Warehouse Management System Blog

Managing Warehouse Space Better with Warehousing Technology

Warehouse Management Systems (WMS) are designed with savings in mind to manage your inventory in the most efficient manner possible.  However, additional benefits can be recognized in other areas, such as cost saving associated with reduced labor and administrative costs, plus also an increase in customer service levels.  Another area as well includes both efficiency gains and reduced cost is in the area of better space management for your warehouse.

Consider the following. Can you eliminate or minimize the need for outside storage?  If so, you have the direct savings of reducing lease cost (normally on a $ per sq ft basis), insurance, and possibly transportation costs. Depending on the size, complexity and activity of the off-site storage, you may even be able to save labor costs associated with managing and transporting the inventory back and forth. Improvements in space utilization generally range from 5-15%.

A Warehouse Management System (WMS) tracks every location and knows where each product and quantity received should be stored. Put-away can be directed to maximize space utilization, minimize put-away travel, minimize pick travel, or some combination. The WMS knows the size and weight of each item, case and pallet, and the physical constraints of each location.

Material is placed in an appropriate location based on these criteria and other pre-configured put-a-way rules pertaining to forward pick location replenishment, product velocity, storage requirements, etc. Space utilization improvements are generally step functions. In a typical situation where the distribution infrastructure is owned, the creation of empty space in the warehouse produces no real benefit. The amount of space made available must be enough to provide for other activities.

For instance, if 500 ft2 are freed up, this will provide very little benefit. If, however, 5,000 ft2 becomes available, several alternatives can be presented for the new space. For internal space savings, if enough space is made available to avoid new construction expansion or a green field site, this can be directly qualified as a cost avoidance.

For example, if enough new space is available to be used for light manufacturing, value added services, offices, etc., this can be classified as a savings. If the new space can be subleased, this can also be classified as an incremental cash inflow. However, you must also consider the potential cost of refurbishing the facility as required by the potential tenant. Additionally, location utilization is improved by using a WMS. A non-automated operation is generally considered at capacity when 80% of the locations are being used at any given time.

With a WMS, operating capacity can be increased to 95+%. This improvement is due primarily to the WMS’s ability to continually manage inventory consolidations, re-warehousing activities, and mixed item locations.

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Warehouse Management Systems Direct Labor Savings

Warehouse Management Systems are designed to execute the proper and efficiency flow of inventory along with warehouse procedures to reach a streamlined supply chain.   A large component improvement with this technology is gains in cost as it relates to labor. Labor productivity improvements can range from 20-30%. Labor is generally classified in three areas

  1. Direct,
  2. Indirect and
  3. Administrative.

This article focuses on direct labor savings achieved through Warehouse Management Systems or WMS

It is reasonable to expect up to a 20% improvement in direct labor productivity. Direct labor is better utilized due primarily to a WMS’s ability to provide specific task assignments based from a concise picture of inventory availability, inventory positions, and the overall movement activities to be accomplished. System directed activities minimize operators time spent identifying what actions need to be accomplished and planning the activities once they have been identified. The below key areas of warehouse activity focus on savings reached through WMS software functionality.  The sum total has the potential for dramatic labor cost savings.

Receiving: Generally, labor requirements in receiving stay the same for direct material handling but are eliminated for clerical activities. Efficiency in down-stream warehouse activities depend on the receiving process to capture and record accurate data. At startup, efforts should be made to ensure data integrity.

Once a system has been in use for 6 – 12 months, potential improvements in receiving labor productivity should be reviewed. As an example, you could use a wave receiving process to receive multiple purchase orders simultaneously and see improvement in both receiving labor productivity and dock utilization.

Put-a-way: Activities can be combined with the receiving process to minimize material hand-offs and staging or put-away can be performed as a separate activity to expedite the turn-around of trailers and improve dock utilization. In either case the WMS’s ability to identify appropriate put-a-way locations and direct the operator to the location will minimize an operator’s time spent searching for available storage locations.

Replenishment: In a forward pick/reserve storage environment, wait time for replenishment can be eliminated if replenishment activities can be managed by the WMS. In a system directed environment, forward pick locations are triggered to automatically generate replenishment commands based on inventory threshold levels. Replenishment activities are then performed in advance of pick operators being dispatched. This offers a significant savings potential if the amount of time pick operators spend waiting for material to be replenished can be quantified. Additionally, delays in the order picking process potentially lengthen the overall order delivery cycle time.

