Archives for Warehouse Logistics Software

Cloud Warehouse Systems ROI Considerations

There’s an evolution taking place in the IT industry: the continuous and steady progression from traditionally installed software to cloud technology. In the cloud computing model, the vendor provides Web-based access to applications as a service, through a subscription pricing model. The vendor takes responsibility for everything, including servers, storage, backups, system updates, applications, databases, and maintenance. This eliminates the need for customers to buy, deploy, and manage IT infrastructure, saving the customer large upfront deployment costs and ongoing maintenance headaches.

Warehouse Management System Technology is now available in the cloud delivery model from some providers, offering a lower cost, reduced risk option. When evaluating WMS providers, it is imperative for every business to understand the total cost of ownership (TCO)—including both direct and indirect costs—of the technology and labor associated with adopting WMS technology. The scrutiny of new technology projects has never been higher and building a business case to justify an investment in supply chain management technology has never been more crucial. While some see cloud as being simply the next level of technology, the shift towards cloud computing also has very tangible financial benefits.

More Technology for Less Cost:

For most businesses, infrastructure, development, and IT management are not core competencies or business differentiators. The anemic economy compels businesses to look even harder at their core competencies and costs. Ask yourself: can someone else do it for you more effectively and at less cost? Take, for example, the explosive growth of 3PL/logistics services providers, hired to take on tasks manufacturers and distributors used to do themselves, because the 3PL can perform the service more efficiently and at less cost than the company can itself.

Lower Total Cost of Ownership (TCO):

Performing system upgrades is one of the most dreaded IT tasks related to traditional WMS software. Did you know there are a large number of businesses out there that have had to cough up a million dollars just to upgrade their WMS? With WMS in the cloud, your vendor performs routine software maintenance for you, including scheduled upgrades and patches. Additionally, in traditional enterprise data centers; it is fairly common to experience capacity constraints or waste caused by spikes and troughs in demand throughout the year. You either need to wait while additional server hardware is ordered, shipped, and brought into operation—which can take months and cause lost business and unfulfilled orders—or you have excess capacity, meaning wasted space and expense. The cloud is elastic and scalable, so you can access more power when you need, and scale back during slower periods.

Removes the IT Requirement, and Empowers The Supply Chain Team:

In many companies as much as 70 percent of the typical IT budget is spent just on making sure the business remains operational— tasks such as keeping servers running and performing upgrades. In the best cloud models, IT staff can devote their time to improving the business, rather than trying to solve infrastructure issues and applying software patches. IT can move from being an interchangeable commodity to a differentiator, shifting from maintenance to innovation.

When an IT team knows they need to run the underlying infrastructure, they realize there will be an inherent expectation that the business will rely on them for broader application support. Using cloud applications forces businesses to think differently about who will truly be accountable for the software and its implementation. If it is determined that the business process owners should “own” the software, the business process owners should likewise be accountable for it.

In order to make good business decisions about information technology investments, the business process owner—not the IT department must make the decision about investment and commitment to information technology. Sound business decisions about using technology cannot be made if the business owner perceives to be getting the system “for free” from IT. Similarly, a decision to invest in IT should not be limited by lack of internal IT resources or IT project prioritization. If a technology project stands on its own business merit, there should be a mechanism to execute on that project. That means that IT is freed up, and the supply chain department:

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WMS in the Cloud: ROI Considerations:

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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:

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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.

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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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Achieve over 99% Picking Accuracy with WMS

Warehouse Management System (WMS) allow you optimize your business processes, space and labor in order to achieve tremendous inventory movement efficiency.  Warehousing technology can have a surprising short return on investment (ROI) once fully implemented and utilized along a company’s warehouse(s).

Although there are typically “non-quantitative” results from choosing a Warehouse Management System such as a boost in customer service levels, for example, or keeping personnel cost down and an increase in warehouse operations.   There are, however, several measurable numbers on how this technology can help the movement of goods in your warehouse such as:

Order Accuracy:  Achieving over 99% AccuracyWarehouse Man with Scanner

Outbound Shipments:  Volume increases 15%; double your orders per day Inventory

Accuracy: Over 99% and up to 85% less inventory loss

Picking Times and Lines:  Reduced time 20% and triple number of lines picked

Directed Put-away: Replenish accuracy over 99%

In addition, Warehouse Management Systems generally have seamless Integrations to many Enterprise Resource Planning systems (ERP) and other supply chain management technology such as EDI solutions.

Warehousing technology, such as HighJump AccellosOne WMS, can play a vital role in completing and optimizing your supply chain to achieve a total optimize solution with measurable results.  In our technology-driven business environment, customers are increasing demanding these solutions to properly support their requirements.

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Posted by iCepts Technology group, Inc. An Accellos Warehouse Management Systems partner in Pennsylvania.