What is Warehouse Putaway Process? Best Practices To Be Adopted For Optimizing Warehouse Putaway Process in 2024
Warehouse managers have consistently identified the warehouse putaway procedure as one of the significant causes of warehousing inefficiency throughout the years. The putaway technique utilized by many warehouse managers evaluated was incredibly inefficient. To improve the pick-pack-ship process and protect the security of goods, equipment, and workers, warehouses must have a precise and effective warehouse putaway procedure. A warehouse is always in motion from when an order is placed until it is sent. Therefore, getting putaway properly might be crucial for your company because it's one of the most necessary warehousing procedures. The many putaway tactics, their advantages, and how a 3PL may aid in enhancing warehouse inventory management will all be clarified in this article. What is Putaway Processing in Warehouse? Source Putaway in the warehouse is an essential part of warehouse management, which includes a number of procedures beginning with receiving in the warehouse and concluding with ensuring that inventory is kept in the proper warehouse locations. However, it involves much more than merely transferring the stuff from place A to place B. It becomes considerably more effective and straightforward to store goods without losing any SKUs with a systematic warehouse putaway system. Additionally, this procedure enhances warehouse organization and makes it simpler for pickers to locate the required SKU fast. [contactus_lilgoodness] Types Of Warehouse Putaway Process Although the warehouse putaway process(from dock to stock) may appear like a straightforward procedure, it has to be carefully planned because it is an essential part of storage. You might select one of these three kinds of warehouse putaway based on the kind, amount, and diversity of physical goods you have as well as other distinctive aspects of your company: Source Fixed Position Putaway Retailers who need to store a wide variety of products in the warehouse and want them to be accessible to customers may adopt this procedure. A distinct warehouse area designed for storing each type of commodity is allotted to it. For instance, preserved food will always be kept in a space with a regulated temperature. Additionally, heavier items will be housed in the bottom racks of the warehouse, while lightweight items can be held on the higher shelves. Dynamic Putaway Do you have a uniform mix of products? Are their physical attributes—size, weight, etc., similar? For that, pick a dynamic putaway to simplify stock retrieval and storage. Demand management is prioritized as judgments are made in real-time regarding where to put incoming inventories. Depending on the number of their sales, the items must be housed in the most accessible areas for quick collection as soon as they enter the warehouse. On the other hand, keeping track of the items is more challenging without a robust tech-powered ERP like warehouse management software because they are stored in new locations every time. Direct Putaway Direct warehouse putaway necessitates the least amount of product handling. Straight putaway, you may store the entire batch in a designated area without going through each item. For instance, putting the order away makes more sense than separating and storing each product if it is only for one buyer. Factors Affecting the Warehouse Putaway Process Depending on these three key elements, you should pick one of the putaway methods: Putaway Considering Movement Order fulfilment times may decrease by using ABC analysis to store things based on movement. Fast-moving goods, referred to as "A" categories, should be maintained close to the staging area and at an appropriate height so they may be picked up and prepared for shipment immediately. Similarly, "C" category items that move slowly should be stored towards the back of the warehouse. Putaway Based on the Kind of Package Products can be stored using this strategy based on their package. For instance, regardless of the type of goods, pallets and individual products can be stored in various places. Similar distinctions can be made between shipments depending on weight, shipment type, storage needs, and more. Utilization-Based Putaway Several goods are frequently combined, such as gas stoves and kitchenware. Employees can streamline the warehouse putaway process by grouping these goods according to their usage and the reasons they are being transferred. Benefits Of Warehouse Putaway Process An effective warehouse putaway procedure may result in less expensive and speedier outbound operations. A warehouse can gain the following main advantages by employing a planned and efficient putaway process: Optimizes The Layout Of The Warehouse You may make the most of your available retail warehouse space by adequately planning the workflow of your putaway procedure. It is simpler to keep things where they belong by grouping items of the same shape and size together and separating them based on various factors. By doing this, you may avoid disorganized inventory management that can limit warehouse employees' freedom of movement and ability to complete timely picking and packaging. Enhances The Selection Process Pickers wander about the warehouse for more than half their typical workday, looking for the items on their order. Travel can account for 50% of the picking time and another half of the total labour cost. They may significantly save the time it takes to look for items and complete an order by putting a solid warehouse putaway process in place. A practical choice procedure is unquestionable. Accurate Inventory Management Human mistakes and inaccurate inventory management systems can be expensive for the company. In the warehousing business, the typical picking mistake rate ranges from 1 to 3 per cent. This translates to an average cost per inaccuracy and a profit drain of up to 15%. You can accurately track where each product is, how much there is, and many other things when you have a putaway procedure. Additionally, it lessens the likelihood of losing or misplacing an item. Increasing Stock of High-Value Products Stocks of high-volume items can be increased by keeping them in an area that is simple to access and keep track of. Additionally, it stops pickers from repeatedly searching the warehouse for a specific item and delaying order fulfilment. You'll be able to tell right away whether the stock is falling. Suggested Read: Smart Warehouses Management System Best Practices to be Adopted For Optimizing Warehouse Putaway Process  When improving warehouse operations, warehouse managers frequently overlook the putaway process, even though it is a crucial step in raising warehouse productivity. The selecting process, in particular, is directly impacted by the initial arrangement of the products in the warehouse. Travel and picking and packing times are longer when things are not kept in the most convenient place. The security/integrity of the cargo and the employees' safety are also at risk when cargo is not stored in the most advantageous position. The best practices and technology that warehouse managers may employ to enhance the warehouse putaway process and boost warehouse productivity in year 2024 are listed below. Collect Data and Report Analytics In Real Time Data is king when it comes to optimizing warehouse operations and putting in place a productive putaway procedure. Data on order/sales volume, storage availability, cargo category (e.g., Hazmat, perishable, high value, etc.), cargo size, weight, and height must be recorded regularly to determine the ideal storage site. As a result, two essential components of the warehouse management system (WMS) are required: sufficient and flexible data collecting capabilities and ongoing data analysis. The next stage is ensuring that we are collecting data reliably and effectively by automating warehouse collection as feasible after the relevant WMS is in place. This will enable us to eliminate entry mistakes and cut back on overhead. For instance, an integrated digital weighted scale may collect cargo weight data, while a package or pallet dimensioning system can gather data on dimensions. Both approaches automate these processes and do away with data entering mistakes. Keep an Eye on Space Availability and Storage Capacity By keeping an eye on storage capacity and availability, saving wasteful journey time to places with an insufficient room or ability to store the cargo and boosting warehouse efficiency is possible. To monitor capacity and space availability, warehouses may track used/unused space throughout warehouse zones using barcode scanners and bin positions. Currently, the majority of warehouse management systems support this method (WMS). This system, however, is vulnerable to human error since it depends on the warehouse clerk to scan the position of the bin and the contents each time they complete a putaway or pick action. The use of RFIDs to automatically record tasks without human interaction is another strategy. The usage of RFIDs in conjunction with more sophisticated solutions, such as sensors, will be part of an ecosystem of technologies to enable real-time tracking of capacity and space within the warehouse, even if this solution is still being adjusted and tested. Shorten Travel Time Another crucial element in streamlining warehouse operations, including the putaway process, is cutting down on travel time. Again, the aim is to reduce the time for items to transit from the receiving region to the storage site. Warehouse managers may perform an ABC analysis to comprehend high volume/frequency cargo better. Then, to cut down on trip time, the warehouse layout should be modified (if required) to bring high volume/frequency goods closer to shipping locations. For this to work, it's critical to continuously monitor order volume and frequency and adjust when significant alterations occur. Another option to reduce travel time is to designate routes that take the quickest way to the storage site. Warehouse managers should consider things like distance, warehouse traffic jams, and potential conflicts with other procedures that need movement. When Possible, Utilize Direct Putaway Process In Warehouse Whenever feasible, employ straight warehouse putaway as another great practice. With this technique, no staging phase is involved in moving the goods from the receiving region to the final destination. This method expedites the procedure while requiring less handling and warehouse space because it does not require specific staging areas. When putting this strategy into practice, it's critical to remember that the WMS must be able to assign final locations from the point of delivery at the receiving dock or from the advance shipment notice (ASN). Without this ability, it is nearly hard to manage an efficient straight warehouse putaway operation. Use Both Fixed and Moving Locations If the circumstances permit, utilizing a balanced combination of permanent and dynamic locations is also conceivable. A fixed placement is a predetermined storage area, warehouse zone, lane, or bin designated based on specific criteria. For instance, a fixed location may be connected to a particular client, product category, or end destination. Because warehouse employees can remember the precise position assigned to each container, fixed locations help the operation run more efficiently. Dynamic locations, on the other hand, offer greater flexibility since they let employees place anything in the first empty spot they come across. A trustworthy inventory management system is essential when employing dynamic locations to track products and locations. Additionally, high-volume seasonal products can be temporarily stored close to pickup sites using dynamic placements, and when volumes change, they can be swapped out for another item(s). Keep Warehouse Clean and Organized Lastly, an effective process might depend on having a tidy and organized warehouse and distribution centre. A crowded and disorganized facility will directly impact the pace at which items are stored. To get to the intended place, clerks must first discover suitable spots, shift freight to make room for it, and negotiate barriers. Most significantly, disorganized warehouses put workers at greater risk for injury and raise the possibility that the integrity of the cargo might be compromised. Streamlining your warehouse procedures or utilizing the newest technologies won't help if your warehouse isn't clean and orderly. Conclusion The warehouse putaway process is equally critical to the warehouse as picking, packing, and shipping. It remains, nonetheless, one of the most overlooked features of the warehouse. Businesses that don't implement an efficient warehouse putaway procedure may encounter various issues, including decreased production, product losses, ineffective inventory management, and more. Warehouses and fulfilment centres cannot afford to adopt a complacent mindset and allow process inefficiencies to impact productivity negatively and, in turn, the customer experience in today's fast-paced and always-changing consumer market. Therefore, there is a more critical requirement for constant visibility and data-driven business advice to make all fulfilment operations error-free. How Can WareIQ Enhance The Putaway Process In Warehouse With technological solutions, WareIQ assists e-commerce businesses in optimizing putaway and other warehousing procedures. Our distribution and fulfilment services make monitoring warehouse KPIs incredibly simple and expedite the warehouse putaway process. This increases your company's capacity for inventory optimization. Additionally, our clients have access to a network of fully functional distribution facilities, complete with staff and other services for warehouse management. The technology, support, and expanding distribution network made possible by WareIQ's warehouse network system enables retail enterprises to scale. [signup] Warehouse Putaway Process: Frequently Asked Questions (FAQs) How does the warehouse putaway strategy work?A putaway system employs rules to move things from a received shipment to the appropriate locations in warehouses. As a result, items are kept in the appropriate places in accordance with their storage condition needs. What distinguishes warehouse storing from warehouse putaway?Direct putaway is the act of moving a newly received product right away to its ultimate destination in your warehouse. As soon as things come, you get ready for distribution rather than storing them. Define the warehouse putaway plan.You can maximise warehouse space, resources, and product quality with the use of a putaway strategy. You must use an inventory storage system to account for the projected receipt and the present backlog in order to determine how many resources and how much space will be needed for the putaway. Can technology such as RFID or barcode scanners be used to improve the warehouse putaway process?Yes, technology such as RFID (radio-frequency identification) and barcode scanners can be used to improve the warehouse putaway process. RFID tags and barcodes can be attached to inventory items and used to track their location and movement within the warehouse. This information can be used to optimize the putaway process by helping to ensure that items are stored in the most efficient locations and making it easier to locate items when they are needed.In addition to tracking the movement of inventory, RFID and barcode scanners can also be used to automate the putaway process by providing real-time updates on inventory levels and alerting employees when items need to be restocked or moved to a different location. This can help to reduce the time and effort required to put away inventory and improve overall efficiency in the warehouse. How do I train my employees on the warehouse putaway process?Some suggestions for training your employees on the putaway process include: creating a training program that covers all necessary steps, using visual aids such as diagrams or videos, providing hands-on learning opportunities, offering ongoing training or refresher courses, and giving feedback and support to improve skills and efficiency.
