The warehouse may be the most overlooked component of the supply chain. A company can negate the most innovative customer experience in an instant if it can’t deliver the product to the customer quickly and accurately. A flawlessly run warehouse is critical to customer satisfaction.
But running the warehouse using spreadsheets, or pen and paper can quickly become a manual, chaotic and inefficient process, especially for businesses with hundreds, or even thousands of SKUs to manage, likely across multiple locations.
How do you know if a warehouse management system (WMS) is right for your business? Here are five fundamental challenges that result from manual, paper-based warehousing practices:
Inaccurate data capture
The data going out is only as accurate as the data coming in, meaning your warehouse records can only be as accurate as the information that is captured when items enter the warehouse. Accurate capture of item, lot and serial detail is a good starting point and ensures data is accurate for subsequent processes. If you’re relying on pen and paper, your warehouse records are more prone to human error and delayed information, which impacts both the customer experience and the bottom line.
Lack of real-time data visibility
According to some estimates(opens in new tab), nearly half of small and midsize businesses don’t track inventory at all, or use manual methods. Lack of real-time visibility into inventory causes problems throughout the organization and leaves you susceptible to risk, especially with regard to inventory levels. Without real-time visibility into stock levels you run the real risk of committing the same inventory to multiple orders and not having enough product to fulfill open orders. On the other hand, without visibility into what items are already committed, you can easily duplicate orders, ending up with excess inventory taking up space in the warehouse and tying up additional cash on hand.
Inefficient use of space and improper storage
With warehouse space at a premium, efficiently using it can be an essential means of increasing profitability. This becomes increasingly important as businesses add products to their portfolio, and around seasonal peak sales times, such as the holidays. Manual mapping processes are hard to keep track of and difficult to update. This leads to space being under-utilized, or the risk of running out of space as items arrive. It also makes it hard to identify fast moving inventory and storing it conveniently to minimize the back and forth when fulfilling orders.
Inefficient order release
Using manual processes for order fulfillment(opens in new tab) increases the likelihood and frequency of costly mis-picks. If caught before they leave the warehouse, mis-picks can be remedied, but they still incur the increased labor cost of not only picking the correct order, but putting back the incorrect items. They also keep orders from leaving the warehouse on time as they are worked again. However, mis-picks often leave the warehouse undetected. This creates a whole new set of issues—the order will likely be returned and need to be fulfilled correctly. The additional cost of shipping the correct order, as well as returning the incorrect order quickly add up. Items that cannot be put back into inventory lead to increased waste. Time associated with receiving the return and processing the correct order must be accounted for. Finally, the impact on the customer experience may not be immediately felt but could lead to the customer going elsewhere for future purchases.
Inefficient pick path
Relying on paper-based practices for order fulfillment also leads to additional labor costs associated with picking and packing orders. In a paper-based setting, operators will pick and pack one order at the time. This means they are very likely to traverse the warehouse multiple times to the same bin location throughout the day fulfilling orders. Without a system in place, they do not have visibility into the open orders and therefore they work through them chronologically, which leads to additional fulfillment time and labor costs.
So how does a WMS, specifically NetSuite WMS, help squash these fundamental challenges?
WMS mobile application workflows allow users to type, select or scan barcodes for transactions, items, lots/serial numbers and bins. A leading practice is to “force scan,” so that mobile operators are required to scan the item UPC, lot/serial (if relevant) and bin barcodes each time they interact with an item. Not only is this much quicker than writing down relevant details and then communicating (or miscommunicating) those details to an ERP system, it also ensures that the right details are scanned.
Being able to immediately generate an item receipt and update inventory levels reduces dock-to-stock time and allows inventory to be immediately and systemically available for subsequent processes, such as quality assurance, outbound commitment or fulfillment.
Using force scan on the outbound side assures accurate data capture and validation of the data capture against the initiating transaction. This allows warehouse managers and customer service to keep an eye on the status of sales and, most importantly, eliminates costly mis-picks.
Real-time and accurate scans of work order components, a work order and its associated bill of materials, items and item quantities that need replenishment (from overflow to primary picking areas) and of inventory being moved from warehouse to warehouse, not only ensures accuracy but also introduces real-time visibility.
Logic Driven/Rule Driven
Robust logic can be incorporated into the inbound/putaway processes, cycle counting, wave release and picking processes, and bin-to-bin replenishment based on min/max quantities, increasing efficiency and accuracy.
NetSuite WMS allows you to systemically build out your physical warehouse from your bin locations to the zones in which your bins belong, including their type (inbound / outbound staging, picking, overflow), replenish points and min/max levels.
Inbound putaway strategies allow for the system to recommend to mobile operators the proper bins for putaway based on item/inventory attributes. This ensures that the right items get to the proper homes and are stored appropriately and that the warehouse space is used efficiently. Finally, it ensures the inventory is immediately visible to relevant resources and NetSuite processes.
Wave release and wave release templates allow warehouse managers to identify the proper orders to release to the warehouse for picking based on any criteria, such as customer, expected ship date, item/zone, ship method and any or all of the above. Pick strategies enable the system to identify the proper recommended bin location based on concepts such as First-Expired-First-Out (or FEFO), pick to clean, pick to fill or primary bin location.
Furthermore, NetSuite WMS incorporates the concept of pick path to both single and multi-order picking. And, for multi-order picking, it will identify clustering opportunities. For a worker picking the same item for three orders released together, rather than traverse the warehouse three times to the same bin location, the system will recommend that they pick for all three orders in one fell swoop.
Built on NetSuite
NetSuite WMS is part of NetSuite’s unified suite of applications, and therefore reacts to, updates and creates native NetSuite transaction records in real-time. As an item is scanned, it immediately updates, or creates, the proper transaction and associated inventory in NetSuite. This introduces transaction and inventory transparency to the entire organization so that employees can more efficiently and accurately react and do their jobs more proactively.
NetSuite WMS provides a warehouse management system that optimizes day-to-day warehouse operations - including receiving, storage and fulfillment of items. It eliminates manual processes, allowing you to more efficiently run your warehouse, deliver on customer expectations and minimize handling costs.
Learn more about using NetSuite WMS to create your optimal warehouse(opens in new tab).