Picking: A majority of the labor savings is typically found in order picking which accounts for at least 50% of the labor costs. In general you should be able to practically eliminate time spent searching for lost inventory and improve pick labor productivity.

Picking improvements can be accomplished in several ways: Orders can be grouped to allow picking of multiple orders on one pass through the warehouse. The type of pick process you use is driven by cost, handling characteristics, and order profile.

Being able to match the right pick process to the order profile will result in improvements.  To understand your order profiles , consider analyzing 6 to 12 months’ worth of order history and develop a table or order distribution graph similar to this chart for your operations. Then begin to think about how you can manage to each order type.

Learn more WMS Cost Saving by Downloading the Business Case for Warehouse Management Systems:

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How WMS Software Can Save Money for your Company

Warehouse Technology Systems, commonly called Warehouse Management Systems (WMS), are designed to make the movement of inventory in and out of the warehouse as efficient as possible. Through advanced functionality such as different inventory picking options, lot and serial management, cycle counting, bin placement,  space management, ERP to WMS integration and others; warehouse management improvements can be realized that can offer significant savings from having increase accuracy, fewer errors and reduce labor cost.

Increased Accuracy-If the physical inventory “on the books” and the physical inventory in a warehouse do not match, the situation is often chaotic. When a warehouse picker goes to retrieve a part and it is not there (or not enough is there), a series of manual checks and back tracking must be completed to fix the problem and get the order out the door. Inaccurate inventory results can have broad consequences including:Savings

  • Poor buying practices and excess safety stock associated to buyers lack of confidence in record accuracy
  • Delays in order fulfillment associated to lost or misplaced product
  • Lost sales due to stock outs and over commitments
  • Costs associated to placing and managing back orders
  • Lower labor productivity associated to searching for lost product
  • Potentially higher freight costs resulting from expediting shipments to customers

Example: These issues could result in excess inventory, which ties up capital and negatively impacts capacity. The results are higher costs, low productivity and bad customer service. The self-checking nature of a WMS, in addition to a good cycle counting program, ensures inventory accuracy of 99.9%. This high level of inventory accuracy is the foundation for a majority of the other benefits realized in using a WMS. Inventory may be the highest asset in your company.  What is the financial impact of 95% inventory accuracy compared to 99.9% over the course of a month or year?

Fewer Errors-A real-time Radio Frequency (RF), ie. Hand Held Bar Code Scanning driven WMS is self-checking. As transactions occur, the system verifies the activity and may even prompt the user with a question if the system detects a potential problem. In a paper-based environment, errors are common across all functional areas. The impact of an error in one function is amplified throughout the overall operation. An error in receiving (wrong product number, wrong quantity, etc.) will create potential delays across many operations.

Example: Let’s assume 20 cases of part A are received as 200 cases, a put-a-way operator may spend considerable time searching for the extra 180 cases. In a non-automated environment, it is common to have operators putting away whatever product is in a staging queue without checking product numbers or quantities. In this instance, the
quantity error in receiving will get pushed even further downstream as operators are sent to pick 40 cases from the
load with only 20 cases physically on hand. Also, if an automatic payment correction is generated, you may end up requesting approval for payment of an additional 180 ghost cases.

In a paper based manual data entry environment, there is also an increased chance of data entry error. Humans make mistakes; WMS doesn’t. Studies have shown, on average, one out of every 300 keystrokes is an error. The cost of even one such error can be significant.

Example: What would be the effect of a missed product of some value, such as the cost of miss shipping a piano to Albany, Oregon, instead of Albany, New York, could easily run in the thousands of dollars. And, this does not take into account the added cost in damaged customer relations. The automated data collection nature of an advanced WMS results in process efficiency and data integrity. The benefits of data integrity are numerous.

Reduced Labor Cost-By eliminating manual data entry, associated fixed labor costs are immediately reduced. These reductions alone can justify an investment in automated data collection which is a key component of WMS. But other labor costs are reduced as well.

Example: Administrative labor is reduced as less time is spent correcting errors. Fewer errors and timelier, accurate information also mean fewer, more productive meetings for managers and executives. In general, automated data collection lowers labor costs by reducing overall setups, idle time, cost of expediting, and time spent correcting errors.