July 30, 2022
How to Improve Regional Utilization and Optimise Demand-Based Inventory Distribution in 2024 for Faster eCommerce Fulfillment with Accuracy & Lower Inventory Holding Costs?
Brands must provide faster deliveries and effective order fulfillment as competition in the eCommerce sector heats up. It is essential to be able to predict demand effectively and keep inventory levels in line with consumer demands. The amount of time it takes an eCommerce business to deliver an item to a customer's door has a significant impact on how customers perceive a brand. It is essential for both small and large businesses to fulfill orders quickly and accurately if they want to grow their eCommerce consumer base. Smaller brands must increase their consumer base through flawless order fulfillment while larger companies and international brands must preserve their brand reputation and existing customer base. To make delivery quicker and more cost-effective, eCommerce businesses are practising regional utilization. Optimizing regional utilization can help ecommerce businesses reduce shipping costs, improve delivery times, and increase customer satisfaction. It can also help businesses better manage their inventory and reduce the risk of stock-outs or overstocking. Let us get a better understanding through this article. What is Regional Utilization? Regional utilization (RU) is an eCommerce calculation term which reflects the percentage of local and zonal order fulfillments out of the overall order fulfilment. It is a measure of how well the fulfillment center is able to meet the demand for orders within a specific geographic area. Giant eCommerce players consider regional utilization (RU) as a significant factor in determining the seller account status. Electronic brands and sellers often prepare their stock for some of the most awaited eCommerce season sales like Amazon’s Great Indian Festival or Flipkart’s Big Billion Day. Regional utilization (RU) ensures faster delivery and reduces additional logistic costs. [contactus_lilgoodness] How to Calculate Regional Utilization? To calculate regional utilization, you will need to gather data on the volume of orders being placed in a specific region and the efficiency of your fulfillment center in servicing those orders. Here is an example of how you could calculate regional utilization: Gather data on the volume of orders being placed in the region. This might include the number of orders placed per day, week, or month and the average order size.Gather data on the efficiency of your fulfillment center in servicing those orders. This might include the number of orders being fulfilled per day, week, or month, as well as the average time it takes to fulfill an order.Calculate the regional utilization rate by dividing the number of orders fulfilled by the fulfillment center by the total volume of orders placed in the region. For example, if your fulfillment center is fulfilling 1,000 orders per month in a specific region, and the total volume of orders placed in that region is 2,000 per month, your regional utilization rate would be 50%. This means that your fulfillment center is fulfilling half of the orders placed in the region. The following illustration shows the regional utilization (RU) formula: Let's see, with the help of an example, how regional utilization (RU) is calculated. Suppose you have 10 fulfillment centers across India and the following factors are at play: You received 25 total orders in the month of July, 5 from New Delhi, 5 from Mumbai, 5 from Bangalore, 5 from Pune and 5 from Chennai. Out of 25, you managed to fulfill 15 orders locally. Therefore, your regional utilization (RU) = 10/25 X 100 = 60% Why Should an eCommerce Business Figure Out Their Regional Utilization? Businesses calculate regional utilization (RU) for a variety of reasons, including: To Get Faster Order Fulfillment When inventory is stored in close proximity to your customers, their orders can be fulfilled at a faster rate due to the less amount of distance that needs to be traversed and less time needed to travel that shorter distance. For instance, if your company has fulfillment centers located in Mumbai and Pune and you get the majority of your orders from those 2 cities, fulfilling orders will be much faster than if your fulfillment center was located in Nashik. To Achieve a Lower Amount of Returns If there is an unforeseen delay in the fulfillment of an order or delivery timelines are generally longer due to the physical distance between the fulfillment center and the customer, there is a higher chance of customers initiating a return. When businesses take advantage of regional utilization, they reduce the wait time that customers have to endure and thus, reduce the number of returns that are initiated. To Save on Shipping Expenses By making use of regional utilization, you can save immensely on your shipping costs because prices increase along with distance and if the distance is shortened due to goods being located to the customers that order them, shipping expenses automatically decrease. To Increase Profit Margins Regional utilization not only reduces shipping and logistical expenses, it also increases the efficiency of fulfillment operations, including saving money on returns management. All these elements when put together lead to an overall increase in your company’s profit margins. Some more important uses of regional utilization are listed below: Finding the inventory allocation across the country according to demandCreating a successful strategy for effective deliveriesChanging to a low-cost shipping moduleIncreasing product visibility better helps your seller account on online marketplaces to perform better Reducing RTOsIncreasing customer satisfaction by meeting their expectationsOffering same-day deliveryStoring different inventory items at different locations as per their order volumes 7 Ways to Improve Regional Utilization & Optimise Demand-Based Inventory Distribution in 2024 To improve regional utilization (RU), eCommerce businesses can adhere to 6 methods mentioned below: Keep Warehouses at Multiple Locations A centralized warehouse is easy to manage, but it increases the cost and delivery time, affecting your revenue and customer satisfaction. It is always better to have decentralized inventory at multiple warehouses across the country to reach customers faster, that are located in any nook and corner of the country. Use a Demand-Based Inventory Model Source Instead of keeping all of your inventory in a single warehouse, consider using a demand-based inventory model that allows you to store inventory closer to your customers. This can help reduce shipping times and costs, and improve regional utilization. Have a Trained Resource Pool of Warehouse Operations & Delivery Personnel Trained human resources in warehouse management & last-mile delivery can make regional utilization easy, as they will ease operations and smooth your delivery processes. They can personally handle any task with great effectiveness. Opt to Partner with 3PL Partnering with a trusted 3rd party logistics company helps you to take more and more orders and then easily fulfill them. A few fulfillment partners come with the feature of same-day and next-day delivery and have micro fulfillment centers scattered across the country, which increases regional utilization. Never Risk Stock-Out of Inventory Always keep a minimum amount of inventory with you to deliver orders swiftly instead of risking stock-outs. MOQs, reorder quantity and reorder level can help you to avoid stock shortage and purchase it as per your demand, in addition to improving regional utilization. Optimize Data and Forecast Demand Data is the equivalent of gold in the digital market. In today’s world, every business is collecting leads. Data will help your company to forecast its demand and improve regional utilization to offer better order fulfillment. You will not be overloaded with inventory or face shortages during seasonal sales. (You can learn more about this here, seasonal demand) Look at data on where your orders are coming from, what products are selling the most, and when orders are being placed. This will help you understand your demand patterns and identify opportunities to optimize your inventory distribution. Use a Warehouse Management System A Warehouse Management System (WMS) is a high-tech software mainly used for warehouse management. It automates multiple warehouse processes which makes fulfilling orders faster and less prone to errors and mistakes. Inventory across multiple fulfillment centers and sales channels can be managed from a single dashboard. Suggested Read: 6 Steps for Effective Physical Distribution Conclusion: How to Optimise Inventory Distribution and Regional Utilization with WareIQ for Faster Order Fulfillment? Regional utilization (RU) is now the standard industry indicator for measuring the effectiveness of eCommerce companies, whereby shipping orders from the same area might greatly raise the market's profit margin. An increase in regional utilization (RU) can address the unbalanced dynamics of supply and demand, enabling quick fulfillment, significantly reducing shipping costs and enhancing the customer experience. By focusing on regional utilization, businesses can reduce shipping costs, improve delivery times, and increase customer satisfaction, which can all contribute to long-term success. We at WareIQ personalize your deliveries according to their demand, priority, locations, etc. We offer branded shipping and micro fulfillment centers across the country to enable regional utilization in most cities and towns. WareIQ is an eCommerce fulfillment platform that offers Prime-like logistics to online brands for same/next day delivery. You can split your inventory in-house or you can use a tech-enabled 3rd party fulfillment company like WareIQ to get access to fulfillment facilities that are strategically placed all over India. We combine a nationwide fulfillment & shipping network, a highly-skilled warehouse operations team and our vertically integrated tech platform & inventory planning product to drive: Over 30% accelerated sales with same/next day delivery options across 20+ marketplaces/D2C platforms80%+ regional utilization & 40% lower holding costs100% compliance with marketplace SLAs with 0% leakage claims in processing returns Regional Utilization: FAQs What is multi-warehousing?Multi warehousing is a means of having different warehouses in prime locations handled from a single platform. It is unlike conventional centralized warehouses where all the inventory is kept and then distributed from there. This strategy is often used by ecommerce businesses that have a large number of orders coming from different regions or that sell a wide variety of products. What is the role of WMS in Regional Utilization (RU)?One role of a WMS in regional utilization is to help businesses optimize their inventory distribution. A WMS can provide real-time visibility into inventory levels across multiple warehouses, allowing businesses to better understand where their inventory is located and how it is being used. This can help businesses make more informed decisions about where to store their inventory and how much to keep on hand.A WMS can also help businesses optimize their fulfillment processes by providing tools for managing orders, tracking shipments, and managing returns. For example, a WMS might provide features like order routing, which can help businesses route orders to the most appropriate warehouse based on factors like inventory levels, shipping costs, and delivery times. This can help businesses improve their regional utilization by ensuring that orders are being fulfilled as efficiently as possible. How can Regional Utilization help eCommerce companies?Order fulfillment from a local warehouse, results in improved regional utilization to smart inventory allocation across different warehouses which,i) Saves 25% in additional logistical expenses per pieceii) Leads to faster deliveries, increased conversions and visibility in marketplaces.iii) Decreases return rates as a result of quicker delivery Does WareIQ help in demand-based inventory distribution?Yes, WareIQ provides a fulfillment platform with a multi-layered solution providing inventory & network planning excellence. With WareIQ’s vertically integrated tech platform & inventory planning product, online and D2C brands & marketplaces like TCNS, Blissclub, Flipkart fashion etc, have experienced more than 80% regional utilization with 40% lower inventory carrying costs.
