Archives for warehouse management software partner in Pennsylvania

Better Inventory Flow with Warehouse Management Systems; Part 2-Order Management

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 Order Management.

Forklift in warehouse-2

Sales orders placed by phone, fax or email are typically entered into your ERP system manually using the Sales Order Entry function. Orders may also be placed using a B2B (Business to Business) e-commerce web-site, remote sales through mobile devices or by EDI.

As a result of sales orders being entered into your ERP system, the warehouse management software is immediately updated.

Accellos One Warehouse is now responsible for orchestrating the order management activities. This is the prioritization of stock allocation and the assignment of work in the warehouse. The effectiveness of these tasks is critical to the efficiency of the warehouse and the service level that it provides.

Order management with Warehousing Software, is a dynamic process that requires the flexibility to accommodate many different warehousing styles. Some sales orders need to be immediately released for today’s pick run. Some may be held for a future date with or without stock reservations. Orders may be prioritized by backorder status, preferred customer status, fill rate, pick-up time, and truck route or by date. There are countless criteria by which orders are prioritized, allocated and released for picking.

Learn more about Warehouse Management Systems Functionality here

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Posted by iCepts Technology Group, Inc. A Pennsylvania Partner for Accellos One Warehouse Management Systems 

 

Making Room In Your Warehouse

Space management is a big deal!  Your warehouse (or vault as I like to refer to it) has only so many square feet.  You need to utilize the space to its fullest potential.  In part 5 of my series of blogs on the 4 simple ways to pay for a warehouse management system I will discuss how a WMS (warehouse management system) can help you use your space and save you money.large warehouse

A WMS should improve space usage through improved inventory placement and tracking.  Because the WMS gives you a full view of your warehouse and where your items are, which ones are moving and which ones aren’t you can manipulate your stock with ease.  Putting the fast items in locations that are readily available for picking and replenishment.  You will have full visibility of where empty slots or bins are in order to put products away.  You can mix pallets and use pallet license plates to identify with one scan what is stored on the pallet in the slot it is assigned to.  This can be a big space saving technique.  Here are some other areas where savings can be derived

  • Eliminate existing overflow space  (this is usually a second location used solely to store items that won’t fit in your main location)
  • Reduced transport costs with elimination of overflow space
  • Avoid or greatly delay new construction of additional space or move to bigger space

When you can use the space you have more efficiently this allows you to reduce the space used for existing inventory.  Because a WMS allows you to reduce your on hand inventory levels this saves you money in carrying costs and purchases.

We had one customer put off the need to build on to their distribution center by nearly 4 years.  And when they did it was in order to do more fulfillment work which had a very positive impact on their profits.  Warehouse space is expensive so use what you have in the best possible way.  A WMS will certainly help you do this.

It a Matter of Time

Over the last 5 posts I have reviewed the 4 simple ways a WMS can be paid for.  The time for achieving a return on investment (ROI) of an investment in a warehouse management solution should be very short.  Many companies find that the system can pay for itself in as little as 6 to nine months.  A good average to plan on is 12 to 18 months.  Once you have reached the break even point all the found money flows directly to your bottom line and it can be thousands of dollars each month.  What could you do to grow your business with an extra 5 or 10 or 20,000 dollars each and every month.

Wouldn’t You Like to Know

As you can see a warehouse management solution reduces labor costs, improves space utilization and reduces inventory cost.  The big question to ask yourself is “By how much”.  Each business is different, you should investigate how a WMS would fit into you business.  We recommend that you work with a company with a great deal of experience in how a WMS works and how a warehouse operations functions.  We suggest engaging with a organization that will collect, compile and total all the information and provide you with a sound useful and believable ROI.  Once you have done this the decision to purchase and implement a WMS should be very clear.

Find out more about Warehouse Management Systems by contacting us here:

 

Managing Your Labor Costs Pays Off

This is part 3 of my 5 part series on the four simple ways to pay for a warehouse management system. In the first part I listed the four ways and outlined each one.  In part two I covered how better control and accuracy of the inventory can save money and help pay for a WMS.  In part three I will discuss what is arguably your most important asset, your employees.

Here are a few points for you to consider; effectively managing labor costs in most businesses is difficult.  Labor costs account for a huge portion of your cost of doing business.  Arguably your staff in the warehouse can/will make or break your business.

Reducing or reallocating labor is the primary driver for finding the money to pay for a warehouse management solution.   A properly implemented WMS like Accellos One Warehouse can reduce your labor needs, help you reallocate staff and or keep you from needing to bring on more staff to meet growing sales or seasonal fluctuations.  More people mean more problems most of the time.  There is a long list of labor areas  that are strongly impacted by the implementation and use of best practices while deploying a WMS.

