Warehouse Management

What is Warehouse Management?

What is Warehouse Management?

Warehouse Management Helps You:

  • Organize warehouse space
  • Manage inventory
  • Make transportation management easier
  • Improve warehouse performance
  • Apply better warehousing logistics

Organize warehouse space

What is warehouse management, and how can a software system optimize your warehousing? Firstly, organization in the warehouse is key to the fluid movement of product and employee travel. Warehouse management software can help guide warehouse managers by setting up a viable product floor that still has room for employees to complete picking rapidly.

By leveraging data provided by the management system, products that historically sell better can be set up near the packing floor while slower products can be placed further away.

Warehouse management usually come with various methods of labeling and tagging products to expedite the picking process. RFID tagging and even pick-to-light are on the rise because they increase pick accuracy and cut down on the time spent looking for a product. There are many other features included in most WMS solutions that can tip the organizational scales in your favor:

  • RFID tagging
  • Mobile barcode scanning
  • Pick-to-light/Voice-picking
  • Product tracking
  • Multi-warehouse support

Manage inventory

Inventory management is a vital part of running a successful warehouse. The efficiency at which a warehouse runs is reliant upon the speed and accuracy of product moving from the warehouse to the packing and distribution areas. In order to accomplish this, many warehouses adopt separate inventory management systems, but can a warehouse management system do the same job?

Long story short, yes, a WMS can take care of inventory management if it includes all the necessary features. This depends, however, on the size of your warehousing operation. Inventory management systems are generally smaller and cannot handle huge amounts of product and complexity. Meanwhile, a WMS is built to handle all of the processes that run in a warehouse as well as large volumes of product. Depending on your unique requirements, a WMS can stand in for an inventory management system, but keep track of some important features they should both have:

  • Order management
  • Multichannel sales
  • Stock takes
  • Goods issue
  • Receipt control

Make transportation management easier

While transportation management is generally accepted as its own little ecosystem in the larger world of supply chain management, a WMS solution can make it run smoothly. Organization is the name of the game when it comes to optimizing transportation management, and organization begins in the warehouse. By adopting a WMS, warehouses can keep track of exactly how much product they have available and what has to be moved out. This way, warehouse managers can see how many trucks need to be available to move the required products for the day.

Labor management features are also important when it comes to planning out the distribution of products. By keeping track of how much labor is available on a given day, warehouse managers can plan accordingly. If only a small team is available, receipt of a large batch of new products can be scheduled for a later date when more employees are available. There are some other WMS features that can make transportation management even easier:

  • Labor management
  • Packing management
  • Shipping support
  • Cross docking

Improve warehouse performance

When it comes to warehouse performance, the accuracy and speed at which a customer’s order is fulfilled are the major indicators of a successful operation. By implementing a WMS that fulfills your requirements, warehouse managers can keep track of some vital KPIs that keep a warehouse running at maximum efficiency:

  • The efficiency of product reception
  • The rate of product return
  • Picking and packing accuracy
  • Average order processing time

A WMS provides valuable visibility into day-to-day warehousing practices while gathering helpful data that managers can use to plan for the future. Data visibility can show where a warehouse is slipping up and how managers can act before a problem arises. By leveraging this data, the important KPIs that define a functioning warehouse can stay optimized.

Apply better warehousing logistics

Logistics is a buzzword in the world of supply chain management today. When considering the entirety of a supply chain, logistics are important at every step. From manufacturing to the final delivery of a completed product, different management systems help put strong logistics practices into use to optimize different legs of the chain.

When it comes to warehousing logistics, a WMS is absolutely critical. As soon as a product is received, warehousing logistics dictate how quickly it moves from reception to storage and eventually out for distribution. In order to achieve maximum fulfillment expediency, warehousing logistics need to be fine tuned through the usage of the aforementioned data visibility these WMS systems provide.


Who Uses a WMS?

As we touched on earlier, warehouse managers oversee the warehouse management process. Therefore, it shouldn’t come as a surprise that they’re the primary users of a warehouse management system. That said, however, they’re by no means the only ones who benefit from using it. Thanks to the labor management features found in most warehouse management systems, warehouse employees benefit from using WMS solutions as well. They can use it to view the orders that need to be processed and, more importantly, they can also view their schedule so they know what tasks they have to complete each day.

What Are the Biggest Benefits of Using a WMS?

There’s a good reason for the rise in popularity of WMS platforms in the last several years. The many benefits that they convey to warehousing businesses are hard to ignore. Some of the standout benefits of using a WMS include reduced operating expenses, continuous process optimization, enhanced security and improved customer and supplier relationships.

Other benefits that companies commonly gain from using a WMS include maximizing their labor resources, simplifying just-in-time inventory, enhancing demand planning and increasing transparency to both employees and suppliers. These systems streamline and optimize nearly every critical aspect of running a successful warehousing operation.

Introducing automation tech can take things a step further. Robotics, machine learning and AI are becoming more commonplace in warehouses across the world. If you’re looking to boost efficiency, cut down on errors and ship products out faster then automation is the way to go.

What Are the Most Common WMS Integrations?

In order to make the most out of your WMS, integration is important. There are three types of warehouse management systems: standalone, ERP modules and SCM modules.

ERP integration centralizes all of your systems so that you can work with all of your data in one location. This creates less manual data entry as well as more data security. SCM integration does much of the same, except that instead of centralizing all of your software, it does so for all of your supply chain-related systems.

Transportation management system (TMS) integration is also common. TMS integration allows for easier and automated organization of your distribution processes. The two systems work together to create a cohesive, fluid distribution system that ensures accurate and prompt product delivery.

