Warehouse management is the control of the day-to-day operations of a warehouse, such as the shipping, receiving, put-away and picking of goods.
Is it the same as Stock Control?
The term is sometimes used interchangeably with the ‘stock control’ or ‘inventory control’. However, we would argue that they differ in a number of respects.
Stock control aims to maximise profit by getting inventory right, whereas WM aims to maximise the efficiency and effectiveness of warehouse operations.
Put another way, stock control means you know how many of a particular product you have and when to order more; WM tells you which bins those items are in and the order in which they need to be picked. Warehouse management software typically includes a stock control module.
Why use Warehouse Management Software?
Because warehouse operations are complex, they can generate a lot of paperwork. Warehouse management software automates manual processes and enables centralised control and visibility of all warehousing procedures.
There are huge advantages for wholesalers, distributors, merchants and retailers in moving to automated systems: the most advanced companies consider that the warehouse has the potential to be transformed from a cost centre to a growth centre.
A 2013 distributive trades study found that 66% of IT and operational decision makers plan to expand warehouse technology investments by 2018, citing the need to increase worker productivity and streamline processes.
What are the Basics?
- Inbound processes: items need to be checked and logged as they are received and put away in the correct bins, or packed for dispatch without further storage (this is known as cross-docking).
- Warehouse layout and slotting: fast moving items need to be near the front, items that are often bought together need to be close to each other, items that are easily mistaken for each other should be separated.
- Picking: it must be easy for your pickers to find items, and their journey time between items and between orders should be minimised.
- Packing: your orders must be packed in the right packaging, complete with an accurate contents slip and added to a delivery manifest for dispatch.
- Shipping: the right orders must be on the right vehicle at the right time, with the right delivery manifest.
- Managing returns: returned goods need to be unloaded before the vehicle is available for loading again – these goods then need to be checked off against the original order and the information logged against your customer’s account.
Advantages of using a Warehouse Management System (WMS)
A WMS will enable you to analyse current procedures and performance, and implement improvement that will:
- Reduce picking errors: picking errors are costly at any stage of the process – if they are spotted before dispatch, there are the labour costs of re-picking. If incorrect items are shipped to the customer, not only is it expensive to accept the return and process the replacement, but there is the hidden cost of damage to the customer relationship.
- Optimise stock control: there must be a balance between having stock available for customers, and tying up too much capital.
- Maximise use of space: the right proportion of floor storage, vertical storage, racks and pallets for your warehouse will depend on the types of good stored and the patterns of distribution.
- Improve worker productivity: your workforce is likely to be your biggest cost. How much would you save if you improved productivity by 5%? Or by 10%?
- Ensure compliance with Health and Safety regulations: a WMS can guide workers through risk assessments and flag up warehouse safety requirements, protecting your company, workers and customers alike.
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