June 29, 2022
What is a Retail Warehouse? Definition, Importance, Advantages & Challenges of Retail Warehouse in 2024
The world of retail warehousing is changing, constantly morphing to keep up with structural changes in the global eco-social system. Supply chain management is in flux. The constant changes here have amplified the crisis in supply chains. Demand is fluctuating YOY, and labour shortages have added to the turmoil. With all these in the larger economic equation, firms struggle to meet even basic demand-supply. When you factor in the eCommerce boom with the above, you realise that retail logistics are at a defining moment in their history. The Guardian reports that in the first half of 2021, a record six billion pounds were invested in U.K. warehouses. What’s more, the global warehouse automation market is expected to be just under 31 billion USD by 2025. There comes the need for retail warehouse putaway. As eCommerce warehouses, the retail backbone, change, only one option seems feasible. We need to respect the change, welcome it, and adapt to it. We need to see the challenge as an opportunity. What is a Retail Warehouse? The retail warehouse definition includes the following elements: It involves storing a retailer's goodsRetail warehousing involves online order fulfillmentFor the above two points, warehouse space is used Retail warehousing for eCommerce is a part of the retail supply chain. It is an essential part of it, directly affecting the efficiency and quality of every part of the supply chain activity that occurs after it. To illustrate the above, imagine a disorganised storage process within the warehouse. Here, fulfillment will naturally slow down at the very first step due to the difficulty of product picking. On the other hand, imagine an optimised, tidy warehouse. Pickers can now quickly pick and pack without botheration. Warehousing can be done in one of the following ways, depending on the size of the business: Done from homeDone from the storeRented warehousing3PL warehousing Currently, warehouse renting or 3PL partnering are considered cost-effective and plausible based on average retailer size. [contactus_gynoveda] Why is a Retail Warehouse Required? Retail warehousing is required because it performs an essential function within the supply chain. It is responsible for crucial supply chain functions, including the following: Inventory StorageCustomer Order FulfillmentRetail Store Order Fulfillment Inventory Storage This is a mission-critical process within the supply chain. It begins with procurement, wherein goods are ordered from the producer. After receiving the inventory, the warehouse organises and stores it. The process involves unloading every item of inventory. This is then sorted by SKU and type. Inventory counts are done to determine a match between orders and delivery. Inventory levels are reestablished. Once this is done, the inventory is stored methodically within the types of warehouse. Inventory organisation is essential. Popular SKUs are kept within easy reach. All SKUs have their location, and different SKUs are stored separately. For example, finished goods inventory is stored separately from production inventory. Customer Order Fulfillment A retail warehouse also functions as a fulfillment center, in which capacity they are also engaged in storage, picking, packing, and shipping preparation. Maintaining order accuracy while keeping the operations swift is the challenge. The warehouse management system, eCommerce platform, and inventory management systems need to work in sync to achieve this. Retail Warehouse Order Fulfillment Order fulfillment is done in various ways by the warehouse: Retail warehouses often ship to retail stores rather than to the customer.DTC brands ship directly to the customer.Retailers can ship to both customers and stores. The Evolution Of The Retail Warehouse There have been four generations of retail warehouses so far. Generation 1: Conversion of industrial units for retail useGeneration 2: Freestanding units built for a purposeGeneration 3: Retail parks consisting of many units in oneGeneration 4: Fashion parks that were more complicated than standard retail parks. As retail warehouses have evolved, the following changes have occurred within their setup: Well-trained employees: Due to the growing sophistication of the warehousing system, it is essential to keep employees well-trained. They need to know how to handle complicated software, like inventory management. They need to know when inventory needs to be restocked so as to always be ready for customer orders. Improved tracking systems: In the present generation of the retail warehouse, product scanning enables instant access to product information. Suppliers and customers can know important product information within seconds. Great storage systems: Modern tracking systems have made storage more efficient by optimizing available inventory spaces. This way, all the inventory space is utilized in the best possible way. The Developing Models Of Warehouses And Fulfillment Centers Warehouse management models are changing, and new bleeding-edge models are being born faster than ever before. Legacy systems are shifting. Let's talk about the strategies of warehouse and fulfillment centers in pointers here. These strategies have completely changed how warehouses function. Some of them are: Digital Warehouse Twinning Post-pandemic, the world now realises the importance of preparing for an emergency. Using technology, you can create a “twin” digital warehouse to simulate your physical warehouse performance. Twinning your warehouse (digitally) can provide a 20%-25% boost in your efficiency. New strategies for your warehouse can be tested on its digital twin. This can help make efficient business decisions regarding workflow and floor plan redesigns via simulation. Suggested Read: Factors affecting Warehouse KPIs On-Demand Warehousing Businesses face sudden spikes and declines in demand. This is why on-demand warehousing is gaining popularity. This model helps businesses meet short-term and immediate needs. Companies can now meet rapid fluctuations in demand without rigid and long-term contracts. The Service Angle Of Warehousing And Distribution (WaaS, DaaS) WaaS and DaaS are the new stars of the retail sector. Labour shortages and supply chain disruptions are tackled by shifting their management to competent partners. SMEs can now grow quickly with minimum risk. Firms can now focus on their competencies, free from logistical nightmares. The Magic Of Micro-warehousing As eCommerce has risen, so have consumer expectations. The need for quick home delivery has led businesses to decentralise into physically separate, digitally connected units. This has allowed for same-day delivery. Underutilised physical stores are now used as “dark stores” that exclusively service online buys. Advantages of a Retail Warehouse For eCommerce Fulfillment Retail distribution warehouses are great for eCommerce fulfillment. The reasons are many: They use existing facilities optimally.Urban areas that are struggling (like the loss of a mall) can be helped out.They can serve niche markets competitively.They offer high standards complying with industrial use as well as ample parking.Furthermore, they add to regional and local floor fulfillment centers. 4 Main Challenges of Retail Warehousing Faced by Online Brands in 2024 If you want to scale your business online, retail warehouses are essential. As your business grows, warehouse management gets more complicated. As you scale, here are a few challenges you may face for the year 2024: Lack of Expertise Normal demand periods come with challenges of their own. When you are trying to scale, however, warehousing can overwhelm you. Small retailers often don’t know the nuances of warehousing as experts do. The lack of experience may mean retailers overpay for low-quality solutions. Easily preventable errors may cost you money, time, and resources. Similarly, badly-planned logistics can jeopardise company operations. 3PL experience and knowledge can be a lifesaver in these circumstances. 3PLs can streamline warehouse processes and increase efficiency. Shipping protocols, last-mile logistics, and seasonal blockages can easily be countered by partnering with a great 3PL fulfillment provider. Inefficient/Outdated Technology One of the challenges of retail warehousing that can be nipped at the outset is poor technology. Outdated technology can lower warehouse efficiency instead of increasing it. Poor technology may be better than manual operations, but it can’t scale to a high order quantity. To optimise warehouse operations, you need modern, relevant, and easy-to-learn Warehouse Management System Software. Invest in the best hardware (warehouse automation, robotics, labels, and barcode scanners). Also, invest in a modern IMS and WMS. Long-term, these will surely give you a high ROI. Inventory Management Inventory needs to be managed religiously for one reason - so that businesses can always cater to demand. When order volumes are high, inventory is replaced at a rapid pace. This means inventory needs to be replenished and scaled to ensure there is no shortage. These are the steps involved in successful inventory management: Regular inventory audits to keep accounting practices and inventory levels at pace.Regular inventory replenishments to avoid stockouts and backorders.Demand forecasting, using trends and seasonality to hold enough ready stock and avoid deadstock.Keeping safety stock ready for emergencies.Keeping inventory counts current for all SKUs. Increased Order Volume Sometimes order volumes spike. To keep in tandem with high demand, an order fulfillment strategy that can manage higher than expected order volume is needed. To meet customer needs, you need proper warehouse workflow systems, staff, and storage space. If you don’t have these optimised, it may result in low order volume, low returns or worse. Study your supply chain before major growth periods. Ensure your processes, floor space, and storage space are adequate to meet all needs. Sometimes sudden, rapid growth calls for partnering with a 3PL. WareIQ Warehousing Solutions for Growing Brands Growing brands would do well to partner with WareIQ warehousing solutions. This full-stack e-com fulfillment platform helps brands increase sales. The cross-national network of last-mile couriers and fulfillment centers helps your business store goods closer to your customers. You are billed based on usage. The prediction engine based on machine learning optimises inventory placement and the design of the warehouse network. We offer the following services for growing brands: Logistics Consulting Logistics consulting will help you optimise both efficiency and cost of your operations. This service works for larger and well-established businesses by delivering a high ROI. Keep everything in-house with our logistics consulting services. Warehouse Management Software If you want to save time and money via automation, use warehouse management software. WMS gives you a high return on the effort by automating different warehouse processes. You can analyse the productivity of your warehouse by tracking data. Order fulfillment mistakes can be minimised using WMS. This software helps retailers manage day-to-day operations and run their retail warehouses efficiently. Third-Party Logistics Partnering with a 3PL is great, not just for DTC brands. It works well even for small businesses and large retailers, who can gain from the advanced technology and experience of 3PLs. 3PL outsourcing allows retailers to scale efficiently. They gain resources to grow their business with direct capital and real estate investments. Some retailers find it beneficial to store inventory in a centralised location. Others may find it better to distribute their goods across multiple warehouses throughout one nation. This lets retailers reach customers across pan-country locations efficiently. One route to do this is to buy or rent warehouses that require large investments. But the more efficient and cost-effective solution is to partner with a 3PL. 3PLs can minimise retailer costs by analysis, optimisation, and improvements in operations. 3PL also optimises time. For retailers who want to cut out planning, coordination, and execution of operations, partnering with a 3PL is a great way to go. Fulfillment Solutions WareIQ enables businesses to use cutting-edge technology to optimise their logistics. These include services from warehousing to eCommerce shipping, including storage and fulfillment. Prominent growing businesses, as well as smaller retailers, can benefit from partnering with WareIQ. You can reach more customers with WareIQ using multichannel retailing, B2B, and retail drop-shipping. A network of fulfillment centers and warehouses help you achieve fast shipping affordably. Expect uniform operations and order fulfillment regardless of where you store your products. Best eCommerce warehousing practices are observed in every warehouse. Use automation to the fullest to optimise, analyse, and make sense of your business. WareIQ’s top-class fulfillment solutions ensure that you are at the top of your game. [signup] Retail Warehouse FAQs What is a retail distribution warehouse?A retail distribution warehouse for a set of products is a warehouse or other specialized building that is filled with items (goods) to be redistributed to retailers, wholesalers, or directly to customers. Does WareIQ help with retail warehousing?Yes, WareIQ provides full-stack fulfillment services including retail warehousing where online businesses & eCommerce retailers can store their inventories before dispatching them to the end customers. WareIQ has a nationwide network of retail warehouses, and fulfillment centers to help the retailers store inventory closer to their customers How are retail warehouses different from ordinary warehouses?An ordinary warehouse is an allocated building that stores physical items until they are relocated, sold, or dispersed to other small enterprises. A retail store is essentially a location where things are sold to customers directly. What is the difference between retail and manufacturing?Retail is the process of selling products to customers. But, when something is manufactured through an industrial process in a factory, it is referred to as manufacturing. Is warehouse a retail business?Warehousing is not exactly a retail business. However, the concept of warehouse retailing does exist where goods are sold in bulk to give huge discounts as compared to traditional retail stores.A warehouse store, often known as a warehouse supermarket, is a food and grocery retailer that sells products at lower costs than a typical supermarket. These businesses provide a no-frills experience as well as warehouse shelving that is well-stocked with merchandise that is intended to move in large quantities. How WareIQ can help when you have your own retail warehouse?WareIQ has its own warehouse management system for brands who have their own warehouse, It can help brands manage inventory in real-time, reduce picking and packing logistics hustle, and helps to scale their business in multiple ways.
