A warehouse is the heart and soul of any business, like most companies, there’s a lot of investments held within. The warehouse itself is a huge investment, so knowing how to optimize your warehouse and products are paramount.
If you have a badly managed warehouse, you’re going to run into a lot of different problems, all of them eat away at profits.
- Can’t access inventory and equipment
- Poorly managed teams and employees
- Counterintuitive warehouse processes
- Bad layouts that cut down on productivity
As you can imagine, yes, these are no good for your business. If warehouse operations aren’t in order, it becomes difficult to serve customers, vendors, and your own organization. Smart warehouse management, particularly the right warehouse management software (WMS), lets you do more while working less.
While you’re going to save time, money, and energy, you’re also going to be more profitable. What would you do with the extra money this would save you? You’re going to have more time and money to focus on the growth of your business.
While our audience knows what a warehouse is, for our new users, it’s defined like this.
“A storage facility within a warehouse management system that is part of a supply chain. The warehouse is located in the most centrally located position to afford a shipping agent the ability to temporarily house shipments for distribution to other warehouse facilities or the final shipping destination.”
Now, let’s get into warehousing and everything you need to know.
What Is Warehousing?
Warehousing is the process of storing inventory where products can easily be found and tracked before they are sent to order fulfillment. Afterward, they could be sent to smaller warehouses or retail brick and mortar stores.
Small retailers and merchants that don’t have a lot of capital to invest in their own warehouse often find creative ways to store inventory. For example, they could be using a room for inventory, renting lockers, even storing inventory in a home or garage.
What Is Warehouse Management?
Warehouse management is all about oversight of warehouse operations. This can involve inventory receiving, tracking, or storage, as well as training staff, managing shipping, workload planning, and monitoring how goods are moving.
Warehouse Management Systems
A warehouse management system (WMS) is software that’s developed to optimize operational processes in a warehouse. Without a WMS, you’re going to struggle to have full visibility into real-time inventory levels and storage, staff productivity, demand forecasting, and order fulfillment workflows within a warehouse.
One of the biggest benefits to warehouse management systems is the fact that it eliminates the guesswork and manual processes you’re using now. With a WMS, you’re going to streamline your processes, allowing you to save priceless time and have an accurate count of what’s going on inside your facility. Instead of spending the time to perform warehouse audits, your data is going to be there to give you a clear picture of what’s needed and what to do next.
These insights are what allows warehouse managers to find areas that need improved and allows you to track progress so you can optimize your supply chain.
Warehouse management software gives you the tools you need to strategize for performance and track day-to-day operations. What a management team sees in the warehouse management system will be different from a picker or packer who relies on the system to know what to pick or pack next on the warehouse floor.
Now, it’s important to note, all warehouse management systems are not created equal. Some WMS will have different features and functionality based on the industries they serve. may have different functionality deployed depending on the business it serves (e.g., what a direct-to-consumer ecommerce seller needs isn’t the same as a large brick and mortar store chain).
Key Warehouse Management Processes
Warehouse management is one facet of supply chain management. It affects retail order fulfillment, storage, inventory management, shipping, and distribution. Having an all-in-one solution lets you see what’s happening across different functions of the warehouse in real-time such as inventory being received, orders being packed, shipments being labeled, and any other movement of goods.
Inventory tracking refers to monitoring stock levels so you know which SKUs you have in your warehouse and exactly where you store them. It also allows you to monitor products in transit, from a manufacturer or en route to a store.
On the other hand, Inventory management lets you know the status on product as customers place orders, also informing you when you should order more based on projected volumes.
As your company grows, you’re going to have quicker inventory turnover, expand into new locations, and increase product lines. This is why accurate inventory and tracking is vital to your success.
Picking And Packing
Picking and packing refers to specific functions that are performed in a warehouse. A warehouse management system can create pick lists for each picker to retrieve items in an efficient manner. This may include batch picking, zone picking, or wave picking.
When a new order is placed, the picker receives a packing slip of items that were ordered and storage locations at the warehouse. The picker has the tasks of collecting all of the products that were ordered.
When the order has been picked, it will be then be passed to a packer. The packer is responsible for packing the order, ensuring it’s secure and accurate. The packer may use a box or poly mailer, as well as adding packing materials, and lastly putting a shipping label on it.
Receiving And Stowing
All warehousing operations need to have the ability to receive inventory or freight from trucks at loading docks and then stow them away in a storage location. A warehouse management system can be used to scan each new box received with the inventory quantities it has.
Once that is done, the inventory is placed in a short-term or long-term inventory storage location, where it will be scanned again. WMS would provide the instructions for each employee so they know how to receive, unpack, retrieve, pick, pack, and ship inventory.
There’s a lot of different delivery options and shipping services you can offer to customers:
All of the shipping carries above will pick up orders from the warehouse to ship packages to their next destination. Once the order ships, your warehouse management system should be able to automatically send ecommerce order tracking information back to your store, which allows your customers the opportunity to track their own orders.
Reporting And Analytics
A WMS should provide you with operational and inventory reports across your whole warehouse. This may include accuracy in fulfilling orders (total mis-picks, mis-packs, etc.), total orders fulfilled by the hour to measure efficiency of staff, orders shipped on time, and much more.
Most WMS providers have reports that include inventory forecasting so you’ll have the opportunity to understand staffing and labor management. With a warehouse management tracking system in place, you can easily find out which employees have completed safety training, see which have licenses and certifications to operate certain equipment, and other regulatory requirements you may run into.
