Upgrading Inventory Management With a Warehouse Management System
The key to a successful company is an effectively managed warehouse, but this puts many warehouse managers in a tough position. There are so many factors in a warehouse that can cause unforeseen problems and affect how smoothly your warehouse operates.
As a company builds its multichannel distribution network, tracking shipments and products in your warehouse becomes more challenging to manage. You can't just get by knowing how many units you have at a specific warehouse; you need to know where exactly in that warehouse your inventory located. This information includes the stock location, shelf, bin numbers, and the order the unit is assigned to. If a bin runs out of inventory, you then need to know where your bulk stock is sitting so you can replenish the container. This is a lot of information to retain or manage manually, especially if you are managing multiple warehouses.
You need to track your units at a deeper, more granular level of information to keep your inventory operations running efficiently. While an inventory management system helps you track your units, warehouse management systems (WMS) provide the stock control to keep your warehouse organized. Combined, they offer a unified inventory management solution that maintains the integrity of your data and keeps your products secure.
Although integrated inventory and warehouse management systems can provide many benefits, 43% of small business owners still use manual methods to track inventory levels.
In this article, we take a look at why you should use a warehouse management system to improve the efficiency of your warehouse facilities. We’ll be looking at how a WMS can improve your warehousing operations and why it should integrate it with your inventory management systems.
How Do Warehouse Inventory Management Systems Work?
There are several tasks that warehouse management systems fulfill, including:
- Labor management: a WMS allows you to track real-time data about each warehouse employee, including which orders they are handling and which products they are picking. This feature helps you closely monitor employee performance.
- Pick Efficiency: A WMS can manage the process of determining the best sequence to pick items for orders. Getting this right can increase fulfillment speed and accuracy.
- Shipping and receiving: Shipping and receiving are at the forefront of any comprehensive warehouse management solution. It should help cut down the time spent on order fulfillment and receiving inventory while minimizing losses.
- Inventory tracking per location: Warehouse management systems divide warehouses into many bins and compartments. It allows companies to view real-time inventory data on specific warehouse locations. If you are managing multiple warehouses, the WMS should also provide a holistic view across all of your facilities.
Warehouse management systems typically come with physical equipment for the warehouse, including computer software, barcode scanning equipment, packing slip printers, and label printers. Together these tools help you track products and speed up your logistics operation while optimizing accuracy when picking. These all help your team – from the warehouse staff to the ecommerce managers – know what goods are available in the warehouse at any time.
One main feature of a warehouse management system is tracking where products are located within a warehouse and distribute them to different parts of the warehouse. Most warehouses will include a receiving location, where pallets of products are held, and the pick locations, where staff can pick items for shipments. Managing the inventory flow between these locations is important because it dictates how quickly orders ship out of your warehouse. WMS systems allow warehouse managers to keep tabs on these stock levels and inventory constantly flowing between these locations.
WMS systems also improve picking time by organizing how employees pick items, optimizing the picking order so they only need to visit each location once.
The Benefits of Integrating your Warehouse Management System and Inventory Management System
Your inventory management systems and warehouse management systems must have the capability to integrate. Integrating your IMS with a WMS ensures inventory data accurately flows between your sales channels and your warehouse operations.
Below is a list of benefits that further demonstrate how integrating your two systems makes the entire supply chain work better.
Effective Management Control
Warehouse management solutions are able to offer warnings of stock control issues so that you never run the risk of being low on stock. It also keeps close track of inventory changes at the stock location level, allowing you to reference any previous adjustments.
It also allows for quicker updates to your inventory management system. Instead of manually updating locked or damaged inventory in the software, you can simply scan the items to update their status. The inventory management system then updates your sales channels, preventing additional orders from processing.
A warehouse management system also allows warehouse staff to find inventory using the scanner instead of needing to go back to their computer stations.
Reduced Equipment Usage and Related Overheads
A good warehouse management system will determine the best and most efficient way for you to get the most out of your warehouse and staff. It highlights which materials, equipment, and products to retain and which to discard.
In short, you get to configure your warehouse so that it’s running at peak efficiency for improved picking time, saving you time and space. The system can also prevent unnecessary use of materials handling equipment, which can reduce wear and tear on expensive equipment.
It Eliminates Human Error
Warehouse management errors can lead to a loss of profits and inventory. Human error is the top issue among 46% of warehouses. Unfortunately, given the nature of warehouses – the stress of picking items, noisy environments, and general physical fatigue – these errors quickly become commonplace. Errors happen more often if warehouse management is handled manually.
There are multiple ways a warehouse management system can mitigate human error. Using barcodes and scanners helps facilitate data entry and accuracy. Moreover, these scanners help you to keep track of stock, which also eliminates human error. As noted before, any changes made on the floor are instantly captured in your inventory management system, further automating updates to your sales channels.
Misplaced inventory can also slow a warehouse down. Your team is left blindly searching for it, and your processes are slowed down. By using tracking software, each item is assigned a barcode that makes it easy to locate an item, no matter how often it's moved around in the warehouse.
Studies have shown that when you use inventory picking systems instead of paper-and-pencil, you can see an average 25% increase in overall productivity.
