-party logistics provider. 3PL billing is a great way to do this, as it couples your system with your shipper's system to streamline the process.

• Value-Added Services

With a 3PL solution, you can be confident that your shipments will be efficient and on time. While there are several advantages to using a third-party logistics provider, you should be aware that you are outsourcing a critical part of your business. You need to make sure that there are no mix-ups when it comes to processing invoices and orders.

The best way to manage your inventory and shipping is by using a third-party logistics (3PL) feature in your warehouse management system (WMS). 3PL billing integrates receiving, storage, and shipping with your WMS so that your system is seamlessly connected with your shippers. This makes it easy to track and manage your inventory, shipments, and orders, so you can focus on other aspects of your business.

• Multi-channel Fulfillment Services

A multichannel fulfillment solution can be a great asset to your business if you have multiple warehouses or a global network. This solution can help you with order scheduling, bulk orders, order creation, and checkoffs - which is especially helpful if you're shipping between multiple business locations or have many B2B shipments.

Cloud systems are often used as a common solution for businesses, especially large tech companies which can take advantage of the various integrations to customize a solution that best fits their needs. This option also provides all the benefits of a cloud-based WMS system, which scales with your business growth and is a quick, cost-effective solution.