June 02, 2022
What is a Warehouse Management System (WMS)? A Detailed Guide for eCommerce Sellers: Features, Types, and Benefits of WMS in 2024
The world is now moving towards digital platforms at a supersonic speed. You can find almost everything on the Internet today. This is remarkably changing customer behaviour. Right from ordering foods to getting their favourite camera, individuals prefer online platforms like never before. Moreover, the payment process, shipment tracking, and even returning the product, everything is possible from anywhere, anytime. The overall paradigm shift in the supply chain has put the wholesalers, third-party logistics - 3PL companies, and logistics companies under tremendous challenge. As per the Statista report, in 2022, the number of online buyers crossed the 2.14 billion mark globally. In terms of value, in 2022, the retail eCommerce sales were 5.1 trillion U.S. dollars worldwide, and it is forecasted to touch 7.4 trillion dollars by 2025. There is no doubt that the situation will become more challenging in the future. Therefore, there is a need for an efficient, user-friendly, and fast Warehouse Management System (WMS). Managing a giant warehouse 24 x 7 is not an easy task. Additionally, it is like a nightmare without an efficient tool when you need to order many Stock Keeping Units (SKUs). WMS is a great tool to manage the entire activities of a warehouse. The WMS handles everything effortlessly from inventory management, stock replenishment, receiving, warehouse put-away, pick, packing, eCommerce shipping, and tracking of the logistics system. It helps you improve productivity and profit through advanced software and technologies. Barcode systems, RFID labeling, hi-tech automated robots for pallet movement, ERP systems, transport management systems, logistics software, augmented and virtual reality wearables, etc. are some of the hi-tech features of WMS. This article will walk you through the basic understanding of the warehouse management system, what is wms system, its features, how and where it fits with the supply chain, and different WMS systems. We will also discuss the benefits of Warehouse Management Software and the future of WMS. What is a Warehouse Management System (WMS)? A warehouse management system is a software solution that provides transparency and visibility to the entire warehouse operations. WMS is efficient enough to manage inventories, order fulfillment, and inbound-outbound logistics deliveries of any single warehouse or multi-location warehouse cluster. It is highly efficient in manufacturing setup and retail industries as it can track every movement of materials. An effective WMS can optimise your warehouse resources and allow you to maximize space utilisation. Moreover, with a suitable investment in the equipment, warehouse management software benefits the organisation by remarkably saving the material movement time. This, in turn, increases the efficiency of the warehouse. WMS reduces human efforts tremendously by tracking the entire material movement on a real-time basis. These software solutions are so efficient that they can trace the exact time of order placement, the pick-pack time, the person involved, and where the product has been transported by which vehicle. [contactus_gynoveda] What are the Features of a Warehouse Management System (WMS)? An efficient WMS offers many features to its clients, and the final goal is to simplify the business process while improving overall efficiency. While planning for a software solution for your warehouse, you must consider what feature tools are required. In general, there is a spectrum of warehouse management system features. Here are some essential features of a sound WM system. · Warehouse designing: The efficacy of a warehouse operation is maximum when it is appropriately designed, depending on the material flow, loading-unloading dock locations, number of materials to be handled, and many more parameters. WMS provides excellent design solutions to optimise the operations. It takes care of every minute detail of inventory management like storage location, pallet allocation, minimum travel path calculation, and many more. · Tracking of inventory: Modern systems can track every movement and reflect the fulfillment status on a real-time basis. Advanced technologies like AR wearable gadgets, RFID systems, and barcoding ensure that every material has its area and vice versa. Moreover, we can get a clear picture of the invoicing data, packing size, space availability, etc. · Receiving and storing: This includes receiving materials from suppliers, checking with the purchase order, and leaving materials at the correct location without any error. Additionally, the inventory is updated on a real-time basis. · Pick, pack, ship: The intelligent warehouse system analyses several parameters and provides solutions for the best way of picking the material from the shelf, packing procedure, and shipping information. This smart software can generate packing lists, invoices, and bills of lading with a single click and can send advance shipping notifications to the clients. · Workforce management: Hi-tech WMS helps the warehouse manager to run the show efficiently. It provides visibility on the resources and indicates human resources availability. Additionally, you can monitor their performances and set KPIs (Key Performance Indicators) for performance evaluation. · Reporting: Reporting is a critical part of a warehouse. It comprises abundant information from receipt, invoices, inbound and outbound deliveries, inventory status, and more. An innovative WMS can generate customized reports in real-time. · Yard and dock management: It assists the dock supervisor in getting a fair idea about available docks and reduces waiting time for the trucks. Moreover, it helps in managing cross-docking and other inbound-outbound deliveries. Where Does a Warehouse Management System Fit into the Supply Chain? A warehouse is the central part of any supply chain. It plays a significant role in running a smooth supply chain by receiving goods, storing them without any damage, timely issuing raw materials and components to the production shop floor, and delivering the correct finished products to the right person at the right time and quantity. For example, suppose the warehouse cannot provide the suitable material or component to the production line on time. In that case, it will hamper the overall production and SCM process, cause a delay in deliveries, and ultimately hinder customer satisfaction. This is a simple example of how warehouse management can impact the supply chain. The modern supply chain operates on visibility and transparency. The warehouse is responsible for providing the correct information on the inventory front, order fulfillment, invoicing, etc. The more efficiently the warehouse works, the more the organisation can fulfill the customer’s requirements. WMS suppliers are hence charting profitable territories. The warehouse profoundly impacts supply chain management's revenue and business strategies. It plays a significant role in improving SCM performance by Efficient storageStrategic locationSecurityInventory AccountabilityFulfillment of orders and warehouse distribution servicesEconomic benefitsValue-adding operations What are the Types of Warehouse Management Systems in 2024? Basically, we can categorise it into three major types: Standalone WMS This is the most traditional form that most organizations use. It is deployed on the company’s premises and uses its hardware system. According to their business complexities, every organisation can do a high level of customisation on this standalone WMS. Though it is a costly option, you can have tighter control over the system. After the system development and implementation, it is the asset of the company, and they need to bear the cost of maintenance, expansion, and updates. Another drawback of this traditional system is the complexity of integration with other latest next-gen technologies. Cloud-based WMS With the introduction of cloud technology, the latest WMS has adopted this platform to provide seamless solutions. You can enjoy the benefit of horizontal implementation at a faster pace. This, in turn, reduces the implementation cost. This system has the next level of advantages. There is no need to use your own hardware and IT resources for implementation and maintenance. The auto-update facility keeps you away from the headache of regular hassle. This system can be scaled up with your business expansion without investing much. Moreover, as it operates through the Cloud, your data is safe from any internal disaster. SCM and ERP-based WMS There are many software solutions that provide an entire system to the organisations for every function. For example, Enterprise Resource Planning software like SAP and Oracle offers a package solution that includes all the functions as modules. They have a finance module, production planning, material management module, inventory management module, and warehouse management module. The beauty of these solutions is, that they are integrated, and all data is linked to each module. Therefore, such systems are capable of providing a holistic picture to the management and offer end-to-end transparency of the supply chain. What are the Benefits of Warehouse Management Systems? There are several benefits of having a robust WMS in place. This helps the organisations improve their efficiency in every facet in the long run. We have listed some of its crucial advantages: Improved operational efficiency: The WMS is connected to many new advanced technologies, which helps streamline processes and reduce errors significantly. Warehouse management software checks every step to avoid mistakes from the inbound receipt to the outbound deliveries. Moreover, with the help of automated tools, the warehouse team can handle larger volumes with less effort and less paperwork. By eliminating the non-value-adding activities (NVAs) and duplication of work, WMS enhances the overall efficiency of warehouse operations. Better inventory management: Inventory blocks a tremendous amount of money in terms of materials but is essential to manage unplanned situations. An efficient warehouse management system in logistics indicates the correct inventory level and defines the min-max levels of items. Based on their usage and the number of picks from the warehouse, WMS indicates the frequent, medium, and rarely used items, which helps in correct material ordering. Moreover, the advanced warehouse management software can identify excess and obsolete inventories and trigger you to take necessary actions. Holistically, to manage a healthy inventory, you need a robust WMS. Improve labour management: You need not worry about labour management if you have intelligent WM software in place. To enhance the productivity of the resources, it can define workloads for the staff and optimise the in-warehouse movement path. It can even indicate the labour requirement and create a schedule for them. Safety is today’s topmost priority, and advanced WMS reveals the possible hazards within the space, ensuring the safety of man and machine. Reduce cost: Modern store management software is smart enough to calculate and advise optimum space utilisation ideas for e-commerce warehousing. It also determines the minimum travel path of the materials to reach the assembly line or loading point. Suppose you adopt the high-tech WMS during the initial warehouse design stage; its advanced simulation will help you to create optimised floor plans. Moreover, it highlights the perfect pallet locations, shelves, and equipment areas to run the warehouse with the highest efficiency, which, in turn, saves you a lot of money. Waste reduction: Modern software is backed up by solid data. WMS automatically identifies and applies the First-in-First-out (FIFO), Last-in-First-out (LIFO), or Highest-in-First-out (HIFO) policy on the goods based on the strategy. In the case of perishable or shelf-life items, this smart system informs you well in advance about the items approaching their end. It triggers you to pick those items first or prompts you for a sales push to avoid wastage. Boost customer satisfaction: Today’s businesses are driven by customers, and boosting their experience and engagement is crucial for success. Top-notch warehouse management software can help to boost your customer delight by improving order fulfillment, quicker deliveries, and fewer inaccuracies. If your WMS is integrated with any CRM software that provides a status update to the customer, it will improve your customer loyalty and brand reputation. Enhance supplier relationship: Suppliers are the pillars of any business. You need a close, transparent, and real-time information-sharing system with your suppliers to have a robust supply chain process. Your WMS can be integrated into the supplier’s system, bridging the gap and establishing a two-way information flow. It makes the process more flexible, and your suppliers enjoy a healthy business relationship. The WMS also benefits as the technology takes the entire industry towards the cloud infrastructure. Advanced cloud-based warehouse management software solutions provide some fantastic benefits as listed below. Fast implementation: Considering the traditional systems, cloud-based WMS is faster to implement. Where the conventional system takes months to implement, the advanced cloud-based platforms can be implemented within weeks, depending on the complexities. Quicker implementation provides minimum interruption to the running business and improves ROI and profit for fast-paced organisations. Fewer upgrade hassles: The beauty of cloud management includes the updates and modifications that occur on the cloud system itself. The vendor takes responsibility for making necessary modifications and changes in the cloud server. There is no need to update the system at regular intervals. It saves time and hassle for the customers. Moreover, it avoids costly customisations like the in-house