Archives for WMS system for Microsoft Dynamics NAV

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.

Learn more about the Benefits of Warehouse Management System

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: