Commentary | IT Matters

Two Key Factors Drive WMS Adoption Today

Tags: Logistics I.T., Warehousing, Warehouse Management Systems (WMS), Distribution, E-commerce, Technology

Eric Allais is President and CEO, PathGuide Technologies, Inc., 888-627-9797

Do you need your distribution or warehouse sector to be faster and leaner?

If so, the warehouse management system (WMS) has emerged as a valuable tool that can be used to track and streamline tasks, the workforce, and material/equipment flows. In fact, the ARC Advisory Group’s WMS Global Market Research Study showed the WMS industry to be worth more than $1.5 billion annually.

To help illustrate why this technology is facilitating an industry-wide transformation, here are two customer stories that identify key factors driving WMS adoption today.

A Hyper-Competitive Distribution Market

Manufacturers are often at a distance from customers and suppliers, causing considerable transportation and logistics complexities. Additionally, many still rely on labor-intensive processes to manage their operations. In some cases, shipping and inventory data is input manually, leading to potentially costly errors, higher manpower expenses, and wasted time.

A well-managed WMS can drive efficiencies from receiving to picking and ensure more timely and accurate customer shipments. Managers can either rely on helicopter-level overviews or granular insight into the entire workflow to pinpoint process bottlenecks and measure transaction throughput.

Florida-based HUB Industrial Supply is an example of one company that adopted a WMS to overcome logistics issues and to help maintain growth.

“We had carved out a unique position versus larger suppliers by building our strategy on two key concepts: exceptional customer service and just-in-time delivery,” explains Alex Kirsch, HUB’s vice president of technology. “However, as we grew, we realized we were drowning in paperwork that was keeping us from properly defining and quantifying problem areas.

“After deploying our WMS we noticed almost immediately that efficiency and accuracy had improved, while the put-away and picking processes were much more streamlined. The system’s built-in metrics also helped us establish a more realistic and manageable level of employee accountability.”

Explosive Growth of E-Commerce Fulfillment

Another factor driving the adoption of WMS is the growing trend for retailers to offload e-commerce fulfillment onto distribution partners.

Many DCs and warehouses that traditionally focused on stock replenishment are expanding into direct-to-consumer, requiring their operations to restructure to embrace single-order, single-line item shipments. The increased volume of single-item orders has pushed them to introduce software tools to help satisfy demand while maintaining profitability.

Iowa-based Lorenz & Jones is an example of a distributor that adopted a WMS to support its burgeoning e-commerce business.

“E-fulfillment used to be a pain point for us,” says Tom Lorenz, vice president. “To be an e-commerce supplier, we needed the kind of technology that lets us fill orders quickly, accurately, and anonymously. When we ship orders on behalf of our clients, the products go straight from us to the customer. We strive to be anonymous in the transaction because we want the consumer to assume the product came from the retailer’s own warehouse.”

Lorenz & Jones further hides involvement of a third-party fulfillment partner by printing the retailers’ logo and name on the packing slips and labels.

“Without a WMS, there’s no way that we could have been in e-fulfillment,” says Lorenz. “You have to have a kind of speed and accuracy that’s just not possible in a manual paper-based warehouse. Our WMS automatically sends shipment information back to the retailer. Web retailers can then send tracking information to their customers, and everyone is kept in the loop.”

Final Results

Many warehouse distribution center operators hesitate to implement a WMS out of fear that the deployment process will disrupt their day-to-day businesses. The truth is, an experienced WMS implementation team will study the individual needs of the business and have a plan to deploy a new system with minimal impact to daily operations. The result? Better organization, a more integrated and efficient workforce, and streamlining of warehouse space and processes that enable the business to ship and deliver every order on time—no matter how big or small.






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