Why a Warehouse Management System is Vital for Your Business

by 2022-08-18

Importance of Warehouse Management System for Your Business

Maybe your dream of starting that skincare brand is now a reality, or maybe you get to use those fashion sketches you tirelessly worked on to make blouses that would give someone a boost of confidence. However, one of the many elements of running a successful business is effectively managing orders for your devoted customers and keeping track of the inventory of your products. This is where a warehouse management system (WMS) comes into place. Consider it the heart of your business. Everything that comes in and goes out is monitored, including inventory levels and customer orders, and the location of each item is documented before it departs so you know where everything goes at all times.

With the help of a warehouse management system, you can improve your company’s inventory management by getting rid of manual processes and reducing human errors in transport. You will also be able to monitor movement along with analyzing it so that there are no missing shipments or late deliveries! But before we begin, let’s take a closer look at what a warehouse management system actually entails.

Also commonly referred to as a WMS, a warehouse management system is a type of software that is frequently used by businesses to manage and oversee warehouse operations from the moment products or materials are delivered to the warehouse until they move out. A WMS can be used to optimize all aspects of your warehouse operations. You can track goods as they come into the warehouse, are loaded onto shelves and placed in various locations, and when they leave the warehouse for order fulfillment. A warehouse management system also provides accessibility to a business’s inventory at any time and location, whether it is on-site or in transit.

In this blog, we will be taking an in-depth look into the advantages of warehouse management systems for your business as well as the many kinds of systems for increasing warehouse productivity. Let’s begin!

What Makes Warehouse Management Systems Useful for Your Business?

A warehouse management system can help you expedite order fulfillment and keep track of what is selling well. Additionally, you can monitor the arrival of raw materials and make sure they are properly positioned for stocking and manufacturing. Having said that, a WMS will enable you to keep track of the ingredients (let’s use coconut oil as an example) being delivered to make your regular customers’ favorite refreshing face masks and scrubs.

Let’s now go into greater detail about the main advantages of a warehouse management system and why your company needs one.

Provides Real-Time Inventory Information

The data from a warehouse management system provides workers with access to inventory information whenever they need it. From the moment items are received in the warehouse, a WMS system can read serial codes and keep track of them. In turn, this accelerates the outward delivery process. The workload of businesses can be decreased with a warehouse management system. The business can avoid a physical inventory every year because of the real-time cycle counting capabilities of the WMS, which also provides information on the amount of stock in each location.

Lowers Operating Costs

Operating costs are significantly reduced, which is one of the main advantages of utilizing a warehouse and inventory management system. It assists in determining the most efficient use of both labor and space, reducing waste. Businesses can determine where to store specific goods, materials, and equipment to improve the flow of the warehouse using a WMS system. Some cutting-edge warehouse management systems offer floor stimulators that let users design potential floor designs directly within the system. They can set up shelves, pallets, and other equipment in the warehouse as needed thanks to these stimulators. Additionally, a warehouse management system provides enhanced inventory visibility. Due to the lack of storage requirements, this lowers just-in-time inventory for businesses and contributes to cost savings. A WMS can also cut waste by enforcing a first-in, first-out rule that ensures perishables that are the oldest are removed first.

Precise Billing Management

For this functionality, warehouse management solutions include built-in or third-party integrated billing management tools. With the help of this functionality, you can track all supplier-related activities and produce the appropriate fees using activity-based billing. Warehouse management softwaremay also connect to big eCommerce platforms and process credit card payments.

Amplifies Demand Forecasts

A warehouse management system can provide a business insight into potential future demand. It can improve inventory visibility, which can boost a company’s ability to estimate demand. Furthermore, a WMS can also gather data on the present outbound and inbound movement of materials as well as historical trends for a forecast. Warehouse workers can maintain ideal inventory levels when they have accurate information on demand forecasting.

Facilitates Ongoing Improvements

Warehouse management systems allow a business to continuously develop. Vendors of warehouse management software often launch new features to reflect the most recent industry best practices. On the basis of these developments, businesses are able to continuously enhance their operations by staying on top of new technologies.

Since updates can be made rapidly using a cloud-based warehouse management system, there may be less need for expensive, large IT teams. However, depending on the terms of their contract, companies using an on-premises system might or might not get regular upgrades from their vendors. This is the reason why many businesses are increasingly switching to the cloud.