software. It ensures that you always work on the latest version. Lower upfront cost: Cloud-based WMS is significant in terms of initial and running cost savings. This architecture neither requires any hardware or software installation nor any IT administrator to manage it. Additionally, the auto-updates, installation of the latest version, and modifications help you save tremendous time and money. There is no need to allocate additional resources to manage. Scalability and flexibility: As your business grows, you need to expand the IT systems and WMS. Cloud-based structures are remarkable in terms of scalability. The WMS can be scaled up quickly and can handle more complex supply chain situations. Furthermore, the flexibility of such a system provides a huge advantage to organisations in managing difficult situations. Seamless integration: You may be using different software solutions like ERP systems, software for your accounting process, and likewise for your business. The advanced WMS cloud versions are easy to integrate with your other business software, and you can get an integrated IT solution for your needs. How do I choose the right WMS for my business? There are several factors to consider when choosing the right warehouse management software for your business: Determine your business needs: Identify the specific problems you are trying to solve and the features you need in a WMS system.Research potential solutions: Look for options that meet your business needs and compare their features and pricing.Evaluate the vendor: Consider the vendor's reputation, customer support, and ability to customize the software to your specific needs.Test the software: Ask for a demo or trial version of the software to see if it meets your expectations and is easy to use.Consider integration: If you have other systems, such as an enterprise resource planning (ERP) system or transportation management system (TMS), make sure the warehouse management system can integrate with them.Get customer feedback: Ask for references from other businesses that are using the software and get feedback on their experience.Evaluate the total cost of ownership: Consider not just the upfront cost of the software, but also the ongoing costs of implementation, training, maintenance, and support. What is the Future of Warehouse Management Systems in 2024? With the increasing demand in eCommerce and other industries, there is no doubt that businesses need to deliver the products in the shortest time period. The best possible way to handle such a situation is to manage your warehouse efficiently. WMS is going to solve the major issues of organisations by providing advanced solutions, and the future of this technology looks bright. According to a study, in 2022, the worldwide valuation of the WMS market was USD 4.7 billion, and it is forecasted to touch the mark of USD 8.9 billion by 2030. This shows a significant CAGR growth of 11.1% from 2022 to 2030. But how will the warehousing system reshape itself in these next couple of years? Let us see in detail. Introduction of Robots To manage the mammoth material's inbound and outbound flow, it is evident that warehouse management systems in logistics need automation. The introduction of robots in managing warehouse operations is a must. This revolution has already started, and many companies are offering best-in-class robotic solutions in this area. These robots can move materials to designated places, load and unload materials from vehicles, accurately pick-pack and ship, etc. Cobots, which are collaborative robots, work with humans to enhance productivity. Articulated robot arms and automated guided vehicles reduce human errors significantly and provide a safer environment for the warehouse staff. Drones for WMS Organisations are now keener to implement drones in their warehouse management. Drones are primarily used in different events, corporate activities, and defense purposes. However, their high efficiency, speed, and uninterrupted flow can significantly improve the movement of the materials in the warehouses. Many organisations are experimenting with deliveries with drones. It will not be a surprise to see drones lifting materials from storage racks and issuing them to the shop floor or unloading raw materials from vehicles. Using Smart Gadgets in WMS Renaissance in technology from industry 1.0 to industry 4.0 showed us drastic changes in every facet. We saw the shift of store management from pen and paper to computerised systems and laptops. It is the era of intelligent and handy devices. In the Internet-everywhere environment, WMS can be accessed from anywhere, and you only need a smart device and Internet connectivity. The advanced WMS can operate on any device and operating system. You can scan barcodes and RFID, access the warehouse management system, track inventory, invoice shipping notifications, etc. This makes the system handy, increases productivity, and optimises the man force. Augmented Reality Wearables The popularity of using AR gadgets in warehouse management increases daily. These are innovative gadgets packed with ultra-modern features like scanning, WMS access, auto-counting, etc. These devices can help you identify the exact item code of the component and backtrack the order number, WBS element, and even the customer order number. They remove the dependency on human memory, and thus, will reach the maximum accuracy level in the future. Smart Automated Vehicles and Forklifts Auto-guided vehicles are the best gift of technology to the warehouse management system in logistics. Due to its high buying and maintenance costs, you cannot find these in most organisations. However, the future smart warehouses will be managed by these machines. Software programming enables these machines to operate automatically without any assistance. This will help organisations to reduce operational costs and increase efficiency drastically. On-Demand Warehousing Solution This is another prospect that will be a popular option in the future. It will offer flexibility to the organisations to manage pick situations demands. The additional capacity of the rented warehouse on an as-on-when-required basis will help small businesses spend less on costs. Big Data and Machine Learning Big data and ML are not new terms but the latest introduction to the warehouse management system. For large organisations, it is vital to analyse all the data points related to warehousing and populate them with decision-making templates. Warehouses store a massive amount of data; therefore, in the future, using Machine Learning and Big data analytics will be essential. You can also read about the top warehousing companies here. Conclusion: Does your eCommerce business need a Warehouse Management System (WMS)? Currently, the business processes are getting highly complex. There are several factors like same-day or next-day delivery, changes in customer demand and expectations, challenges in the lead time, higher competition in the market, etc. To mitigate the ever-changing requirements and stay ahead of your competitors, you need to operate your warehouse efficiently. A warehouse management system can do it for you. If you are planning to set up your warehouse system or thinking of expanding your eCommerce business, it is the correct time to introduce an intelligent and next-gen WMS. It is an investment to increase productivity and take your warehouse operations to the next level. Knowing about WMS and its necessity in today's business environment. You must have thoughts, to access such warehouses to boost your business. You have an option of outsourcing such warehouse plus fulfillment centers run by experts without owning and spending millions on the system. WareIQ provides fulfillment services to amplify your business which not only gives you the benefits of the Warehouse Management System in logistics, but a lot more. Established in 2019, WareIQ, a Y-combinator backed startup, has rapidly grown to be the leading provider of full-stack eCommerce fulfillment services for some of the most reputed brands in India. WareIQ offers a full-stack platform for eCommerce companies to enable same-day delivery and next-day delivery to customers – an Amazon Prime-like experience but accessible to everyone. WareIQ has empowered brands to sell more, sell faster & sell everywhere due to: Access to WareIQ’s strong nationwide network of fulfillment centers, micro-fulfillment centers & urban dark stores near their customersAccess to all major national & hyperlocal last-mile couriers at discounted rates for making same/next day deliveries possibleEasy integration across multiple online platforms & marketplaces enhancing multi-channel sellingHorizontal marketplaces: Flipkart, Amazon, etc.Vertical marketplaces: Nykaa, Myntra, etc.D2C platforms: Shopify, Magento, WooCommerce, etc.Social commerce platforms: BikayiAccess to a superior centralised tech platform for eCommerce operationsML-based prediction engine for efficient warehouse network design & smart inventory placementCentralised platform for core fulfillment & shipping operationsPost-shipping apps for delightful experience & zero to minimum supply chain leakages (Branded tracking page with smart marketing placements; Trigger-based updates & smart communication platform) WareIQ has customised offerings for merchants experiencing different order volumes as well as having different delivery speed expectations. WareIQ is probably one of the very few fulfillment tech companies in the world that have same-day delivery service for their customers under their product “WareIQ RUSH”. With world-class WMS functionalities, WareIQ handles the entire range of intricate operations in the eCommerce fulfillment process, ranging from Inbound Operations such as scanning and quality check, through 100% accurate Pick and Pack, to Inventory Management across all channels. WareIQ’s next-day delivery and same-day delivery services are helping eCommerce businesses set new standards with respect to setting customer expectations and fulfilling them with high efficacy. At the same time, WareIQ customers realise significant cost savings and wider reach due to better negotiations with shipping partners, strategically placed warehouses, economies of scale and scope in warehousing, and data-driven decision-making. WareIQ’s WMS, a centralised tech platform helps to better manage undelivered orders by reducing NDR report processing time by 12 hours – a multifunctional NDR dashboard helps to track and take immediate action for undelivered orders in real-time, thereby reducing RTO by up to 10%. Automatic replenishment recommendations and easy purchase order creation capabilities on the WareIQ platform further empower eCommerce companies to leverage all possible ways of increasing their ROI. [signup] Suggested Read: Warehouse Management Vs Inventory Management: Which Software is Better? Warehouse Management System (WMS) FAQs What software is used in a warehouse?Warehouse management system is the software used in warehouses. This software is made to help users improve the efficiency of tracking inventory and supplies as they move through a warehouse. What is a Warehouse Management System (WMS)?A warehouse management system (WMS) is a software solution that provides inventory visibility and handles supply chain fulfillment operations from the distribution warehouse to the retail store. Is WMS an ERP system?The main distinction between WMS (Warehouse Management System) and ERP (Enterprise Resource Planning) is that a WMS is a stand-alone system that requires other software to function, whereas ERP is an all-in-one solution. What is SAP's role in warehousing?The SAP Warehouse Management System (WMS) helps you process all goods movements and manage stocks in your warehouse complex with ease. Compare SAP and WMS.SAP Inventory Management assists in the management of stock quantities and values across multiple storage sites. The WMS, on the other hand, allows you to map your entire warehouse complex down to the storage bin level and determine where a specific material is now located. What are the different warehouse service offerings?There are 7 warehouse offerings namely:• Pick and Pack services• Sub-assembly services• Site location services• Distribution Center Management services• Vendor Managed inventory• Cross docking services• Fulfillment services Who are the top vendors in the WMS market?The big 4 are;• IBM• Microsoft• Oracle• SAP How much does a warehouse management system cost?The cost of a warehouse management system (WMS) can vary widely depending on the size and complexity of the system, the number of users, and the level of customization and integration required. Some basic WMS systems can cost a few thousand rupees, while more advanced systems can cost hundreds of thousands of dollars or more. Can a warehouse management system (WMS) integrate with my existing systems?Many warehouse management systems can integrate with other systems, such as an enterprise resource planning (ERP) system or transportation management system (TMS). The integration allows different systems to exchange data and communicate with each other, enabling a more streamlined and efficient workflow. When evaluating a WMS, it's important to consider whether it can integrate with your existing systems or any systems you plan to implement in the future. Some WMS vendors offer pre-built integrations with popular systems, while others may be able to custom-build an integration for you. It's also worth considering whether the WMS has an open API (application programming interface) that allows you to easily connect it to other systems. This can make it easier to integrate the WMS with other systems in the future, even if the vendor doesn't offer a pre-built integration. You can contact us here for support. Does WareIQ have a WMS?Yes, WareIQ provides a full stack fulfillment platform with unified OMS (Order Management System) and WMS(warehouse management system) that enables real time inventory & order sync across both softwares for better analytics.