Example: It is reasonable to expect up to a 20% improvement in direct labor productivity. Direct labor is better utilized due primarily to a WMS’s ability to provide specific task assignments based from a concise picture of inventory availability, inventory positions, and the overall movement activities to be accomplished. System directed activities minimize operators time spent identifying what actions need to be accomplished and planning the activities once they have been identified.

Download the complete Business Case for Warehouse Management Systems 

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Warehouse Management Systems Guide

When evaluating different technology for better supply chain optimization, a Warehouse Management Systems Guide can help answer questions regard functionality, expected benefits and return on investment. A successful Warehouse Management System (WMS) implementation can provide a quick ROI, serve as a foundation for instituting a continuous improvement culture and facilitates on-going annual benefits, plus greatly increase the efficiency of flow of goods in and out of the warehouse.  For some companies, justification in a WMS is a matter of survival. Having the right material available at the right place and at the right time is no longer enough. In today’s economy potential requirements include:

  • Compliance LabelingBeautiful and happy female boss in warehouse
  • Floor Ready Displays
  • Advanced Ship Notices (ASN)
  • Postponement
  • Light manufacturing
  • Collaboration
  • Unique Customer Demands
  • And More!

Leading companies are realizing information has a specific shelf life value that diminishes over time, often by the hour or minute. Many of the processes and activities being managed and monitored by Supply Chain Event Management (SCEM) applications relate directly to warehouse operations. As the focus on SCEM applications continues to grow, the need for real-time activity tracking and inventory visibility offered by a WMS becomes even more critical to your organization.

Regardless of your perceived need for a WMS, an effective campaign to procure and implement a new system could depend on a solid business case. A good business case will include both tangible quantitative dollar justifications and the qualitative, intangible benefits difficult to enumerate. This paper introduces a tool to use when developing a project justification, identifies benefit categories for potential inclusion in the business case, and discusses areas of opportunity within the various benefit categories

A sound business case is critical to obtaining the management and employee support so important to a successful system implementation. The business case will consist of two components;

1) A Financial Business Case

2) Narrative explaining the assumptions behind justification estimates and providing an accurate picture of the intangible benefits.

A business case is a cost/benefit analysis aligning the project goals, costs, and risks to the company’s business objectives and financial expectations. The bottom line, the value of the benefits over the life of the project, normally 3-5 years, should exceed the total investment of the project over the same planning horizon.

This detailed guide will review both the tangible and intangible benefits associated with Warehouse Management Systems in addition to Return On Investment (ROI) financial considerations:

Download the Guide for Considering Warehouse Management Systems:

Better Inventory Flow with Warehouse Management Systems; Part 6 Replenishment Picking

In this final post, we will discuss Replenishment Picking.  All of these picking strategies are designed to gain warehouse inventory efficiency by selecting the best movement of goods in the most productive manner and part of any good “Best-In-Breed” Warehouse Management System, like AccellosOne WMS.

Replenishment Picking. Replenishment Picking combines the concepts of Batch Picking and the ReserveWarehouse employeeS scans informations from boxes in the warehouse.Storage/Forward Picking best practice. Reserve Storage/Forward Pick is the practice of segregating the warehouse into a storage (Reserve Storage) area and a picking (Forward Pick) area. This approach tends to optimize overall space utilization and pick labor productivity. Space utilization is improved by storing product in bulk (pallets or cases) in dense storage locations. Pick labor productivity is improved by keeping pickers working in smaller forward pick zones that typically hold smaller inventory volumes (days on hand vs. months on hand) with the inventory, eaches, or cases, in more easily accessible and ergonomically friendly locations referred to as the “strike” zones.

When using this approach it is common practice to setup a replenishment strategy to move inventory from the (reserve) storage locations into the forward pick locations. The timing of the replenishment activity is driven by a predetermined reorder point and the amount of inventory to replenish is typically driven by a pre-determined inventory level set at the forward pick location.

The same basic storage and picking principles apply when using Replenishment Picking – Forward Pick with minor variation to reorder point and quantity. With Replenishment Picking, a dedicated forward pick zone is setup to allow operators to work in a smaller area and the inventory is replenished from bulk reserve storage locations. However, replenishment quantity and timing is driven by the projected number of orders over a given time frame (typically a day). Once a group of orders for the day is created, the orders are replenished, in batch, to the forward pick area. At the end of the day, the forward pick area is picked clean and ready for the next pick cycle.