From the moment product hits your receiving dock until the invoice is sent for the shipped out items people are involved.  By using a WMS you increase the efficiency and accuracy of the work they do while eliminating the mistakes they will make.  A best of breed WMS should provide useful labor reports that can help you determine who your best people are and who needs help.  When the WMS is integrated tightly to your ERP/accounting/business management software  you can eliminate the costly clerical work.  This allows the people doing this manual data entry to be re-positioned  into areas that will help the company make money not just spend it.  Another plus here is the accuracy factor a WMS provides.  You can also speed up the invoices process which gets you paid in a more timely manner.

Here is an overview of areas of improvement;Workers In Warehouse Preparing Goods For Dispatch

  • Lines picked per shift are improved
  • Fill rates increase
  • Inventory accuracy is dramatically improved
  • Reduced staff and increased work volume
  • Higher pick/pack rates
  • Reduced shipping department needs
  • Shift elimination and or hour reductions
  • Transportation cost are optimized

It is not unusual for a WMS to reduce labor costs by 20 to 30 percent.   Lets look at a simple example.  If your annual labor cost for a staff of 15 warehouse employees including clerical support is $561,000.00 (18.00 per hour loaded, X 2080 per year, X 15 employees) and you save 20% with the implementation of a WMS you would save $112,000.00.  That is huge!  Of course every business is different but I have seen this kind of savings by many of our customers.  Maybe its time you took a good look at what you could save.

My next post will how cover how a WMS saves money by improving shipping accuracy.

Learn more about iCepts Technology Group and the many ways we work daily to help our customers improve their businesses.

Four Simple Ways To Pay For A WMS (Part 2)

In my last post (which I admit was a while ago) I outlined four simple ways a WMS solution can be paid for.  In this post I will discuss the first way, reduced stock.

It may seem obvious that if you reduce your stock levels you would probably save money.  But how to do this without causing disruption to fill rates and customer service is a key issue. With real-time and online data collection that a WMS like Accellos One Warehouse provides, inventory accuracy can be drastically improved.  This leads to a significant improvement in stock location, quantity and lot/serial number accuracy, as well as reduced “buffer” or “safety stock” levels.  If you reduce your inventory value while maintaining adequate stock levels to meet order demand you can save a tremendous amount of money and in addition reduce carrying costs as well.

Lets take a look at a simple example.  Let’s say you carry 5,000,000 dollars of inventory.  And you find a way to reduce that by 4% to 6% Industry average range when implementing a WMS) you could save $200,00 to $300,000.  Carrying cost range from 15% to 25% so if yours is say 20% you will pocket $40,000 to $60,000 dollars.  This will go a very long way in helping you invest in a system that will produce for you these kind of results.

In my next post I will discuss how reducing or reallocating labor will help you pay for a WMS solution.  stay tuned!!

 

4 Simple Ways to Pay for a WMS

Implementing a warehouse management system is one of the biggest “bang for the buck” things a business engaged in the distribution of products can do for their business.  The profits that can be re-captured when a business becomes more efficient and productive can be staggering.  Like wise when a business is not operating at top efficiency, is making to many shipping mistakes and is having problems with inventory accuracy and control it is most likely leaking profits.  Sadly this can happen without knowing it.  If you think all is well because products manage to get out the door in the warehouse it may be time to take a hard look at the warehouse operations.

Many times when talk with a business, they seem to understand the value in a WMS but can’t seem to see how to make the investment needed to pull the trigger and implement a solution.  Here are four areas where a WMS makes a serious impact and can quickly create the return that will pay for a WMS

1. Reduced Stock (Inventory)

2. Reduced or reallocated labor

3. Improved shipping accuracy

4. Reduced space requirements

In the next series of posts we will dig into each of these areas and explore where the money can be found to pay for a WMS solution. For information on our WMS solutions click here.  For more information on iCepts Technology Group and our other technology offerings click here.  

 

Will Your Business Thrive or Wither?

With costs and competition rising faster than ever, only businesses that find new ways to improve and increase value to both their customers and shareholders will survive let only thrive in today’s market.  Only certain activities within a business represent opportunities for adding value to the product or service the business provides.  In general, these activities are profit-generators that can be distinguished from the overhead and support functions of commercial/wholesale distributors web-based retailers and company warehouses.

