WMS or ERP? Which Is Right for Your Business?
iStock.com/Wavebreakmedia
Choosing the right software solution to manage and streamline your warehouse processes is essential to productivity and efficiency. Without a proper management system in place, your warehouse cannot function in a way that works for your team and your customers. The two main options for warehouse management include the traditional warehouse management system (WMS) and enterprise resource planning (ERP). Although they have some similarities, these two systems are distinctly different and have their own benefits. Here’s what you need to know about each of them, and how to find out which is the best option for you.
What Is WMS?
As mentioned before, WMS stands for warehouse management system. This system is used to manage the storage, order processing, and movement of inventory in your warehouse. It helps you track the progress of each item at each stage: receiving, picking, packing, and shipping. With this real-time data, you can optimize based on historical trends and information. You can make better decisions during peak times and slower times. With WMS, you can reduce shipping errors, which account for 54% of returns. It also establishes a seamless link from order processing and logistics to the physical movement of the product out of the warehouse. The very best WMS will allow you to seamlessly connect your e-commerce platforms, marketplaces, accounting platforms, shipping carriers, and more.
Pros of WMS:
- Adaptable to the needs of each business
- Focuses on real-time operations—changes and grows with your inventory
- Makes your warehouse efficient and productive with multi-functional components
- Reports help you predict your inventory needs, even during high peak events
- Cost-savings
- Lower risk investment
Cons of WMS:
- You will need to set aside time to update and set up your warehouse locations with the WMS
- WMS only covers your order fulfillment, inventory, and warehouse management
What Is ERP?
The second option for your warehouse management is enterprise resource planning, or ERP. Both small and large businesses can use this to stay competitive and efficient with the way they store and access information. ERP seeks to achieve this by streamlining all processes and information into one solution. WMS focuses on the warehouse inventory alone, while ERP automates every department in your organization including inventory, service, sales, human resources, purchasing, customer relationship management (CRM), material requirements planning (MRP), financials, and products. ERP contains some of the same capabilities as WMS as well, but they are not as thorough. With ERP you can track inventory and get information about when items are picked, packaged, and shipped, but it focuses on creating a streamlined flow of information between all areas of business.
Pros of ERP:
- Streamlines all platforms
- Makes the warehouse functions seem like a “free bonus” since it includes all processes
- Able to automate different aspects of your business—increases productivity and efficiency
Cons of ERP:
- May cost more in implementation and in the long-term
- May not be as flexible in terms of sharing data with vendors
- Lacks an in-depth look at inventory and reporting to maximize warehouse space
- Rigid and transactional because they operate across multiple departments
Which Management System Is Right for You?
The benefit of having two options is that you can choose the right system for your goals, challenges, and budgets. A few aspects to keep in mind before you choose the right system for you include the following.
Long-Term Goals
Consider the long-term goals of your business. What is required to get you there? Take time to define the measurable outcomes you hope to achieve and the functional requirements your business needs to get there.
Technical Requirements
You should also consider the technical requirements for storing and moving your products. What equipment do you need to integrate? This assessment will help you avoid problems related to your storage and delivery processes.
Return on Investment
Finally, you should calculate the return on investment (ROI) of each system by matching the costs of your long-term goals and needs to the implementation and integration costs. Consider how the increase in productivity will affect your bottom line. Each operations area of your business will be affected by your software, so it is important to carefully assess the pros and cons to make the best decision.
Get Help Managing Your Manufacturing Process with LSS
Both systems are important aspects in helping you manage your supply chain, but to meet your goals in the best way possible, you need to decide which of them is best for you. It is important to note that you can set up one of these systems on your own, or partner with a third-party logistics provider who can offer you these systems and more.
Lean Supply Solutions can help you if you are looking for a 3PL company with the latest technology and software systems. We are aware of the rising trends in the logistics industry and always strive to stay up to date. We commit to being aware of our clients’ operational challenges as they arise and help them get the most out of their supply chain processes. Our 3PL and 4PL, packaging, and supply chain management can streamline your processes for better success, as we deliver your products to your customers on time and help you achieve consistent, accurate, and quality results. To learn more about outsourcing to our 3PL distribution team or to ask any questions, contact us.
