LISA Distribution WMS, an SAP-Certified Solution for SAP Business One, available for SAP Business ByDesign

4 Ways Warehouse Management Systems Cut Costs and Boost Productivity

4 Ways Warehouse Management Systems Cut Costs and Boost Productivity

Growing businesses have warehouses stuffed full of inventory and product lines. Add to that a complicated network of suppliers and vendors, and increasingly impatient customers, and soon enough you’ll find your management systems (ERP) are stretched to their limits. Surely a robust ERP solution, such as SAP Business One or SAP Business ByDesign, can go a long way, but as your business continues to grow, an integrated and flexible WMS add-on will be required to keep pace with increasing order volumes.

But how do you justify the investment? Here are four ways a WMS will cut costs, boost productivity and increase your profitability. 

1: Gain Control Over Inventory Managment

As you increase product lines, your need for inventory will grow and so will your network of suppliers and vendors. Not only do you need raw materials and finished products, you have the added pressure of shrinking customer timelines. With products coming and going, not to mention bouncing between warehouses and distribution centers, maintaining the right inventory at the right time is a challenge.

An error can be made every 300 keystrokes. By introducing a WMS with radio frequency (RF) technologies, including handheld scanners, you greatly reduce the risk for manual errors. 

  • Time-saving RF technology cuts keystroke errors to nearly 1 in 3 million!
  • Inventory precision can be improved by more than 78%
  • Carrying costs can be reduced by more than 27%
  • RF technology delivers cost savings that lead to increased cash flow 

Cost Reduction/Cash Flow Improvements

  • Gain control over procurement with real-time inventory insight. Purchase only what’s required to meet demand without needlessly overspending and overstocking the warehouse.
  • Monitor stock as it’s promised for customers, in use or returned to the shelf, damaged or expired and as it’s shipped. Respond faster to changes in inventory use to avoid stock-outs.
  • The ongoing process of cycle counting eliminates the need for physical inventory inspections. You don’t need to hire more people to manage inventory, which will save money on salaries. 

2: Optimize Operations Throughout the Warehouse

The ‘Amazon Effect’ can be seen everywhere and it’s forcing businesses to make big changes. Customers are simply short on time, expecting a fast turn-around. That’s challenging for many businesses and few have any choice other than move faster to meet these demands. Competition is fierce in many industry sectors and if you can’t respond quickly to customer demands, you risk losing a customer to a competitor.

A strong WMS with wireless handheld scanners streamlines inventory management and provides reliable visibility throughout the warehouse. You can be confident you know exactly what inventory you have in the warehouse and whether it’s available or promised to other customers. You will easily improve fill rates by streamlining the pick, pack and ship process. Not only do you expedite this process, the WMS will confirm picking with existing sales orders to avoid choosing and shipping the wrong items or the wrong quantity of items. By redesigning the warehouse, you will optimize travel routes and workflows will guide warehouse personnel as they move inventory, pick and pack products and complete cycle counting activities. 

Cost Reduction/Cash Flow Improvements

  • Warehouses using a powerful WMS could see a reduction in operating expenses of more than 35%. This time and cost savings can be attributed to speed, optimized warehouse layout, and guided processes for the warehouse team.   
  • Replacing manual entry with handheld scanners optimizes productivity and labor use. You’ll need fewer people to manage inventory and the technology will save time and improve accuracy. It’s approximately 9 times faster to use barcoding than manual entry which saves you both time and money.

3: Improve Customer Satisfaction

Long-term customer relationships are essential to your bottom line. Providing every customer with quality products and expedient, accurate service is necessary for nurturing long-term relationships. There is little room for error which is why a WMS solution is becoming mandatory for wholesale distributors of all types and sizes.

Automating warehouse operations and inventory management will streamline and strengthen warehouse functions from receiving, order picking, cycle counting and shipping. With the right WMS and handheld devices, you can triple the number of lines picked and increase outbound shipments by nearly 15% and reduce the risk for mistakes.

It’s been said that it costs 10 times more to find new customers than it does to maintain happy customers. With a modern and integrated WMS, you can improve customer satisfaction through reliable, efficient services. 

Cost Reduction/Cash Flow Improvements

  • Expedite the fulfillment process and deliver the right products, in the right quantities, to customers on time, every time.
  • Avoid shipping errors by automating the pick, pack and ship process. It’s simply too costly to handle shipping mistakes, backorders and returns. Reduce shipping and freight costs by getting orders delivered correctly.
  • Show customers you can be responsive and reliable. Satisfied customers are more likely to refer your business to others. Boost sales and revenues by keeping customers happy.

4: Strengthen Warehouse Labor and Operations

A happy employee is just as important as happy customers. You rely on a strong warehouse team to perform important tasks that directly impact your bottom line. Strengthening warehouse operations is not only good for business, but also good for employee morale. Unsatisfied employees can lead to increased turnover which has both direct and indirect costs. In addition to the time needed to recruit and hire new workers, you are likely to incur lost productivity and frustration as experienced workers leave without transferring information to newcomers.

Today’s WMS are easy to learn and easy to use. Automating common warehouse tasks and introducing time-saving workflows makes it easier for employees to complete tasks. These automations reduce the risk for mistakes as employees work quickly to fulfill customer orders, while staying on top of production and inventory demands. Powerful features like directed put away, directed picking and shipping enable employees to become proficient as the tasks do not require as much knowledge or experience. Instead of taking a month or more to train warehouse workers, a WMS enables employees to work efficiently with only a few days of training. 

Cost Reduction/Cash Flow Improvements

  • Reduce turnover by giving employees the right tools for their job. Handheld RF and barcoding devices are more efficient and accurate than manual counts and spreadsheets.
  • Improve warehouse labor management with performance dashboards and KPIs.
  • Reduce the time needed to train employees by giving them time-saving, automated technologies.

Deploy the Right WMS to Support Your Unique Business Needs

The marketplace is fast-paced and crowded and customers are demanding. Don’t let inefficient warehouse operations be a drain on revenues, cash flow or customer satisfaction. Keep the pace in this digital era and strengthen customer relationships by integrating an SAP-Certified solution to your SAP Business One or SAP Business ByDesign system. Contact us for additional information and guidance as you choose the right solution to support your unique business needs. 

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