Value added functions often relate the specifics of a particular business. The following are some value-adding functions that are common to most business and should be familiar to anyone who depends on their warehouse as a critical part of their operation:

  • Kitting Services
  • Marketing and sales
  • Production/operations
  • Inbound logistics
  • Outbound processes

Warehouses are generally seen as  cost-centers to a business and rarely are considered as an area for profit creation.  Yet some businesses have discovered ways to turn their warehouse into a significant competitive advantage.  Of the value-adding functions listed above, inbound/outbound processes relate directly to wholesale distributors or distribution centers.  In addition the quality of these processes along with storing, delivering and moving inventoried products can impact sales, production and services in a positive or negative manner.  In my next post I will discuss warehousing practices in the value chain and how a warehouse management system plays a significant role in creating revenue inside the warehouse.

Which 30% Is your Company In?

Less than 30 percent of warehouses are efficient, according to “Benchmarking Warehouse Performance,” a study by Georgia Institute of Technology in Atlanta GA Efficiency translates directly into money. You may have been wondering if a WMS system could make your warehouse more efficient. Interestingly, about 30 percent of the warehouses in the United States have a WMS system installed. What are the numbers telling us? Only 30 percent of warehouses are efficient, and less than 30 percent of warehouses have a WMS system installed. Which 30% does your company fall into?  If you are in the under 30% group that does use a WMS good for you.  Most likely you are many times over more efficient than those not using a WMS to manage their warehouse operations.

Those numbers are telling me we can fix the inefficiencies or “lost revenues” taking place in over 70 percent of warehouses. These leaks involve serious money being lost and customers being poorly serviced. My point is this: There’s a lot of information out there on how to make your warehouse more efficient, but what you needs to realized is, “It’s not what you know that counts, it’s what you do with what you know.” Many companies already know their warehouse is inefficient, but are reluctant to make the move to improve due to what they perceive as a high cost to purchase and install a WMS.  I would suggest they should take a very close look at the ROI that a good WMS can achieve.  It might surprise many to find out that the initial investment can be recouped in a very short amount of time.  If you own or manage a business that operates a warehouse which 30% do you want to be in??

 

Learn more about electronic warehouse management solutions by visiting http://www.warehouse-management-systems-us.com

Learn more by reading this white paper on How Goods move through an Accellos One managed warehouse

It’s Time to Retire the Pencils and Paper

I am astonished on a weekly basis by the number of businesses I encounter that are still managing their warehouse operation with paper and pencil.  In most of these companies I see well thought out processes to handle the many functions and activities in the warehouse.  And while these processes do work and the products manage to get out the door,  they are holding back the business from making higher profits.  Why?  Because they are extremely inefficient and inefficiency robs the company of hard earned revenue.

For  companies that are in warehousing, distribution or manufacturing it is time to retire the pencil and paper and move into the 21st century.  Today, with profit margins being razor thin and customers looking for the very best prices and added services you need to be as efficient and productive as possible.  Your warehouse has to be profitable.  No longer can you subscribe to the notion that if the products get shipped out then all is well.  It is time to automate as many  processes as possible.

Its starts with  barcoding and with automating the receiving, put-away, replenishment picking and shipping functions by moving to an electronic warehouse management system.  WMS solutions are no longer just for the big guns in the 3PL, wholesale distribution or manufacturing business segments.  It is time for small and mid sized companies to adopt this technology.  Frankly your customers demand it.  It is my opinion (backed up by a plethora of industry statistics from the Aberdeen Group, Gartner and Supply Chain Management to name a few) that those that do not step up their game will be left behind.  They will wonder where their customers have gone and why they are losing money.

I said earlier it starts with the barcode because the essence of a WMS is tracking very item in the warehouse and every task performed by scanning the barcode that is on nearly every product produced today.  And should you actually have products without a barcode you can create one.  In your warehouse you add barcodes to every storage location where product could be stored.  The combination of scanning the product and the location of that product begins to create an efficiency and accuracy not possible in a paper and pencil, manually operated warehouse.

So take those well thought out processes mentioned earlier that you have been operating with and  automate them through the use of a warehouse management system that best fits your companies needs and watch your profits rise.  Small percentage gains in efficiency, accuracy and productive will add up to a significant return on investment.

To read more on optimizing ROI in the warehouse click here.

To Read a recent case study on how one company has improved their operation through the use of a WMS solution click here

 

 

Top 10 “Must Have” Warehouse Management Systems (WMS) Features-Counting

Another “Key” feature for better inventory control is counting.  Counting should be a core module in any Warehouse Management System to accurately track all inventory.  Any sort of Counting Functionality should ideally support both Cycle Counting (forced and manual) and physical inventory counting.