April 30, 2022
What is Warehouse Management? Definition, Benefits, Strategies and Latest Trends in 2024
Proper warehouse management is essential for the success of any business. If you sell goods, you must have a place to store them. These places are often fulfillment centers, distribution centers, or warehouses. You can purchase land and buy equipment, but many things need to be considered when managing inventory. You can have the most modern and state-of-the-art warehouse but if it's not operating efficiently, you will have lower profit margins, high operational logistics costs, ineffective leadership, and damaged customer relationships. What is Warehouse Management? Source Warehouse management spans all aspects of operation, from accounting to inventory. It includes receiving and supervising employees, as well as planning supplies and monitoring the flow of products through the warehouse. It is a very important aspect of eCommerce because much of the process of order fulfillment begins at a warehouse so efficient warehouse management is needed so that orders are picked, packed, and shipped efficiently and in the least amount of time possible. [contactus_uth] What are the Benefits of Warehouse Management? A warehouse is an invisible process that works to ensure that the customer gets their product on time. The operations are central to the success of any warehouse, and good management helps these processes run efficiently. Some benefits of warehouse management are: Optimized Space and Lower Operating Expenses Warehouse management seeks to make the most efficient use of available space by determining the area size and analysing the floor plans. This determines where and how products can be stored, such as placing in-demand products and products close to expiry at the front, the rate at which products can be located, either to be shipped or packaged and results in the saving of time, resources and money. Inventory Visibility Warehouse Management can also give insights into inventory levels for various products in multiple categories. This helps retailers to accurately forecast demand and avoid over-stocking or shortages. Effective Labor Warehouse management enables maximum utilization of labour by intelligently assigning them to a specific warehouse based on their proximity, their availability, and their skills to ensure the highest levels of productivity and the complete mitigation of underutilization. This, in turn, saves on time, and money spent on labour and removes any chance of manual delays. Traceable Materials Warehouse management enables the traceability of inventory because products are grouped in sensible ways such as by demand, perishability or expiry date. All products have serial numbers which makes them easily identifiable in any given situation. Optimized Supply Chain Warehouse management is designed to optimize existing processes within a warehouse, which can also extend to the external supply chain. WMS systems can troubleshoot any activity that is causing a delay and suggest methods to streamline those activities to mitigate such a delay in the future. It can also remove any unproductive activities from the process to ensure maximum productivity is being achieved. This helps in saving resources, time, effort, and money. What are the Various Strategies of Warehouse Management? By optimizing warehouse operations and managing inventory, warehouses provide the best services for clients. Warehouses that have poor strategy will have increased costs and wasted capacity. Quality warehouse management companies use a client-focused approach to their warehousing strategies. They provide logistics services to clients to support customer demand. The top expense of any operation is the labour required. Nevertheless, 3,000 hours each year are wasted due to inefficient planning of operations. If you're searching for strategies to increase your profits and lower costs, look at these nine ideas to improve your earnings. Use Sales Forecasts It's essential to use both past and future data when strategizing your warehousing. By thinking about how many orders will come in, you'll be able to plan accordingly. Planning for the future ensures that none of your employees is overworked. Having this strategy in place every quarter will help you foresee any potential problems and take appropriate measures to fix them. These strategies are especially useful in warehouses with heavy volumes, as they provide needed relief to your employees. Determine your expenses It is possible to increase your revenue by reducing expenses. For example, there's a lull in dock activity during the last week of every month. It is an opportunity to reduce costs in labor and equipment. Still, without first figuring out where you need to invest money in your warehousing strategy, you won't be able to plan appropriately. Automate your processes Warehouses can use automation to increase efficiency by providing support for operations and analytics. The warehouse's needs determine the type of automation used. Companies often make life more difficult by using inefficient or ineffective technology. Make sure the software you choose is tailored to your day-to-day operations. Too much technology can be a distraction to your employees. Find that balance between state-of-the-art features and simplicity so employees can quickly transition as they would with an old system. Choose the right location When seeking a warehouse, find one where the talent is plentiful. Choose a location for your warehouse that provides access to the best possible employees for your specific needs. A competitive employer will find a place in reasonable proximity to its workforce when feasible, rather than being directly in the area of other businesses that might take away your talent. They also try to find a location within reasonable commute distance for their staff. Get rid of old inventory Unless you're selling long-term storage space, inventory that doesn't sell costs you money. Space is the primary factor in any warehouse and must be treated as valuable. Clear out your unused merchandise. When you find that the items you carry don't sell or only sell marginally, you could be stuck with them longer than desired. Getting rid of these products and saving space is an opportunity to make some profit. Choose centralized Warehouses Warehousing is a popular strategy in warehouse management, against the traditional use of smaller, regional warehouses. Companies see the benefits of a larger facility that serves the same customer base due to increased savings. Warehousing is cheaper, which means that the logistics of processing orders will also be more affordable. Warehouses require transportation, staffing, security, climate control, and lighting, which often leads to increased costs when there are many facilities. A centralized warehouse can take care of this issue. Outsource To third parties Some companies outsource their warehouse management requirements to a lower-cost alternative that doesn't sacrifice quality to optimize profitability. Logistics providers understand warehousing well and can provide relevant information to help companies to improve quality while reducing costs. Read the blog on eCommerce Logistics Companies to know the benefits of partnering with them. Public warehouses are attractive to companies that outsource their emergency or temporary storage needs. You can also see many other services related to logistics, such as shipping aggregators, freight transport, rail and receiving, container delivery, and import-export logistics. These work well for clients who want full-service logistics for an as-needed basis at an affordable rate. Use Electronic Monitoring Systems Warehouses are no longer reliant on security patrols to maintain safety. While security staff still poses a vital function, warehouses employ technological solutions to reduce the risk of theft. Electronic monitoring systems work well for theft prevention, but they can also monitor against other threats like fire and water damage. Using this system is a great way to reduce your chances of being harmed by an internal or external source. This type of warehouse system may deter theft and reduce the number of people who need access to your items. For customers, it means product safety and low prices. With a reduced amount of labor, businesses can keep costs down. De-clutter Warehouse Operations When carrying out warehousing tasks, it is essential to carry out Lean Operations. By optimizing the resources at our disposal and taking into consideration a "just-in-time" approach, we reduce the time it takes to undertake these tasks: Handling inventoryBetter coordination for effective supply chain managementLooking for stockLoading and unloading onto transport Differences Between Inventory Management vs Warehouse Management [table id=14 /] What Facilities Should You Look for in a Warehouse Management Company? No. of SKUs ( stock keeping unit) Before you begin, you should assess your storage needs. Then, identify the SKU you want it under to track inventory in a warehouse. You can also think about the amount of space needed and what will be compatible or not. You might want to invest in durable shelving made of metal, as it will be a cheaper alternative. Warehouses will charge you based on the SKU, and this can get expensive if you have too many cereal items with different expiration dates. Warehouses often require a minimum monthly order from these companies. However, these minimum monthly orders are affordable if the inventory is readily available or rotated quickly. On the other hand, standalone warehouses are cheap for slow-turnover items with high SKUs. Product Type Warehouses usually don't have cold storage facilities. The product you sell will help determine which warehouse management company is best for your business. If a company requires space to store dairy products, it needs a warehouse that offers temperature-controlled storage. Customers will find glassware, manufactured goods, or perishable items like eggs or seafood in this store. Third-party fulfillment services provide workstations where value-added services are provided. Consider what storage option is perfect for your business. If you sell products that require strict safety protocols, you would be better suited to choose a warehousing management solution with trained staff, fire alarms, sprinklers, and adequate risk-reduction measures. Season Finding a warehouse management solution for your business needs is essential. Public warehouses are ideal because they offer short-term storage and competitive rates. It would be best to think about the time it takes them to deliver and their prices. Public warehouses are worth considering when looking to carry and store seasonal goods. If a company has a high demand, it might run out of space when they have periods of low sales. For example, if a store's turnover is generally slow in the winter season, it may find that stocking shelves during that time is difficult. Warehouse management providers solve this problem by providing automated material handling and storage automation solutions, such as forklifts for factories and warehouses. Contract warehouses offer reliable and long-term storage solutions, while short-term storage facilities are suitable for short-term needs. Under the contract warehouse, customers agree to the contract period before they're paid. Factors like the maintenance fees of inventory equipment affect their charges. Location Your warehouse location will affect the efficiency of your business. Location can impact how quickly you can deliver goods to consumers and where they are stored at your warehouse. The closer you are to customer hubs, the quicker the product can be provided. Warehouse management companies with facilities close to a transport hub make fulfilling orders much more effective than those in big cities. Your warehouse's location impacts your ability to meet the customer's expectations, improve profitability, and get products to customers faster.; however, this can come with a higher price if storage facilities are in rural areas. Read our blog on the 10 best eCommerce shipping companies in India to understand how you can outsource your shipping requirements. Here are some points to keep in mind: A small business should consider locating a warehouse close to their market or office.Companies with large market bases should look for warehouses that can hold specific quantities. Software & Technology Invest in a warehouse management facility and warehouse management software to handle inventory and shipments better. With these tools, you can enhance customer satisfaction by ensuring that the product matches their order, so they are satisfied with what they receive. Warehousing software is a vital tool for those who need to track and analyze each order. These programs are operated by intelligent robots, which automatically manage the order fulfillment process. The automatic routing of customer orders to your warehouse allows you to track order fulfillment more efficiently. You can also use automation to collect purchase orders and manage inventory items. Top 10 Trends of Warehouse Management in 2024 As we bid farewell to 2021, it's also time to gear up for the future with new ideas and strategies to make your business more productive. Warehouse management plays a crucial part in the supply