Barcode labeling can also help with errors. Sometimes, pickers can make mistakes and pick the wrong item or wrong quantity of a product. If this happens with a barcode scanner, the scanner will create an error message with every incorrect pick. The scanner alerts them to their mistakes and prevents the wrong items from being despatched.
Getting more control of your inventory and reducing human error helps to limit stock-outs and write-offs, reducing the time used to reconcile lost units.
Better Demand Planning
Warehouse management software and inventory management software both have demand planning capabilities. Accurate demand planning requires that you combine data on incoming and outgoing products. The data inform your forecast so you can order the number of units needed to handle future orders. Order flow and fulfillment should run uninterrupted, and marrying the data between the systems provides a clearer idea of which stock requires immediate attention before you sell out.
Higher Levels of Security
When you use warehouse management software, employees are assigned individual, auditable user accounts that make it so much easier to track changes, performances, and deviations.
Employees are asked to use individual accounts on most of the top warehouse management systems available. Using individual accounts guarantees an audit trail that links specific transactions to each employee. Providing each user with an account instills accountability and enhances security by allowing you to control how much access employees have.
QuickShip For Skubana
Picking the right combination of software is key to an efficient operations structure. Because inventory management systems and warehouse management systems are both involved in fulfillment and inventory tracking, they must communicate effectively.
Skubana has established integrations with several warehouse management partners to help combine the inventory management and automation capabilities with the control and efficiency of barcoding software.
One of the most recently released features is our QuickShip integration through our partner, Barcoders. The QuickShip feature allows users to print packing slips and shipping labels without the use of a keyboard, minimizing the time needed to ship out an order. Shipping is handled with a barcode scanner and a printed sheet of pre-defined barcodes that automate each action within Skubana.
The QuickShip feature reduces the amount of equipment needed at the workstation and minimizes interruptions to fulfillment workflows, improving your warehouse’s shipping efficiency.
Using QuickShip with Skubana and Barcoders only takes a few steps. Once Barcoders has been installed and the QuickShip feature enabled, you can do the following:
- Open Skubana on your computer and run QuickShip from Barcoders
- Set your order on a USB scale and open the order page on your computer
- Scan the search bar code
- Scan the order number from your picklist
- Scan the “read scale” barcode
- Apply the presets to set the dimensions and shipping method
- Scan the ship and print the barcode. The order will ship out from Skubana and send your label to print.
- Take the barcode and shipping label from the printer and stick it on your package, which is now ready to ship
The process is also outlined in the following video from our partners at Barcoders.
Implementing a Warehouse Management System
To effectively implement a warehouse management system, there are some key factors you need to consider. These include:
Choosing the Right Warehouse Management Software
When it comes to picking the right warehouse management system, it's important to choose one that meets the needs of your warehouse operations. It has to fit into your current business culture and model, and it needs to have the kind of functions and innovations that will allow your company to grow.
And since WMS providers have a wide range of systems available, you need to prioritize the necessary features such as picking, tracking, and shipping. This will help you decide which WMS is right for your warehouse.
We recommend asking yourself the following questions before making your final decision:
- How many users will we need today?
- How large are we expecting to grow? How many users will we need in the next few years?
- Do we use barcoding now? Does the system help us with developing the necessary barcodes?
- What mobile hardware do we currently use? What would we like to start using?
- What process do we use in our pick, pack, and ship process? What do we want to keep and what do we want to improve on?
- How easily can our inventory management system be integrated into a WMS?
Learning and Training
If you weren't using a warehouse management system before, the transition period might be difficult for your staff. A WMS adds new equipment that they will need to become familiar with quickly. Your employees should be fully trained to maximize the benefits of the new warehouse management system.
You will also need to build your WMS implementation team who can teach your warehouse employees how to use the system. This is ideal if the WMS you select has a team that can facilitate this training for you. Remember, your team will dictate how successful the new software will perform for you, so do not skip this step.
Embracing the Culture of Change
It's often the case that team members are resistant to change at first. It's not always easy to convince them to get on board with a new piece of technology. Communicate the benefits of the latest software, as well as the changes you've got planned for improving the warehouse.
Make sure to also include them in the decision process by gathering their feedback. Employees will be more open to change if they feel like they are a part of the selection process.
Evaluating your WMS implementation
Never forget to evaluate the implementation of your WMS and the integration with your inventory management systems. Your implementation process will dictate a lot of the success you will see post-implementation. It is good to re-evaluate your decisions three months after implementation so you can make adjustments before the team becomes heavily ingrained in any processes.
- Are you on track with initial your budget and plan? How are the warehouse staff handing the new system?
- Where is the team experiencing friction when using the software? How can you improve this process?
- Do your WMS and IMS integrate correctly? What errors are you running into that need to be addressed?
- How has your warehouse performance improved? What impact has the implementation had on the number of orders fulfilled, inventory movements, picking time, etc.
If you are expanding your fulfillment network and planning to include an in-house warehouse, you will need to consider which warehouse management system to implement. Make you keep your goals central to the decision you make and think about the additional tools you will need to integrate into the system. Your warehouse management system should integrate with your inventory management system and provide automation features to minimize interruptions and improve warehouse efficiency.