Warehouse management sounds like a complex thing, but in short, it’s quite simple: the right product, at the right place, at the right time and with zero errors. Now this is achievable on a large scale with the support of the modern warehouse management system (WMS).
What is Warehouse Management?
Warehouse management is a collection of processes, practices and systems to efficiently and accurately receive, store, organise, pick, pack and ship products.
It involves:
- Tracking inventory: tracking what you have, where it is and when it expires.
- Optimizing the use of space, labour, and equipment
- Safety: Protecting employees’ safety and product integrity
- Compliance: Compliance with regulations (GST, food safety, pharma norms, etc.)
- Cost control – reduce the cost of operating the site
What is a Warehouse Management System (WMS)?
A warehouse management system (WMS) is software designed to manage and optimize warehouse operations. Today’s WMS systems support your ERP, optimize picking routes, offer real-time inventory updates and give you visibility of your supply chain.
Core WMS Functions:
1. Receiving & Put away
- Read the barcode/RFID when coming in.
- System optimizes displacement of goods to the most appropriate storage area
- Eliminates up to 95%+ manual data entry errors
2. Inventory Management
- Stock level real-time monitoring
- Automatic low-stock alerts
- First in First out (FIFO) expiry Optimisation.
- Reduces shrinkage by 15-20%
3. Order Picking
- The system creates optimum picking routes.
- Batch Picking and Single Order Picking options.
- Mobile terminals are used for operators’ guidance.
- Saves 30-40% on picking time
4. Packing & Quality
- System checks the right products that have been retrieved
- Scales verify weight accuracy
- Minimises the number of wrong-shipment errors to almost zero
5. Shipping
- Automatic label generation
- Carrier integration (real time rates)
- Real-time delivery tracking and proof-of-delivery record
- Enhances on time delivery by 10-15%
Main Functions of Warehouse Management
The main functions of warehouse management are:
1. Receiving & Putaway: Goods move from the staging area to assigned storage locations after barcode scanning and system verification.
2. Pick and Pack: The operator scans the item to be picked or placed on the rack, the system reports the exact location, and the operator places the item in the correct bin/rack.
3. Inventory Control Real-time view of stock levels → automatic alarms for low levels of stock cycle count planning and shrinkage avoidance.
4. Order Picking System: picking list is created and operator scans the items, system verifies and items consolidated to shipping area.
5. Packing & QC: Items are weighed to check accuracy, labels were generated, packages were sealed and then scanned to be shipped.
6. Shipping: Generate shipping manifest, book shipping, load, track and provide proof of delivery to the carrier.
How WMS Improves Warehouse Efficiency
Warehouse management systems enhance warehouse efficiency in a variety of ways.
Manual Operations: Before WMS:
- Time to complete an order: 3-5 hours
- Error rate (wrong items and quantities): 3-5%
- 70% warehouse space utilization
- Labour intensive (number of operators)
- No real-time visibility
With WMS:
- 30-45 minutes to complete an order (90% quicker)
- 0.1-0.5% error rate (99.5% accuracy)
- More efficient space utilisation (85-95% space utilisation)
- 40-50% labour reduction (automation)
- Complete end to end real-time visibility
Financial impact: ROI for WMS can be expected in 2-3 years, and operational benefits of 20-30%.
Challenges in Warehouse Management (& Solutions)
Challenge 1: Workforce Fatigue & Labour Challenges Excessive repetition of tasks, low wages. Solution: Automation (conveyor, AGV), improved compensation, training opportunities.
Challenge 2: Space Constraints In metros, high cost of real estate. Solution: Vertical storage (high rise racks), automated systems maximise space.
Challenge 3: Inventory Accuracy Manual counting = errors. Solution: Barcode/RFID tracking, WMS cycle counting, real time tracking.
Challenge 4: Expiry Management Losses due to perishables going out of date. Solution: FIFO in WMS, automatic expiry alerts, temperature-controlled storage.
Challenge 5: Integration with ERP Systems not communicating. Solution: Modern WMS can seamlessly be integrated with ERP (SAP, Oracle, etc.).
Inventory Management in Warehouses – The Key to Success
Warehouse operations are all about inventory management. When companies don’t manage their inventories well, it costs them millions:
Common problems:
- Dead stock – Capital tied up in stock which nobody wants
- Stock-outs – Loss of sales from items out of stock
- Shrinkage – Inventory losses caused by theft, damage, or misplacement
Best practices:
- Regular cycle counting – WMS tracks counts automatically
- ABC analysis – focus on high value items
- FIFO rotation – especially important for food, pharma and chemicals etc.
- Regular audits – quarterly physical counts are recommended.
- Expiry date management – WMS gives automatic alerts.
- Damage Reporting – immediate documentation.
WMS Technology Stack – What’s Available?
- Basic WMS: ₹2-5 lakhs (cloud based WMS)
- Mid-tier WMS: ₹10-30 lakhs (customizable WMS)
- Enterprise WMS: ₹50 lakhs-2 crores (full automation integration)
Popular Options:
- SAP Extended Warehouse Management
- Oracle
- Dynamics 365
- Specialized Platforms (Fortna, Manhattan Associates)
Key Takeaway
A successful warehouse management system needs three things: good processes, quality equipment (forklift trucks, conveyors and racks) and modern WMS software. Together, they can establish efficient, accurate and scalable operations.
Looking to construct a warehouse or enhance your operations? With its consultation and equipment from Mazda Movers, get a seamless warehouse material handling and operation when dealing with WMS integration.
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