Provides Quicker Product Delivery

It’s inevitable that customers today prefer and demand quick product delivery. Additionally, quick warehouse distribution is necessary for this to occur. The shipping procedure is accelerated by integrating a warehouse management system. As a result, your customers will receive their orders quicker and are more inclined to use your website or mobile app again.

Such management systems speed up the processing significantly. This is so that pickers can find the item easily. An automated method is used by a WMS system to locate, track, and send products swiftly. Additionally, it saves time because all the information is now updated automatically rather than using a cumbersome system.

Security is Improved

The majority of warehouse management systems demand that employees enter transactions using individual user accounts. This will establish an audit trail linking particular employees to particular transactions, lowering the possibility of theft and enhancing responsibility. Employers can also use it to find new training opportunities and other ways to enhance employee performance.

User-based access levels also shield some data and reports from unwanted access. Each user is only given access to the data that is necessary for their job.

Enhances Transparency

Transparency is one of the main advantages that warehousing and inventory management solutions offer. All employees can see every step of procedures like shipping, order fulfillment, and tracking in full transparency. Their employees can access real-time data and provide exact information to customers thanks to this transparency.

Improves Supply Chain

A warehouse management system’s principal functions include helping in the internal operation optimization of a warehouse, which has a ripple effect on a wider supply chain. The entire warehouse process, including inbound receipts and outbound deliveries, is streamlined by a WMS, lowering costs and boosting operational effectiveness. By removing or cutting back on unimportant or unproductive activities, warehouse staff can ship orders accurately and more quickly. Internal and external partners can benefit from these cost and time benefits by passing them along to their own business operations, along with enhanced processes.

Improved inbound receiving also cuts down on delivery time. As a result, this makes it possible for shippers to control inventory levels and delivery partners to more effectively utilize their resources and tools. Delivery time is shortened as a result of better inbound receiving. Thanks to this, shippers are able to control inventory levels and delivery partners can effectively utilize their tools and resources. Improved relationships with suppliers and customers are another benefit of high inventory visibility and supply chain management. Customers benefit from shorter lead times for deliveries, fewer order errors, and better order fulfillment while suppliers enjoy shorter wait times at docks and loading bays. The reputation of your business among customers and suppliers also grows when such measures are in place.

Boosts Employee Confidence

A warehouse management system can improve employee happiness and experience. Automating manual, repetitive operations in the warehouse with a WMS can boost employee morale. Because they can utilize their time more effectively, automation has the potential to increase employee satisfaction.

Even though a WMS solution can’t resolve every issue in your workforce, it may significantly reduce management’s and employees’ frustration. Your staff may take time to consider their actions before utilizing dubious equipment or attempting an improper lift in a more orderly and stress-free work environment. All of this contributes to a workforce that is safer, happier, and more engaged, which further boosts your company’s success as a whole.

It’s now time to look into the different warehouse management systems you can choose from to streamline your warehouse operations now that we’ve seen the major benefits of warehouse management for businesses and how it can advance your business.

Types of Warehouse Management Systems

Businesses implement four primary types of warehouse management systems to improve operational effectiveness and optimize their warehouse operations. These systems have a lot of similar features, but what sets them apart from one another is how they are delivered. It’s essential to first grasp the different types in order to select the best management system for your business’s requirements. Let’s discuss each of them in more detail.

Standalone Warehouse Management System

The most fundamental systems are standalone ones, which are only utilized for their features in warehouse management. These systems are only offered with the best and most important WMS module features, like inventory management and warehouse operations, and are sold without any additional supply chain functions. For smaller businesses, such as third-party logistics providers, which may not necessarily engage in full-scale manufacturing, standalone warehouse management systems are very beneficial.

Supply Chain Modules

One of the subcategories of supply chain management (SCM) is a warehouse management system. SCM software provides a wide spectrum of uses, helping users manage everything from business processes to relationships with vendors and risk assessment. It is predominately centered on automating tasks like product cycles, the management of inventory, and material sourcing.

While standalone solutions only cover warehousing and inventory management functions, the supply chain management warehouse platform offers complete control of the entire supply chain. It’s critical to reduce overlaps within your current software if you decide on this system. You might, for instance, combine software for inventory management, warehouse management, and fleet management into a single supply chain management warehouse platform if you already use those solutions. Choosing SCM software that is simple to link with other business software like ERP (enterprise resource planning) or payroll software is another strategy to prevent overlap.

