Warehouses are built around numbers from the facility’s square footage to how many rows it takes for racking and stock keeping units. All these things must be considered in order build a professional warehouse that will process orders with speed while maintaining accuracy.
Warehouse management systems are a necessary evil for any business, but there’s more than meets the eye. In this article you’ll learn about some of what goes on behind-the scenes with these warehouses and how they affect your company in ways that may not be so obvious at first glance…
30% WMS In Warehouse
WMS systems can make your warehouse more efficient. In fact, less than 30% of warehouses are currently operating at peak performance!
Warehouse management systems (WMS) have been installed in over 600,000 warehouses across America. Of those few hundred thousand machines only 30% are efficient and WMS’s can be found at almost every major company’s distribution center or fulfillment hub today!
The 70% of warehouses that have been found to be “crime scenes” are not the type typically associated with bank robberies or homicides. However, these crimes do involve money lost and people getting hurt- just less seriously so than if it were at home!
You may be one of the 70 percent who process orders through an inefficient warehouse and doesn’t have a WMS system. Let’s look at some possible reasons why you’ve given for this decision not to implement one, starting with…
Your warehouse is not big enough
You’re not sure if your company needs a WMS system. You either don’t have enough people or orders to justify such an investment or IT staff aren’t interested in implementing this type of software on their own time and resources with limited success rates.
The reasons are endless, but your real reason is very likely a result of the next two numbers.
Investing in software up to 0,000 per year
When you invest in software, it’s easy for the costs to add up quickly. For example: a company would need between $100k and 500 thousand dollars just for their initial purchase of this type if programs – but those don’t even take into account all other expenses that can reach over one million!
Intangibles cost an average of 1 to 3 times more than software. Integration with existing ERP systems cavitated up 60% on the overall expense, so it’s important not only for WMS providers but also customers who wish integrate their new system into smoothly without too many hiccups in production workflows or customer relationships!
The high cost and complexity of implementing a warehouse management system (WMS) has been one reason why only 30% of all warehouses have made this investment.
However, there are other factors that contribute as well – like fear from investing in new technologies or worries about data security.
The main concern for many companies, when it comes down making changes at their facility is how much time they’ll need away from work, if something goes wrong with an implemented solution.
But these concerns should start fading away once more companies see what great results can be achieved by using smarter solutions such
220 WMS vendors
There are a lot of WMS vendors out there, but how do you know which one is right for your company? It can be tough especially, if they all seem so similar.
The good news: companies don’t have to take this burden on themselves! More often than not, businesses will contract with consultants, who specialise in working within the business software space (and having more experience doing just that) at an discounted rate or even completely FREE depending upon, what type(s)of service required by each client entity.
This makes decision making easy. Simply ask away until every question has been answered then make sure everything aligns before signing anything
Consultants are the best way to get an unbiased evaluation of your processes. They have no emotional ties in helping you improve what’s wrong with them, and can help save time by automating inefficient tasks!
Without a well organised warehouse, your organisation will struggle to function. The transformation from distributor of goods into an efficient distribution center can be challenging and takes time but it’s worth the effort for companies who want their businesses run smoothly!
The cost of fuel for your distribution center can be as high paying an expense, and in some cases even more valuable than the revenue that runs it. A $100 million organisation may have anywhere from 6%-20% ($6-$200M) worth on hand at any given time!
Your company’s success depends on the fuel that powers it: inventory. Other than people, nothing is more valuable to your organisation’s future growth and prosperity like raw materials or finished goods in storage right now!
Let me tell you how I calculate this number for my own business it has everything to do with cost-saving techniques which can help any company improve its bottom line while also increasing profits…
But first let me ask some questions: What exactly are we talking about here? What makes up “the value” at each stage of production?? And why should anyone care anyway??? Well don’t worry because after reading through these
Think about the effort your highest-paid people must exert to generate $2,500 worth of sales. For every dollar lost in inventory a company must create two new ones through increased revenue – it’s no easy feat!
Why are salespeople so much more expensive to hire than other employees? It’s because it takes five visits before they make a sale, and you only need three times as many customer contacts for retention.