Another form of Replenishment Picking is replenishing to a pack station rather than a dedicated forward pick zone. In this process, all inventory for a group of orders is replenished in batch from reserve storage locations and deposited at a pack station. At the pack station, the inventory is picked to specific orders for shipment processing as outlined in the Batch Picking process.

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Posted by iCepts Technology Group, Inc. An Accellos Highjump WMS ReSeller

Operationally Considerations for a WMS System

It has been around long enough to be considered one of those “classic debates”: ERP warehouse management module or best-of-breed warehouse management system? One would think that by now this debate would have been settled. The facts and opinions have been examined for well over a decade, surely there must be a clear winner by now. If only it were that simple.

There are many reasons why this debate persists. One of the primary reasons is that companies are made up of departments and people that often have differing, or even conflicting, priorities. Sprinkled in among these differences are often strong opinions.  Opinions are not easily altered and the people that hold them didn’t get to where they are by quickly letting go of theirs in the face of debate.

Another key factor that keeps this debate fresh is the expansion of the dilemma to small and medium size companies. Early in the debate, most of the buzz was around SAP and Oracle ERP versus tier 1 best-of-breed warehouse management systems (WMS). Today, many ERP providers to small and medium businesses (SMBs) are also venturing down the path of expanding their suites to include warehouse management functionality.

Although still playing catch-up, the likes of SAP and Oracle have made gains in the last few years and are closing the functionality gap versus best-of-breed warehouse management systems. Due to a later start, the same cannot be said of ERP providers to SMBs. In this space there still exists a significant gap with respect to warehouse management system functionality. If the debate were solely focused on functionality, it would be short-lived for SMBs. Since there are other factors to consider, the debate endures.

Operationally Considerations: Workers In Warehouse Preparing Goods For Dispatch

The operations team will ultimately use the system to run their business so their primary focus will be on the system’s functionality. They will be looking for a system that not only meets their complex requirements today, but also a system that will enable them to grow, meet new requirements in the future, and that will provide tools to differentiate themselves from the competition.

The operations team will also be looking for a system that will ensure gains in operational efficiency. Maintaining the status quo in this area will be unacceptable. Systems implementations are difficult as there is a learning curve with new technology. Without the real benefits of increased operational efficiency and cost control, operations may resist the change and therefore adoption will be hindered. There will be the pervasive feeling of having fixed something that wasn’t broken.

So let’s take a closer look at functionality. ERP providers to SMB’s are in the early phases of creating warehouse management functionality. Naturally, any software company that is building a new product is going to start with the foundational elements. Just like constructing a building, if there isn’t a sound foundation, then anything else built on will be of no value. This is an important point. While it is clearly necessary to have a solid foundation and it is the correct place to start, it is not where the core value will be delivered from the system.

As an example, take picking rules. A best of breed system will have dozens of different rules that can be applied in each operation. These rules have been built up over time from implementations of the system across many industries and customers. This functionality not only provides a much higher level of flexibility, but it also provides the assurance that the functionality has been exercised and proven in the field many times

Contrarily, an SMB ERP has far fewer options in this area so the customer has a choice, they can make do with the existing functionality and forego the operational efficiency gains; or, they can implement customizations or workarounds each of which will increase cost and risk.

The list is actually quite long when one scrutinizes the functionality gaps between an SMB ERP warehouse module and a best-of-breed warehouse management system.

The following highlights those that will have the biggest impact on the operation:

 WMS Functionality  

Container  Management:

ERP:  Single Level; often only pallet.

Best-In-Breed WMS:  Multiple levels; including nesting (i.e. case on pallet and eaches in cases).

Business Impact:  Multi-level container management enables varied movements to be created and executed in warehouse and provides the ability to ship customers in multiple units of measure .  With multi-level, ASN information can be provided to customers since item level container detail will be available. 

Picking Rules:

ERP-Generally a single sortable code on locations to define pick paths.

Best-In-Breed WMS-Dozens of pre-existing picking rules as well as the ability to create user defined rules.  Some examples include, both Wave and Batch Picking.