Why Warehouse Management Is Key To Ecommerce Success
If you’re experiencing growth and fulfilling orders in an ecommerce warehouse, you need proper warehouse management and oversight in place. This requires experienced experts to manage the warehouse along with the tools and facilities to support not only your volume today but projected growth as well.
Growth, Growth, Growth
Yes, something every business owner wants, a successful growing business. While growth can be an exciting time, it also brings new challenges to the organization. Many of these challenges are going to be focused in one area: fulfillment logistics. Some of the fastest growing brands in the market today realize the important impacts of warehouse efficiencies, from dock door counts to properly using warehouse space.
While it can be your warehouse management team that needs to choose the right technology, shipping carriers, delivery options, and security, company owners have the most stake to in this venture. You can quickly outgrow your space, so you always have to be two steps ahead.
Packages Are Processed And Shipped Faster
Warehouse management makes operations leaner and more efficient. Stations are designated in each area of the warehouse for each step of the fulfillment process (e.g., separate areas for warehouse picking, packing, labeling, returns, etc.). Each fulfillment associate is focused on one task per shift to maximize their output.
Setting up each functional area for success also means reducing the physical steps needed to get from one place to the next and routing everything in a streamlined way. The faster all of this work is done, the sooner packages are ready to go out the door.
High Performance Storage Allocation
Efficient warehouse management is going to help you store SKUs in the right locations of your warehouse (think shelf, bin, pallet, etc.). Once the inventory is in the right place, a warehouse management system helps pinpoint the exact location of any SKU. Having a process like this is key to getting products accurately shipped to customers.
This will also help you keep a close eye on real-time inventory levels, which is critical so you know when to put your resources to work. This is especially true for those of you that sell products that expire.
Warehouse Management With A 3PL
Let’s talk about 3PL warehouse management and why it can transform your business and help you take it to the next level.
Warehouse processes can be both complicated and expensive, this is why many of these brands outsource their entire fulfillment process to a third-party logistics (3PL) company.
Now, this is not your on-demand warehousing company that finds warehouses with extra space so you can use them. Rather, these 3PLs run their own fulfillment centers and have standardized warehouse management across all of them. Here at Thill Inc., we’ve been operating and managing warehouses for 50+ years. We proudly work with some of the biggest brands in the world, but we also work with smaller companies that are growing.
Yeah, we had to get that plug in, but there’s a ton of advantages you get working with a professional logistics company to store inventory and ship orders.
Optimizing Your Logistics
3PLs work with thousands of companies — including seasonal brands, high growth brands, and everyone in between — so they have a lot of data and can do everything from analyzing shipping zones to forecast demand and inventory. Continuously aggregating and learning from data helps optimize each warehouse for greater efficiency as well as provide reduced shipping costs and transit times for your customers, all of which help you grow.
Multiple Warehouses And Geographical Strategies
When you run your own warehouse, you are only shipping from that one location. Partnering with a 3PL means you can store inventory in several of their fulfillment centers to keep inventory closer to more customers. If you ship nationwide, it’s a must that you have warehouses coast-to-coast.
For example, Thill has a presence in the largest US cities and regions all over the United States, so you can ship orders via ground to large populations very quickly. This helps meet customer expectations around 2-day shipping by reducing the distance traveled and delivery timelines.
Time Is Precious
Time is precious and as you know, you can get your time back. Ecommerce order fulfillment services from a 3PL can help you eliminate time-consuming logistics tasks. Think about it…
- Order Tracking
- Inventory Storage
Running a warehouse can be stressful too, so there’s a lot of relief when all of those factors are off your shoulders.
The best part, you can monitor their performance and use the data analytics they collect to make better business decisions.
Utilizing Warehouse Space
If you do have a warehouse and you’re running out of space, partnering with a 3PL can make life and business a lot easier. Even though you outsourced fulfillment to a 3PL, you can still utilize your warehouse space. That space can be transformed to focus on a different aspect of your business or you can lease it out.
In fact, a 3PL can help you pay for only the space you need, even if that’s by the bin, shelf, pallet, or any combination of those for your products. That way, you’ll never have to worry about outgrowing (or never growing into) the space you’re paying for.
There’s a number of different ways you can leverage newly found warehouse space.
We always recommend real-time data, it’s priceless! Even if you’re not working inside the 3PL’s warehouse, that doesn’t mean you can’t find out what’s happening. Here at Thill Inc., our order management software allows you to see your inventory flow, including when inventory is being received, stowed or put away, picked, packed, shipped, and other movements.
With our warehouse management software, you can search orders by tracking number, destination country, the number of items it contains, filter by sales channel, fulfillment center location, as well as get full transparency into performance such as fulfillment speed, orders fulfilled on time, accurately, claim-free, and much more.
3 things to look for in your next warehouse management system
If you are set on managing your own warehouse, make sure you do your due diligence and get a warehouse management system that works for your business’s unique needs.
Outsource your warehouse management with Thill Inc. today!
If you aren’t looking to manage your own fulfillment warehouse and license a warehouse management system, but you are interested in outsourcing inventory storage and ecommerce fulfillment to a 3PL, check out Thill.
With a network of fulfillment warehouses all over the United States and free proprietary warehouse management software that’s completely tailored to Thill’s processes (unlike other 3LPs that purchase their own warehouse management system from other companies), ecommerce business can leverage economies of scale, discounted shipping rates, fulfillment services, and support, all without having to invest in the individual pieces that comprise warehouse management.