- Published in Blog
Strategies for Success with an Omni-Channel Fulfillment Service
iStock.com/dusanpetkovic
Steve Jobs once famously said “Get closer than ever to your customers. So close that you tell them what they need well before they realize it themselves.” For apparel manufacturers and retailers, this idea could not be closer to the truth. A good advertiser knows what their customers are looking for and delivers it. In this day and age, consumers want to search for the items they want, compare prices, and move between purchasing channels fluidly. Without seamless purchasing experiences, manufacturers and retailers miss incredible opportunities for sales. Learning to move with your customers, however, is more challenging than it sounds. Creating an omni-channel fulfillment solution through a third-party logistics (3PL) provider is the best way for you to achieve this goal. How do omni-channel supply solutions help you achieve success? Here’s how.
Invest in Fulfillment Technology
Today’s supply chain has access to multiple technologies that can optimize your processes. Some of these underutilized technologies include Transportation Management Systems (TMS), Distributed Order Management (DOM), and demand planning. With technology, you can become more efficient as you allocate inventory to your stores, warehouses, and customers in an efficient, reliable, and cost-effective manner. In addition, you can capture all information in the order management process and make it available through your channels to those who need visibility.
Use the Right Technology
When choosing technology to support your omni-channel fulfillment solution, don’t simply purchase the newest solution. You need to find out what works best for your specific needs. If customers are expecting fast shipping, your wholesale accounts and retail partners will also require quick packaging and fulfillment of orders. You can use the services of a 3PL provider to help you keep up with demand. Every brand is unique and depending on your business partners and where consumer demand is, you should seek a best fit strategy to meet these expectations.
Choose the Best Talent
Having the right talent is key for a successful strategy. Identifying the necessary skill sets and jobs required to help your business run properly is important. Take the time to consider what roles are crucial to your organization’s long-term success and find a partner that can help you achieve them.
Maximize Sales with Automation
Every business knows that to increase sales, manufacturers need to accurately forecast demand for each channel. The process of allocation can be tedious yet leveraging an intelligent Enterprise Resource Planning (ERP) solution is essential to making this work. ERP software helps to automate the allocation process and make smart decisions that lower your costs and resources. For example, if you are scheduling a flash sale, your solution should make this event more important over other channels and you should have allocation rules for a specific time frame to ensure that all these orders are fulfilled. Automation, robotics, and actionable intelligence can help you reduce the amount of labour-intensive aspects and make omni-channel fulfillment a reality.
Target High-Growth Markets
The omni-channel fulfillment market is expected to grow at a fast pace, reaching over $3.7 billion by 2020. To help boost this growth, companies like yours need to target high-growth markets. One way to do this is to consider the Tier 2 market. While most of the big businesses are actively targeting the Tier 1 market, there are increasingly more small companies that are switching over to omni-channel fulfillment solutions. This second tier of customers provides an excellent area of growth for suppliers.
Why You Need Omni-Channel Fulfillment Solutions
The omni-channel paradigm is not a fad that will go away. In fact, omni-channel commerce is only expected to grow. Whether you are a practitioner or a software supplier, you must establish and follow a road map for success to prevent yourself from getting left behind. By getting on board now, you can keep up with the changing nature of the e-commerce and omni-channel paradigm.
As mentioned above, if you invest in technology and adjust your operations to make your solutions more accessible, robust, and user-friendly, you will improve your customer reputation and see exceptional growth. Additionally, by reading and understanding data about your customer demands, you can adjust to meet their expectations and turn new customers into faithful clients. Even if you are a small company, there are ways for you to access this strategy to improve your business.
How Does Lean Supply Solutions Differ from Other 3PL Providers?
With so many 3PL providers to choose from, it can be challenging to find the right one for you. There are some aspects a good 3PL provider should have:
- Proven knowledge and experience that meets your needs
- Collaboration abilities with suppliers, customers, intermediaries, and other 3PL services
- Problem-solving skills
- Certification
- Variety of Services
- Custom Solutions
- Technology and Software
At Lean Supply Solutions, we strive to stand out from the competition by offering all the above services, as well as our Lean Methodology principles. This mindset and value of our organization focuses on eliminating any operations, equipment, and resources that do not bring success and value to our clients’ supply chain. We ensure that your customers get their products at the right time, and offer you consistent, accurate, and quality results.
Our services include contract logistics, manufacturing support, consulting and project management, product and order fulfillment, warehouse and distribution, e-commerce fulfillment, pick and pack, and more. Contact us today to learn more about how we can help you!
- Published in Blog