Business Impact:  Advanced picking rules enable increased efficiency and inventory accuracy through order batching, optimized pick patterns, and proper execution of inventory strategies (i.e. FIFO).

Put Away Logic:

ERP-Usually a single primary put away location for each product.

Best-In-Breed WMS-Advanced put away logic and the ability to create user defined rules.

Business Impact:  Advanced put away logic ensures better space utilization and increased efficiency through the ability to top off pick locations, segment inventory across zones, and comingling of products.

Value Added Services :

ERP-No ability to preform value added services in base products.

Best-In-Breed WMS-Numerous value added service capabilities such as Kitting/Light Manufacturing.

Business Impact:  The ability to provide value added services for customers fosters innovation, provides operational flexibility and is a key differentiator. 

Ancillary Tools:

ERP-Not available in base product

Best-In-Breed WMS-Integrated functionality  in warehouse management systems such as Dock Scheduling, Transportation Optimization, LTL/Parcel Shipping Integration

Business Impact:  These are key inventory tools in delivering value from the warehouse management system through increased efficiency, and reduced errors from the manual processes

These are but a few important examples where functionality gaps exist. As highlighted in the introduction, if it were solely functionality based, the decision would be easy. However, there are other key stakeholders, so the discussion must move beyond functionality. For the system to deliver value and foster confidence with the operations team, it must function without failure and have near 100 percent up time. That is where the IT team comes into the discussion.

Learn more about Best-In-Breed Warehouse Management Systems

Find about Microsoft Dynamics NAV to AccellosOne WMS Integration

3 Warehouse Management Fundamentals for better Automation

In the tough global economy that we find ourselves in, companies are increasingly looking for tools to help them do more with less. It’s not OK anymore to simply get the job done, we have to find ways to continue to increase responsiveness, drive down cost and not grow resources at the same time. Not a job for the faint of heart!

Automating operations in your warehouse attacks many of the variable costs that a distribution company or center controls:

1. Labor

2. Physical space

3. Inventory

This post addresses how automating warehouse processes, such in Warehouse Management Systems, can help companies like yours do more with less. It focuses on how system directed processes, like put away, can allow you to maximize the use of your warehouse labor pool, improve the utilization of your warehouse space and assist you in stocking and locating your high velocity items.

Fundamentals of Warehouse Automation:

Let’s start with ensuring that we’re speaking a common language. Many people view the use of a handheld computer as warehouse automation. In some respects, it is hard to argue with that definition as they are unquestionably taking intelligence to the warehouse floor. But, it doesn’t truly provide the gains that can be achieved through the use of a fully featured warehouse system. Generally, warehouse automation falls into three categories:

1. Automated data collection – the use of handheld computer to “record” manually assigned activities on the warehouse floor. Examples would be picking, receiving and counting.

2. Warehouse management – the use of business rules and algorithms to determine the optimal way of picking, receiving, storing and counting and the subsequent of assignment of those tasks by the system to individuals using handheld computers in the warehouse

3. Warehouse control or automation – the incorporation of sophisticated hardware, such as conveyors, diverters, carousels, vertical lift stations, etc, to supplement the capabilities of warehouse workers in completing system directed tasks

System Directed Putaway:

We’re going to focus on the benefits to be gained through the use of definable business rules that drive putaway activities in the warehouse.

Putaway is normally thought of as the process of moving received inventory from its current location (the dock, kitting area, or production department) to a bin or overstock location. The putaway process is also used to relocate inventory within the warehouse and to replenish dedicated bins with inventory from overstock. System directed putaway is when the system recommends or chooses the optimal destination bin rather than the operator selecting it.

While the benefits are numerous, from better management of returns to improved customer service, these are the areas that users typically find:

1. Improved use of labor

a. By utilizing predefined business rules, the system eliminates the guess work that a warehouse worker goes through today to locate a bin

2. What partially full bin could this item fit in?

3. How close is this bin to other locations for this item?

4. Based upon the velocity of this item, where should it be located to minimize picking time?

a. The picking process becomes more efficient because all products follow the business rules developed to maximize utilization AND effectiveness of storage

b. The time it takes a new warehouse worker to become effective dramatically diminishes. They don’t need to fully understand nor appreciate the physical layout of the warehouse nor do they need to be familiar with the extensive product catalog that a company may have

5. Maximized use of physical space

a. By following the predefined business rules, the system will better allocate physical space to allow for more products and if needed increased quantities of existing products within the existing space available

b. The system will create a better plan for sensitive items like those that are lot-controlled, serial tracked, hazmat, etc.