Integrated ERP Systems

For businesses looking to enhance warehouse operations, an enterprise resource planning (ERP) system is regarded as one of the best options. For 3PL companies wishing to organize their supply chain, accounting, HR, and even customer relationship platforms, it is a great option. ERP is a specialized system that provides strong supply chain execution and stability. Although they may provide features for warehouse management, these systems are not an essential part of ERP. When considering purchasing ERP software, bear this in mind. Your processes can be integrated into a single user interface using ERP software, which can also replace a number of other software applications. ERP may be the option for you if you’re not happy with the software solutions you now use or wish to combine them into one system.

Cloud-Based Warehouse Management System

The ideal choice is a cloud-based platform for increased convenience and quicker integration. There are many advantages that cloud technology offers warehouses, including reduced IT maintenance, increased security, and lower costs. The management and integration of the WMS are relatively easier and more cost-effective with cloud-based systems because they are hosted on a server and system that are external to the business.

A cloud-based WMS has higher data security protocols given that it is hosted on a separate or private server. Businesses who manage high-value inventory or those that just want additional security in their WMS should be especially concerned about this. Regardless of volume, operational size, or complexity, this kind of technology can increase business productivity. Additionally, cloud computing provides free automatic software updates, which helps companies save costs and maintain technological competitiveness.

The Following Are Some Major Benefits of Using Cloud-Based WMS:

  • Quicker Implementation: Unlike on-premises systems, which take months or years to implement, a cloud-based WMS takes a matter of weeks. This is due to a cloud-based WMS vendor handling the configuration, hosting, and implementation.
  • User-Friendly: This kind of system is easier to use for your employees, the end-users. When the WMS system is simple to use and available to its regular users, warehouse operations can be more effective.
  • Continuous Improvement: Users of cloud WMS receive regular and routine updates as part of a continuous improvement model. This guarantees that you benefit from the new features and frequent upgrades at all times. Additionally, you are not obliged to update your system with the help of developers.The four primary types of warehouse management systems that you can select to enhance your overall efficiency and optimize your warehouse operations were just discussed. We will go over a few factors to consider in the next part when selecting the ideal warehouse management system for your business.

Choosing the Best Warehouse Management System

What you hope to accomplish in the long run will determine which WMS is best for you. Your business can cut costs by increasing productivity and accurately fulfilling orders with the right WMS. Here are some important factors to consider while choosing the best WMS for your business:

Budget/Return on Investment (ROI)

To assist you in establishing your budget, look over the benefits a warehouse management system provides. Your ROI should come in the following forms:

  • Cost savings from increased efficiency and better inventory management
  • Improved processes
  • Greater customer service, resulting in higher customer retention and revenue
  • Improved use of space
  • Elevated visibility and traceability


Be sure to research systems that can do the tasks that are most critical for your business. You’ll want the following functionalities:

  • Better equipment, labor, and utilization of space
  • Greater operational insights
  • Better picking, packing, and dispatch accuracy
  • Tracking the movement of inventory in real-time
  • Modern technology that includes RFID (radio frequency identification), serialization, barcoding, mobility, etc.


List the suppliers and products that best meet your needs and budget. Think about the following:

Do they possess knowledge of your industry?

Is their WMS fully integrated with their ERP solution or is it an add-on?

Are they accommodating and receptive?

Is WMS customization necessary?

What kind of training do they receive?

Compare the software offered by several vendors, noting all the features that cater to the requirements of your business in addition to cost, software licensing, training cost, support cost, and maintenance. Finding the best WMS can be done by watching a software demo and getting acquainted with the features it includes.

You can finally stop worrying about your supply chain.

With the help of FTx Warehouse, you are guaranteed to have a smooth run no matter what happens!

To Conclude

Your warehouse operations can be more effective, quick, and order-processing-friendly with the right WMS. In the end, this will save on operating expenses while boosting customer satisfaction and helping your business become more competitive. Looking to have these positive experiences? FTx POS will provide you with further information about FTx Warehouse, our warehouse inventory management tool that is designed to accurately track your inventory and automate your daily warehouse operations. Our highly qualified team of experts will take care of all your questions and assist you in setting up the automated warehouse management software for your business.

Danielle is a content writer at FTx POS. She specializes in writing about all-in-one, cutting-edge POS and business solutions that can help companies stand out. In addition to her passions for reading and writing, she also enjoys crafts and watching documentaries.

Danielle Dixon