chains of any eCommerce company. But sellers often overlook staying up-to-date with eCommerce warehousing trends to help them stay ahead of the game. As customers demand quicker turnaround times and pressure on eCommerce companies builds, warehouses will need to devise new ways of getting products picked, packaged, and shipped to meet the demands. The best way to increase warehouse efficiency is by implementing warehouse management technology. Warehouse management technologies will likely grow exponentially by 2024, with some reaching full maturities, such as warehouse automation and post-purchase processing. Automation (AI & Machine Learning) As the warehousing industry in India enters a period of consolidation, it will likely begin to integrate more advanced technologies such as robotics, machine learning, and artificial intelligence by 2024. Although, in labor-intensive countries like India, the implementation of robotics can be difficult due to specific tasks only being performed by humans. Warehouse management companies are trying to incorporate machine learning and AI into the back-end. Technologies such as autonomous vehicles will cause the cost of warehouse operations to decline, causing this industry to almost double in size over the next two years. What are some ways in which we can plan for the future? The advancement of automation technologies has led to better self-driving with autonomous vehicles and inventory systems that reduce human labor.Receive instant updates about warehouse and shipping operations with the help of AI-powered inspections, packaging, and processes through business intelligence.The adoption of warehousing solutions that predict demand will take off in the following year. Robots Robotics is becoming integrated into the labor market, and this trend is projected to continue. Robotics help companies increase productivity while also tackling warehouse management and supply chain challenges. Robots will become standard in warehouse management operations in the future. We will move away from fixed automation systems to miniature mobile robots. 5G connectivity and machine vision systems will also play increasingly important roles. Cloud-based Technologies Cloud technologies are advancing, and adoption is increasing. Current advances in hybrid cloud solutions, where components of a project reduce time and resources, will allow companies to implement better strategies. Cloud computing motivates many people to move to the cloud because it reduces costs and increases efficiency. It also helps eliminate data silos that predominate in many warehouse management systems and supply chains. Internet of Things (IoT) The Internet of Things has touched every industry and affected how we see the world. It stretches across interconnected devices, including cars, factory machines, appliances, TVs, and phones. Through IoT, your warehouse management processes can run simultaneously and increase efficiency. It can automatically complete tasks while you remotely access data and lowers costs since you have more efficient resource management. Sustainable Warehousing Many business owners will be looking for sustainable business methods in the coming year. It will change warehousing management techniques in 2024. Ways you can opt for Sustainable Warehousing: Invest in Energy-efficient Equipment You can make your warehouse environment more environmentally friendly with eco-friendly lighting. While the initial cost will be higher, they will last longer and save on energy costs in the long run. Use Less Packaging Packaging made from biodegradable materials weighs less and costs less to ship. Switch from traditional packing materials to biodegradable products. Packing materials made from synthetic plastics and biodegradable materials take a long time to break down. Biodegradable materials can only last for months or years, while synthetics take hundreds of years to break down. Making your packing more efficient may mean you need less of it. Biodegradable materials are also compostable and can reduce waste and carbon footprint. Insulate your Warehouse Properly Ensure that your warehouse is insulated to keep air-conditioned air within the building. Insufficient insulation in your warehouse building results in higher energy costs, increased thermal output, and wasted resources. Water in a warehouse management system leads to wear and tear and increased energy bills. Block-Chain Technology Many stakeholders such as manufacturers, suppliers, customers, auditors and warehouse managers, are involved in warehouse management efficiency. Warehouses are looking for technology to manage transactions, assets, and data. The use of blockchain in coming years will be revolutionary for warehouses. Big Data Data is a significant point in supplying products and warehouse management since it helps with these tasks. Businesses rely on data for more reasons, and companies use more data-driven technologies now than ever before. It also allows for data products that can be used in data visualization to understand trends better. Good access to data and predictive analytics enables cross-disciplinary applications, which are instrumental in warehouse management. Proficient Last-mile Deliveries With the growth in eCommerce, last-mile deliveries are becoming more critical for the industry. In 2019, global eCommerce sales grew by nearly 21.5%. In the next few years, many business owners will strive to provide a shopping experience reminiscent of Amazon by working out logistics in a way that would make deliveries close to same-day. When customers place orders, the company will need to invest in more facilities and distribution methods. What are the last-mile facilities in supply chain management? The Right Warehouse Location Warehouses close to major highways and bridges reduce the cost of delivering to destinations. Building Quality Retailers should always look for properties that have features that allow for efficient utilization, given the demand for high volumes associated with today's retail environment. The archaic nature of traditional warehouses has led to structural limitations, and stretching the electrical capabilities of these warehouses is becoming more and more difficult. Substantial Ceiling Heights For warehouses, it's essential to optimize a high ceiling to set up modern racking systems. Every warehouse should consider the way goods flow in and out. Cross-dock Capabilities The food and beverage industry faces one of the biggest challenges regarding last-mile transport. A company may optimize its facilities' capabilities by cross-docking groceries to solve this problem. Cross-docking is receiving goods at one door and then sending them out through another. Perishable items can be delivered to your shoppers more efficiently, and food does not need to be stored. Sustainable Warehousing Electric charging stations will be essential parts of future sustainable infrastructure for that last mile. The gas costs combined with labor for the final stretch of delivery can add up to over 30% of a delivery's price, so cutting those expenses and providing an environmentally friendly solution could give you a winning advantage. Design & Layout One of the driving factors of warehouse management is its design and layout. It can be challenging to make changes to an existing warehouse, but you'll be glad you made an effort once you see improved productivity and lower accident rates. When you lack space for your automated systems, one solution is to use your vertical space. Technology solutions such as mechanical shelving and big data are also available to help more intelligent warehouse layouts. You can use analytics to monitor where your employees spend the most time so that you can create more efficient workflows. Introduction of Drones With technology moving on, these drones are starting to find their niche in warehouses. They're affordable and easy to use and can quickly map large areas. Drone technology has also been used in shipping and delivery, where it's used for scanning barcodes and RFID tags, inspecting goods in the warehouse, and taking items to an airport. Retail companies will likely use drones for warehouse management by 2024. Amazon has already had success in their warehouses by using them, and now smaller companies will probably start to do the same. For example: Humans are being phased out of the workforce. As technology advances, positions are no longer available to humans, and they are being replaced with machines that can do tasks much faster.A drone equipped with a special camera with optical sensors can scan barcodes at 100% accuracy even when the items are 10 meters away. Suggested Read: Warehouse Management Vs Inventory Management Conclusion: Does Your Business Need Warehouse Management? Warehouses have been around for years and have helped businesses with different storage needs. Today, warehouses are not simply storage facilities because they have changed to be more innovative. Companies that rely on warehouse management can expect increased productivity, satisfaction, and accurate demand forecasting. Some warehouse management companies offer additional services that optimize the supply. Warehouse management must monitor your inventory with many companies providing this service, renting out space, and providing other essential information such as the amount of heat produced or stock being moved. WareIQ can help with all your warehouse management requirements. Established in 2019, WareIQ, a Y-combinator backed startup, has rapidly grown to be the leading provider of full-stack eCommerce fulfillment services for some of the most reputed brands in India. WareIQ offers a full-stack platform for eCommerce companies to enable same-day delivery and next day delivery to customers – an Amazon Prime-like experience but accessible to everyone. WareIQ has empowered brands to sell more, sell faster & sell everywhere due to: Access to WareIQ’s strong nationwide network of fulfilment centres, micro-fulfillment centers & urban dark stores near their customersAccess to all major national & hyperlocal last-mile couriers at discounted rates for making same/next day deliveries possibleEasy integration across multiple online platforms & marketplaces enhancing multi-channel sellingHorizontal marketplaces: Flipkart, Amazon etc.Vertical marketplaces: Nykaa, Myntra etc.D2C platforms: Shopify, Magento, WooCommerce etc.Social commerce platforms: BikayiAccess to a superior centralised tech platform for eCommerce operationsML-based prediction engine for efficient warehouse network design & smart warehouse inventory placementCentralised platform for core fulfilment & shipping operationsPost-shipping apps for delightful experience & zero to minimum supply chain leakages (Branded tracking page with smart marketing placements; Trigger-based updates & smart communication platform) WareIQ has customised offerings for merchants experiencing different order volumes as well as having different delivery speed expectations. WareIQ is probably one of the very few fulfillment tech companies in the world that have same-day delivery service for their customers under their product “WareIQ RUSH”. With world-class WMS functionalities, WareIQ handles the entire range of intricate operations in the eCommerce fulfilment process, ranging from Inbound Operations such as scanning and quality check, through 100% accurate Pick and Pack, to Inventory Management across all channels. WareIQ’s next day delivery and same-day delivery services are helping eCommerce businesses set new standards with respect to setting customer expectations and fulfilling them with high efficacy. At the same time, WareIQ customers realise significant cost savings and wider reach due to better negotiations with ecommerce shipping partners, strategically placed warehouses, economies of scale and scope in warehousing and data-driven decision making. WareIQ Fulfillment Centers WareIQ’s WMS, a centralised tech platform helps to better manage undelivered orders by reducing NDR processing time by 12 hours – a multifunctional NDR dashboard helps to track and take immediate action for undelivered orders in real-time, thereby reducing RTO by up to 10%. Automatic replenishment recommendations and easy purchase order creation capabilities on the WareIQ platform further empower eCommerce companies to leverage all possible ways of increasing their ROI. [signup] Warehouse Management FAQs (Frequently Asked Questions) What is the main purpose of a warehouse?The main purpose of a warehouse is to efficiently utilize the warehouse space, labor and equipment to store & manage inventory while meeting customers' expectations and demands. What are the functions of warehouse management?• Storage of goods• Price stabilization• Minimize Risks• Source of Finance• Packaging Why should warehouse management be outsourced to 3PL?• Logistics optimization and scalability • Multiple warehouse and larger geographical reach• Time Efficient • Real Time Tracking and Insights • Warehouse space utilization• Better technology What are common problems in warehouses?• Poor warehouse structure• Poor inventory management• Poor management for seasonal demands• Poor order management• Excessive labor expenditures• Poor damage control Does WareIQ offer warehouse management?Yes, warehouse as a 3PL fulfillment service provider offers efficient warehouse management.
