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As said by many experts I would say it depends only on the size of the organisation and the activity involved in day to day basis. In the present scenario all organisations uses some set of ERP system which clearly gives details of stock availability and requirements. WMS may help to reduce idle stocks. even we have an advanced WMS system it is upto the administrator how he/she gives the input into the system
In my view, Its not always the WMS saves cost in long run. It depends on your size of operations and needs. Need to evaluate the decision going for WM implementations or not is a big decision. Need to foresee the savings expected and compare the implementations and investment costs for implementing WMS. We can achieve efficiency/productivity, but not necessarily save costs. Its again an application which needs certain kind of customization while implementing it, its all add costs.
Implementing a Warehouse Management System (WMS) does benefit to minimize cost because with WMS we will have a wide control and track the transfer and storage of materials in your warehouse, The system can also identify numerous processes that are very important when shipping,receiving or in any inventory transaction in and outside of the supply chain functions, ensuring data transparency through out the business.
Anaysis the cost of material to Control in ( A-B-C ) Category. And reduce the inventory level (for example.)
a. Consumbale items must be control by our store issuance.
b. Reduce the man power and give additional work to the present workers.
c. The duration of time comsume by our workers must be completed in their duty hours. No extra / additional Overtime.
d. Control in mateiral handling. Utilized FIFO system.
e.. Planning and expedizing the material inbond / outbond. duration of time for off loading and loading. must be control by our storekeeper / supervisor by proper allocating the workers with equipments.
Warehouse management system can optimize your inventory in terms of storage and the amount of labor you use to keep your operations running
Warehouse operations can create mountains of paperwork very quickly, and manually reentering that information can cause even further slowdowns in your day-to-day processes
Labor and paperwork reduction, a WMS also helps to significantly boost accuracy of warehouse management. Automatic data entry can reduce human error due to mistakes, fatigue, or even fingers that just don’t seem to fit on our ever-decreasing screen sizes
Accuracy is a pretty amazing cost saver. It costs roughly $ to correct a shipping error and many in our industry see annual costs related to shipping errors reach as much as,$.
The benefits of Implementing a Warehouse Management System (WMS) :
WMS will reduce inventory!
Will reduce labor costs!
Will increase storage capacity!
Will increase customer service!
Will increase inventory accuracy!
Will control the expiry date of products if any!
Will increase operations speed!
Will control the movement of products in the warehouse!
Will control the stock!
and so much more.....
Why we have to implement the WMS?
1. Inventory accuracy.
2. Ageing stock.
3. Insurance
4. Procurement plan.
5. Demand Vs Supply.
6. Lead Time.
7. Minimize Dead Inventory & Carrying cost.
8. Traceblity of item.
9. Improve Operations
. Mass volume handling
. Huge no of Products /SKUS
. Stage wise tracking
. Proper movement & accountablity.
. Price changes if required adiquate / discounts -various price module & structures
. Global operations & Server control.
. Ledger/ ERP/ MIS/ Budget Plan/ Forecast / Finance - planning
Those are all the major to full fill the company requirement for future, after implement the WMS need to study the productivity result AS IS & TO BE meassures.
It is not just saving cost by implementing WMS but bringing professionalism to Warehouse Operation and apparently saving cost.
How professionalism comes:
Full control on Inventory Management all In and Out bounds
The stock is fully visible in SOH
GRN , PRN , order management , put away process etc are well controlled
Cycle count process bring you the real pictures of discrepancies, color difference, mismatch SKUs etc
Track the user who has used the module to GRN or Order Picking etc
KPI can be tracked
Quarterly or Yearly Stock Take is correctly updated
Saving Cost :
Help company save cost in term of all malpractices highlighted
Discrepancies fully controlled
Discipline warehouse operation
More than% fast track Order Process
More than% fast track operation
Less chances of mistakes
Full visible of operation to Higher Management
It really depends on the size and current inefficiency of the business in question.As someone who has been involved in many WMS deployments in the USA, Asia and the Middle East I would say that you can expect an advanced WMS to see a% increase in labor efficiency within months. I have seen some warehouses double labor their efficiency in2 years.The other benefits you will typically find are:
In the3PL space, a multi-client WMS with integrated billing and activity based costing modules is much more efficient in capturing revenue leakage than a manual capture and it is not uncommon to see revenue increases of-% in client invoices.