Finally, we come to an integration that’s not obvious at first, but nonetheless useful: CRM. CRM integration gives you more data with which to create a 360-degree view of your customers and their experiences. Rather than merely viewing their interactions with your marketing and sales materials, you can track their orders as well. Not only can you track what they ordered, but what happened with those orders.

How Does Warehouse Management Affect Supply Chain Management?

Warehouse management is a central link in the supply chain management lifecycle. It’s the all-important bridge between producing a product and delivering it to customers. Warehouse management helps organize goods to make sure that they’re shipped to the right customer at the right time. Getting things picked, packed and shipped out accurately and on time is a warehouse’s most significant effect on the supply chain.

If your warehouse management processes become inefficient and inaccurate, it can derail your entire operation. Sending products to the wrong location or sending the right products late can damage your reputation among clients. When your customers get what they want when they want it, there is a higher chance they’ll become return customers.

What Does Logistics Mean in Warehouse Management?

You’ve certainly heard the word “logistics” before, but what does it mean when it comes to warehouse management? In short, logistics is an umbrella term for the various tasks related to transportation, warehousing, inventory, information management and more. These include the various processes in the supply chain that happen before, during and after warehousing.

It’s crucial that the different functions of logistics work in tandem so that your supply chain is as efficient as possible. A practical example of this would be when initial reception of goods is scheduled so that they arrive at the warehouse when there’s room for the inventory. Additionally, it means that those goods leave the warehouse on time, so they arrive at their destination exactly when they need to be there.

What is the Meaning of Inbound and Outbound Logistics?

Inbound and outbound logistics are, as the names suggest, the opposite of each other. As we explained above, logistics involves the processes directly related to warehousing before, during and after products arrive or are shipped. Inbound logistics, therefore, are the processes involved with incoming goods. Outbound logistics, on the other hand, deal with distributing goods.

Inbound logistics deal mostly with receiving and storing goods when they arrive at the warehouse. Every step of the process  from a shipment arriving by truck (or other transportation) to the storage of the goods is a part of inbound logistics. A crucial component of inbound logistics is recording information related to storing the goods, so they can be found easily when it’s time to move them out of the warehouse.

Outbound logistics involves all of the processes that ship goods out of the warehouse, including order fulfillment. This includes collecting various items together, loading them onto a truck (or other transportation) and sending them to their destination (most likely the customer).

What is the Difference Between Warehouse Management and Inventory Management?

There’s a good amount of crossover between WMS solutions and inventory management systems. This has created some confusion on what the differences are between the two. WMS solutions are more robust, handling all of the warehousing features in addition to inventory. Inventory management systems are generally cheaper than WMS, including being more “lightweight” systems. Inventory management systems tend to solely focus on tasks and processes involved in organizing and streamlining product storage.

When it comes down to inventory features, there are even more noticeable differences. Inventory management systems can only handle a limited number of products whereas WMS solutions are built to process a high volume and wide variety of goods. So a warehouse that works with fewer products may be just fine using an inventory management system, but one that works with a diverse set of products would need a WMS.

Can You Use a WMS for Inventory Control?

Thanks to its powerful inventory management features, a WMS is a great tool for inventory control. One of the capabilities that makes it so useful is the ability to differentiate between pack sizes. By pack sizes, we’re referring to pallets, cases and individual items. A WMS identifies whether each unit is a pallet, a case or an item, based on each unit’s identifying barcode/SKU/serial number. This makes planning for inventory storage much easier. For example, you’ll never be caught off guard thinking that you’ll place a unit of 100 items in a corner, when in fact that unit turns out to be 100 cases.

What is Putaway?

Putaway (or put-away, depending on who you ask) is probably the most self-explanatory process in warehouse management. It refers to literally putting away all of your incoming stock. The putaway process is a part of inbound logistics that covers the tasks related to receiving inventory, through to stocking it. A WMS is immensely useful for effective putaway. Many WMS solutions help with planning where to store stock, and can assign locations for storing it.

How Does Warehouse Management Help with Transportation Management?

The main benefit that WMS tools provides transportation management is organization. As you know, inventory gets organized within a warehouse so that all of the products that leave together are stocked together. In turn, this helps plan for what kind of transportation is needed, as well as how frequently it’s needed to deliver products on time.

First and foremost, warehouse management helps track how much stock is stored in each warehouse. With this information in hand, you have a good picture of how many trucks you need to allocate to each warehouse. For example, let’s say that Warehouse A has 100 pallets of a certain product, while Warehouse B has only 80 cases of it. In this case, you know that you need to allocate four 53” trailers to Warehouse A, while you only need to send a small truck to deliver the products from Warehouse B (if it’s not part of a bigger order).

In addition, knowing how much labor you have available at each warehouse helps schedule more efficient shipments. If you have a day where most of your labor is tied up delivering several small shipments, it’s probably not a good day to receive a large shipment. In this case, you can organize your shipment dates to make the most of your available labor. For example, you can alternate shipment dates so that you manage several small shipments on some days, and a few larger ones on the other days.

How Do I Select a Warehouse Management System?

Tracking down the perfect warehouse management system can be a daunting task if you go in blindly. Take some time to think about the unique requirements of your operation. Is there money in the budget to cover a brand new system? How large is your warehousing operation and do you require a complex solution or something more simple? By laying out a list of what you need, you can narrow the expansive field of vendors down into something more manageable. If you want some more help or just a bit of guidance, you can visit our Warehouse Management Requirements Checklist or our guide on creating a WMS RFP.

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Warehouse management articles are written and edited by:

Hunter Lowe

Team Lead Editor and Market Analyst

Hunter Lowe is a Team Lead Editor and Market Analyst at SelectHub. He writes content for Construction, Inventory, Warehouse, and Supply Chain Management.

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