Many distributors conduct an annual physical inventory. That is, they count the products in their facilities once a year.  Unfortunately we’ve found that most physical inventories are a total waste of time and money. Why?

Usually anyone with a pulse is drafted to count inventory during the physical.Even people who are not familiar with your products (like the receptionist and her brother-in-law) will be sent out to the warehouse so that all of the products can be counted in the time allotted.

Workers do not enjoy the physical count process.They probably have better things to do with their weekend than spend it in a hot or cold warehouse counting products. In all probability their actual objective is not to perform an accurate count, but to put down on the count sheet whatever management will accept so they can go home.

There is a tremendous time pressure to finish the count.Shutting down operations for a physical count is a very expensive process. Usually at the end of the time allotted, management will decide to accept the existing count as being as “accurate as possible” so that the company can return to the task of servicing customers. Many discrepancies between the computer’s perpetual inventory and the quantity counted may remain unresolved.

Even if an annual physical count is 100 percent accurate, how long does it stay accurate? A week? A month? Many distributors respond that on-hand quantities only remain accurate until they start shipping material again.  For most distributors, cycle counting provides a much better tool for maintaining accurate stock levels than an annual physical inventory. Cycle counting is the process of counting a few products every business day throughout the year.

There are three common methods to determine what products to count on a specific day:

1. Random selection—Products to be counted are chosen at random. While this method keeps potentially dishonest

employees on their toes, it does not ensure that all items in a warehouse will be counted on a regular basis.

2. Geographic selection—Products are counted in sequence. Starting at one end of the warehouse a certain number of products are counted each day until the counters reach the other end of the building. All products are counted the same number of times, even though some products are more susceptible to discrepancies than others.

3. Rank-based selection—Products that are sold most often (regardless of quantity) or have the highest cost of goods sold are counted most frequently. Slow-moving products and dead stock items are only counted once a year.

Of the three methods, we’ve found rank-based cycle counting to be the most effective at maintaining accurate stock levels. The more frequently an item is sold, the more chance for inventory inaccuracy. After all, every time someone fills an order or puts away a stock receipt is another opportunity for an error to occur. And the products that are requested most often are probably extremely important to your customers. In order to provide good service, it is critical that you have accurate counts for these items.

It is interesting that, for most distributors, relatively few products are responsible for the majority of product requests (also known as “hits”). You may have heard of the 80–20 rule or “Pareto’s Principle.” This theory states that 80 percent of your sales are derived from 20 percent of your inventory items. We’ve found this not to be true. Usually only 10–13 percent of a distributor’s inventory items are responsible for 80 percent of activity and 50 percent of items are responsible for 95 percent of sales.

We want to count the few items responsible for 80 percent of sales very frequently, perhaps four to eight times a year. Items with fewer hits can be counted less often. Let’s look at a typical rank-based cycle counting program.Items are sorted in descending sequence by hits. The items that are responsible for 80 percent of total activity are assigned to the “A” rank, products responsible for the next 15 percent of activity are assigned to the “B” rank, “C” rank products include the products that are responsible for the next 4 percent of activity, and “D” rank products are responsible for the last 1 percent of activity. Products with a rank of “X” have no activity (they’re dead stock).

• Count the “A” rank products six times a year

• Count the “B” rank products three times a year

• Count “C,” “D,” and “X” rank products once or twice a year

Rank-based cycle counting ensures that your counting activity is productive. Spending just an hour or so a day counting can make the difference in maintaining an accurate perpetual inventory system. It takes a lot of discipline to implement and follow a program in which you count a certain number of products every business day. Many distributors have tried cycle counting and abandoned the program. They’ve been frustrated as other tasks have interfered with the process or they have not been able to complete counting all of the products scheduled on a certain day. The following ideas have helped many of our customers develop successful cycle counting programs. These companies are working “smarter” rather than “harder.”

Additional WMS Software Counting Functionality could include:

  • Cycle Count by Bin
  • Inventory Count / Recount
  • Cycle Counting serialized items
  • Configurable workflow prompt for bin
  • Option to allow adjustments to inventory during Cycle Count based on discrepancies between expected qty and counted qty
  • Option to hold adjustments created through Cycle Counting in a pending state, for supervisor review
  • Ability to define bins to exclude from cycle counting
  • Physical Inventory Wizard supports Multiple Warehouses
  • Cycle Counting single-item license plates

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