You may think that salespeople are a headache, but in actuality they’re the backbone of any company. Without them there would be nothing happening – not only do their jobs inefficiently or effectively depending on what you need done at any given time; even things like inventory management will fail!
The number of different WMS systems out there can be pretty staggering, which is why it’s important to involve a consultant in order select one based on your current needs and future requirements. The next three factors about these kinds of software are also surprisingly high:
- Wheat fields with bustling harvest scenes
- An office filled with computers displaying charts/graphs etc
- All closely monitored by workers who need constant updates from their managers via cell phone texts or e-mails (just like real life).
Finally we have what looks suspiciously similar to Google Earth where planes fly overhead surveying land
Implementations rates in WMS: 30%, 42% and 56%
WMS implementations are not without risk. More than 30% fail, 42 percent within budget and 56%. The implementation can be delayed for many reasons but the key lies in knowing when it’s time to call all your shots!
When you consider the time frame for implementing and realising returns on your investment, it’s hard to see how WMS systems will ever be worth the effort.
The numbers don’t lie, and they say that you won’t see your million dollars for at least three years.
You might be waiting four years or longer for your return on investment. By then, the business model you started with may have changed so much that it’s time to invest in something new if this organisation exists at all – but don’t forget about what got us here!
The one piece of technology that can shut your business down is a WMS. Why? Because most organisations make dumb decisions without the assistance from an outsider, “you don’t know what you’re missing!”
Senior executives often make a bad decision when investing in WMS systems. One example is installing it at the corporate location’s distribution center first, instead of focusing on what will work best for them and their employees needs which could be different from those found among tons of other companies!
We all know how much time and money companies spend on their website management systems. But did you also realise that in some cases, these WMSs can be the reason for a company’s downfall?
Take Fox Meyer for example. They were able to get rid of its outdated inventory system but when it came down between using an external third party logistics provider or building its own software solution from scratch they decided against doing anything at all!
And Adidas wasn’t too far behind with Builders Plumbing Supply letting out an equally dramatic 20% drop after switching over their store fulfillment process last year due solely because everything was done through one tracking tool (WMS).
Warehouse Management Systems In Numbers
Justifying the Value of a WMS systems…
300 versus 1
You can reduce the number of errors your employees make with radio frequency scanning. This is because they produce one mistake for every three million scans, as opposed to 1 in 300 keystrokes when it’s not using this technology!
How does that compare? Well now think about what happens if you have an inventory list full up at receiving – RFID tags will help there too since all those extra details don’t need handwritten notes or manual checks anymore
The forklift travel time will be reduced by up to 50% with system-directed put away. Your employees spend about an hour a day searching for their storage location, which is eliminated immediately when you implement this process!
Picking accounted for 55 percent of warehouse labor dollars and picking processes consists mainly in going from one place all the way back again because there isn’t enough room on site that can hold everything at once, but with our new picker robots we may finally have found some answers
With our experienced team of professionals, you can expect to receive as much 35% reduction in operating expenses.
With automated systems, the cost of carrying inventory can be as much as 27% less.
WMS systems help increase inventory accuracy by about 20%.
Shipment accuracy improves around 5 percent.
Implementing the system will allow you to go live without performing an additional wall-to-wall physical inventory six to eight months after implementation. Anyone who says that you can have a successful business without taking one is nuts, and they should really think about their statement because it sounds silly!
Once the learning curve is over and everyone understands how important it is to maintain an accurate inventory, no one will ever need physical inventories again.
In this day and age, customer expectations are high. Your customers have too many supplier options but they also know that you can’t always meet their needs for the best price so it’s important to stay on top of what people want now while offering improvements in order come back later when there is more demand or else risk losing potential clients forever!
Warehouse management systems are the key to success in any business. They provide a number of benefits for your company, including improved inventory control and order fulfillment rates. More efficient distribution methods through transportation tracking software or mobile devices that connect directly into the system, saving you time when picking orders from throughout warehouse space as they’re delivered right next door!