While most directed putaway systems allow for a virtually unlimited set of business rules to be defined, there are typically a few key factors that drive the rules:

1. The product or product categories utilization

a. Is the product a raw material that is used in kitting or production? If so, locating it near the production facility along with its peer products will drive better effectiveness in the warehouse

b. Is the product a replacement part used in a warranty and repair operation? Same logic as production. Locate it near the repair facility and minimize the physical movement of the goods within the warehouse

c. Is the product typically sold in “eaches?” If so, locating it in a high velocity location such as a carousel would be advisable

d. Is the product generally shipped on a sales order? And, do sales orders usually include a mix of vendors? If shipments are usually homogeneous by vendor, organizing your warehouse around vendor specific guidelines will net positive results. And, directed put-away rules can systematically enforce that organization

2. The type of packaging and storage requirements for a product

a. Does the product require special handling such as refrigeration?

b. Is the product stored in large spools or in bundles (i.e. lumber)?

c. Is the product typically sold by the case or by the pallet?

d. Does the product have specific weight characteristics that require specialized racking or storage?

3. The product or product category’s sales velocity

a. Does the product have a high number of bin hits, but a limited quantity sold?

b. Does the product have a minimal number of bin hits, but a high quantity sold?

c. Is the product “held” for one specific customer or group of customers?

d. Do different packages of a product exhibit different sales velocity?

In Summary:

A warehouse manager’s job is to ideally locate all of the products within a warehouse taking all of these factors into consideration. You can imagine the level of difficulty when you try to accomplish this manually. A directed put-away system allows you to build rules by product, product category or product and packaging to accommodate the parameters that we’ve just discussed. It allows the warehouse manager to nest rules – meaning that there is a primary rule that would ideally be applied, but in the case where that rule can’t be adhered to there can be secondary or tertiary rules that apply.

At the end of the day, the directed put-away systems’ job is to assess the available space in the warehouse and direct the warehouse worker to locate the product (either initially from receiving, from replenishment or by a move) to the bin that best meets the rules that the warehouse.

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Better Inventory Flow with Warehouse Management Systems; Part 5 Picking

From order entry to fulfillment, Accellos One Warehouse works together with your ERP system to provide the end-to-end solution for the materials handling management and real-time inventory visibility throughout the enterprise.  Accellos One integrates with many popular ERP systems including the Microsoft Dynamics Suite of ERP Systems. The following highlights a high-level process flow, derived from a subset of available functionality within Accellos One Warehouse focusing on Picking:

The Accellos One Warehouse picking process needs to remain flexible to accommodate widely differing environments.  No two warehouse operations are exactly the same.  Warehouses come in different shapes and sizes. Some are “wide open” in a square shaped space.  Others are contained in buildings on multiple floorsworker holds package in warehouse of forwarding, utilizing elevators to transport materials.  Warehouses will have varying ceiling heights. Some might have yard space.

Materials handling will differ by product shape and size. As a result, the warehouse racking infrastructure will vary by product size.  Many warehouses keep large products in bulk stacks or pallet racks.  While with small products, picking efficiency may be increased by storing smaller products in flow racking or static shelving.

Product velocity and order types also affect warehouse layout and consequently the picking strategies.  Companies that ship single-sku pallets of product to customers will have significantly different warehouse operations than ones that ship trailer loads of mixed-sku pallets (grocery is a good example of this).

Even subtle differences in customer requirements for consumer products wholesalers will have substantial effects on the materials handling and picking. Operations that ship to retail distribution centers will have different fulfillment requirements than those that ship directly to stores.

Accellos One Warehouse has an abundance of picking styles that will accommodate a warehouse manager’s fulfillment strategy independent of warehouse layout, product size, velocity and order characteristics.

Download the entire White Paper: How Goods Flow Through the Warehouse

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How Warehouse Technology can Help Reduce Inventory Errors

Companies, such as Wholesale Distributors, that carry a lot of inventory realize that mistakes are extremely expensive.  Mistakes cost your customer’s productivity, time, money lost sales and customer dissatisfaction.  It costs you lost productivity, lost sales, lost freight and shipping costs, inventory problems and the distinct possibility of lost customers. A small simple error can cost your company in a big way by a loss of future income from customer who is not happy.  New customers are hard to come by so taking care of the ones you have is imperative.  Mistakes are a very big problem for distributors whose net profits are already razor thin. It is imperative, therefore, to find ways and methods for reducing inventory errors with warehouse technology.Tracking Labor Management

What does your customer want? The product(s) they ordered, on time, in the quantity they needed, delivered as quickly and inexpensively as possible.

In manually, “paper-driven” run warehouses it is very possible to reduce mistakes by creating rigid processes that while they may work at reducing mistakes greatly increases your overhead and reduces productivity.  Many of the manual processes I see distributors using look good on paper but when the orders begin to pile up shortcuts are taken and many of the steps that are in place get overlooked in order to ship the orders.

A well implemented warehouse management system will help you create highly efficient processes for handling inventory and picking orders that will eliminate the inefficiencies and mistake riddled processes that plague most distributors.  This will enhance your customer satisfaction numbers and most likely help you attract new customers without adding to your workforce.

Happy customers and lower costs equal higher profits.  Inventory is probably one of your biggest assets as a distributor; what not optimize the entire shipping, receiving, picking, and packing process to streamline the flow of inventory in and out of your warehouse.

Learn more here about Warehouse Management Systems Features:

Posted by iCepts Technology Group, Inc. An Accellos Highjump Warehouse Management System Partner in Pennsylvania.

 

Ways Warehouse Management Systems Increase Inventory Accuracy

The proper movement of inventory in a warehouse is increasing becoming very complicated as there are more demands from your customers and volume.  As more and more transactions occur, so does the odds for errors.  Errors with inventory picking, packing or shipping always equate to loss revenue, increased labor cost and potentially unhappy or lost customers.

Wholesale Distribution organizations frequently turn to technology to solve this supply chain management challenge to keep errors at an absolute minimum through a high inventory transaction accuracy level.  Such a technology exist with Warehouse Management Systems (WMS), which are designed to ensure the highest level of inventory accuracy and efficient inventory flow through the use of advanced inventory tracking software and systems.  Below are some examples of ways warehouse management technology can increase accuracy:Warehouse Man with Scanner

1. Product Codes:  Whether you chose RFID or barcoding as a means of identifying various products, product coding greatly adds to warehouse accuracy. Pickers and packers can simply scan the items they are looking for to fill an order and immediately known if they are correct. This contributes to less accidental switches and confusion when picking and packing order.

2. Product Location:  Using a WMS solution to help design your warehouse for efficiency will help your pickers know exactly where they need to go for a product location. This reduces misplacement of items. In addition, pick times are lessened when items are arranged so that quick turnover products are close to packing and slow moving inventory is placed in lower traffic areas of the warehouse.

3. Inventory Management:  Having exact product codes and locations greatly improve the quality of the inventory data your company has for inventory management. Knowing exactly how many items are in exactly which bins, to be placed in exactly which orders, can aid in managing stock-outs, misplacements, mis-shipments and even potential theft within the warehouse. With better inventory visibility, orders can be sent faster without back-orders and costs can be cut by less inventory loss.

4. Filling Orders:  Knowing exactly where a product is in a warehouse and knowing how many are left in the bin help pickers fill orders faster. Packing can be expedited with fast-moving products closer to packing locations. In addition, scanning products help to get the orders filled correctly the first time and almost completely eliminate returns due to picking and packing mistakes.

5. Bin Replenishment:  With product data made available by scanning, bin replenishment can be made easy. The system keeps track of how many items are in each bin and slot and can be programmed with rules so that certain product numbers never drop below a certain amount. This removes the guessing from the reordering of inventory and the back-order problem when there are not enough items to fill a customer’s order.

6.  Big Retailer EDI:  When supplying products to a large retailer, it is important to provide them with correctly labeled items that will be read by the retailer’s computer system. Having incorrectly formatted labeling or no Advance Shipment Notice can result in the return of the order and a charge-back for that returned order. With product codes and inventory tracking in conjunction with EDI capabilities, order accuracy can be increased to 99.9%.

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