April 29, 2022
10 Types Of Warehouses in eCommerce & How Does it Work in 2024
What comes to your mind when you think of “eCommerce Warehousing”? Typically, we think of a huge shed-like space with an unsightly number of racks and shelves, goods and containers strewn all over, amidst a monotonous surrounding. It is important to note that there are many types of warehouses and it may be surprising that typical modern-day eCommerce warehouses are the complete opposite. They are clean, brightly lit, well-organized, and filled with an unending buzz of frenetic activity. People, parcels, technology, monitors, goods carriers, and mini-cranes, the list is endless. Read further to get a better understanding of the different types of warehouses in eCommerce and which would be the right fit for your business. What are Warehouses? The concept of warehousing: The formal description of eCommerce warehouses is that they are huge structures such as a building or shed that houses goods and cargo (both raw materials and finished goods) till they are ready to be shipped further. Naturally, the sizes, locations, infrastructure, and scale of warehouses vary greatly depending on what they are used for, the position they occupy in the fulfillment network, and so on. Several elements impact the selection of the type of warehouse you should choose, such as the industry it serves, what its ecosystem looks like, and locational and definitive business requirements. Importantly, all this directly impacts achieving customer satisfaction, which is the ultimate metric of a successful business. The eCommerce warehouse is an important cog in the order fulfillment wheel – it not only stores inventory but also forms a close working relationship between online firms, its distribution model, and the final customer. A strong network of eCommerce warehouses is critical-to-success for eCommerce firms. Third-Party (3PL) logistics, warehousing, and fulfillment centers: 3PL fulfillment companies conduct a host of services for their clients. Typical examples are inventory storage, order receipt, processing, dispatch, and cross-docking. Given the range of services and scale that 3PLs offer as a one-stop shop, it enables the supply chain to function more efficiently, faster, and more economically. As a result, its clients can focus on running the core elements of its business, i.e., sales, consumers, logistics innovations, profitability (etc.) without any extra hassle. When an online retailer outsources its warehousing and eCommerce fulfillment requirements to a 3PL, its capabilities - across locations, inventory, trained employees, optimized cost structures and compliance - help firms achieve seamless and efficient warehouse logistics. In addition, your 3PL’s warehousing capabilities should keep pace with your expanding needs as you grow. Additionally, you can learn about different types of warehouses here. [contactus_gynoveda] What Factors Do You Need to Keep in Mind While Choosing a Warehouse in 2024? When contemplating starting a new eCommerce business, or a business of any sort that involves the movement of materials and goods, your warehouses and fulfillment centers become an invaluable element for success. Not only must they synergize with your business strategy, but must also tick all the checkboxes that matter. Listed below are some leading factors that you must consider while selecting between the types of warehouses for your business: Efficiency in design and layout Firstly, the design and layout of your eCommerce warehouse must be determined by your requirements, i.e., the type of goods, the storage guidelines, government rules (etc.). You shouldn’t put the cart before the horse. Not all eCommerce warehouses are built equal. For example, if an old building with limited column spacing or ceiling height would affect that type of cargo and your eCommerce warehouse operations, then other types of warehouses would be better suited for you. Select the one's where the design has been developed, keeping in mind the flow of raw materials into eCommerce warehouses and, likewise, the flow of goods outwards. These warehouses are hubs of activity. People, machines, technological equipment, electrical connections, various controls, and many other components are all working in close proximity. As you would imagine, many of these elements could create a dangerous scenario for life and property if not managed properly. Therefore, make sure to check for an ergonomically designed layout that would ensure a seamless and efficient union of man and machine. For example, rough surfaces or sharp edges of shelves must be eliminated. Availability of workforce By extension of the point above, they employ hundreds of workers who work around the clock. Selecting a warehouse because they are cheaper and whose locations are mostly in remote areas may affect your ability to attract workers or cause them difficulty in their daily commute, and safety, even if you plan on moving your existing workforce from one location to another. Therefore, selecting a location that is easily accessible by your workforce is generally a key criterion for choosing the types of warehouses. Locations with a dense population and the presence of convenient transportation hubs generally score highly while making this selection, especially the latter. Even if commuting takes some time, at least it is made convenient. If your requirements have seasonal variations, then living quarters, canteens, banks, grocery supplies (etc.) to facilitate your workforce also become important. Operational intensity The intensity of operations and which way this intensity will go in the future is another important consideration. If your operations are light enough, then you can select the type of warehouses accordingly. Other variables such as outdoor facilities for storage, noise pollution caused, emissions (etc.) form a part of the consideration set when choosing a location(s) for your eCommerce warehouses. Accessibility to transportation Unless warehouses for eCommerce are closely connected with convenient modes of transport, it would be self-defeating. Remember that transportation makes up about 20-25% of your operating cost and directly affects the delivery times you can achieve. For goods that are fragile or need temperature-controlled transportation, poor accessibility would mean additional difficulties. Whether air, water, rail, or land - whatever your needs are, it is important that the location of your warehouse is easily accessible. For example, if you deal in heavy cargo across international borders and use ships to carry your goods, you would likely need a strong road or rail network to complete the cargo movement (both inward and outward). The capability of handling material Again, the type of products, cargo, and materials that make up your business will always be the determining factor in the types of warehouses you select. If fragile items (e.g., art, crockery, glass, and jewelry) are your main line of business, then ground floor locations are ideal, or at least not on a much higher level. In such cases, the layout of eCommerce warehouses should be spread out horizontally versus one with several floors. If hazardous chemicals or materials form part of your cargo, then you will almost certainly have to use locations that are peripheral to the city. Most governments also have guidelines that regulate the layout and location of different types of warehouses, depending on the inventory. Equipment, cross-docks, and staging facilities are critical in material handling, and you must consider this while choosing a warehouse. Available data makes it painfully evident that a significant percentage of breakages and product damage occurs during loading and unloading procedures. If trucks are your first mode of transport, then eCommerce warehouses must have depressed docks, which may need to be internal, and so on. Similarly, one cannot operate a vast distribution network unless the warehouses have cross-docks. Availability of space Well, this is probably the most obvious requirement of all. Unless eCommerce warehouses are sized to house your entire inventory in all its various shapes and sizes, they haven't fulfilled their most basic requirement. For companies starting or expecting to grow rapidly in the future, the capability of different warehouses for expansion is important. The network maintained by your 3PL is also important – you wouldn't want to select a 3PL that doesn't operate fulfillment centers or warehouses in locations you expect to grow into. Ability to comply with regulations Just like all aspects of business operations have to comply with their applicable rules and regulations, so do eCommerce warehouses. Before selection, you must be aware of the applicable laws in your location and ensure that your warehouse provider adheres to them. For example, you cannot store certain types of goods (e.g., hazardous materials) in certain areas. Or, you may need to hire local workers for your eCommerce warehouses. Proximity to customers Naturally, proximity to your end customers is an important consideration. If your target group is located around a specific region, using warehouses for eCommerce activities in that area itself will offer a strategic advantage. You can fulfill their needs quickly, better understand their requirements, and get accustomed to their purchasing habits. What Advantages Do Warehouses Offer? There are many advantages of using a capable and well-organized network of eCommerce warehouses. Let's look at some important ones: Operational efficiency When you outsource your warehousing requirements to a 3PL firm, you are aware of the capabilities of their services. The relationship is based on a well-defined SLA with clearly defined expectations from both parties. Therefore, once up and running, your partnership enables you to achieve an efficient operation quickly due to: ExpertiseFlexibilityMeasurability The combined impact of all these factors results in a significant saving of time and resources. Inventory management Your warehouse management service's driving objective (WMS) is to keep your customers happy. That means delivering their parcels safely, on time, and at competitive rates. Additionally, customers want to be kept in the loop about the progress of their parcels. Therefore, WMS ensures real-time information on parcels in transit and identifies them with a host of trackers such as SKU, batch details, serial numbers, etc. Data about the movement of goods, to and from eCommerce warehouses, is updated in real-time. The combined effect of all this is that your entire inventory management, including re-order levels, reverse logistics, current and developing trends, and projected requirements, is taken care of. This is very important for retail warehouse since it helps them understand consumer behavior, plan for future requirements, expand their range of products, etc. Flexibility If you decided to retain your warehousing and storage as an in-house function, you would potentially be limited by your ability to handle extraordinary circumstances or obstacles. For example, if an emergency were to arise or a larger-than-anticipated order was received, you would need to dedicate additional resources to handle such a situation. Possibly, workers wouldn't be trained or have enough time to handle the situation successfully. Because of this, partnering with a 3PL for your warehousing needs would set you up to benefit from their capabilities. 3PLs are vast global organizations that deal with a wide range of clients, ecosystems, and geographies. Due to their scale and experience, they are supremely equipped to handle a vast array of functions and annul potential problems. Risk mitigation As you would've guessed by now, running operations of eCommerce warehouses isn't an easy task by any means. It requires significant investment, expertise, a large workforce, the latest technological systems, employee recruitment and training, and tax and legal compliance. While the scale of business offers profit and acquires market share, it also brings risk, i.e., the costs of failure such as being upstaged by competition, being made obsolete by innovation, or just being forced out by better, more efficient players and also a potential increase in logistical costs. Such significant expenses, including CapEx, when locked by order fulfillment and warehouse service activities, create inefficiencies that will show up in your business results sooner than later. However, using efficient warehouse services achieves the exact opposite, i.e., it takes away the risk of investing and maintaining your network of eCommerce warehouses and allows you to concentrate on managing the core business. Over a period of time, this improves profitability and productivity. Therefore, make sure you analyze your needs accurately and select the right 3PL accordingly. Modern technological systems Just like the very birth and growth of modern-day eCommerce behemoths is a result of progressing technology, so are the benefits offered by 3PL warehousing services. Fully integrated systems seamlessly connect with online platforms and stores. Some examples are given below: Order management (receipt, processing, delivery)Order-delivery servicesComprehensive distribution servicesOrder trackingInventory management in real-time Automated re-order levelsDetailed and automated reports What are the 10 Types of Warehouses to Look for in 2024? Let’s look at the top ten types of warehouses. While each has its pros and cons, your business requirements determine which one would help you run your operations in the best possible way. Private Warehouse Source As the name suggests, they are types of warehouses that are owned and operated by manufacturers, traders, and resellers and are exclusively used for their supply-chain management and activities. As the costs and fees of availing the benefits of private eCommerce warehouses can be high, many warehousing companies prefer to use (or combine them with) the services of public warehouses. Maintenance costs include fixed costs and variables. CapEx, insurance, taxes, interest, etc. make up fixed costs, whereas outgoing monthly costs like operating/maintenance are variable. Firms typically use private eCommerce warehouses for: Building a competitive advantage over the competition Servicing a geographic area with an elaborate network of warehouses and fulfillment centersMatching company scale/ growth requirements with the warehouse’s services and capabilities Typical examples of private eCommerce warehouses include: Producers (e.g., farmers) construct and manage eCommerce warehouses near their farmlandsWholesalers/ Retailers construct eCommerce warehouses close to their distribution and selling centers, or production unitsRetailers take eCommerce warehouses exclusively on rentWholesalers lease or own eCommerce warehouses exclusively Public Warehouse Source Public warehouses are types of warehouses that enable their customers to achieve a high degree of freedom of operations in managing their supply-chain network. Since private eCommerce warehouses may not be affordable, this option is always viable for such firms. Naturally, renting or buying is often unaffordable for eCommerce startups. Therefore, utilizing public eCommerce warehouses on a short-term or long-term lease, usually available by monthly agreement, becomes a viable option for such small businesses. Agreements could be based on cost-per-square-foot or even on a cost-per-pallet. Generally, warehouses for eCommerce will also offer services like building maintenance, organizing transportation, inventory management, and employing workers to manage operations etc. It works out well since all costs are apportioned across several clients, and you pay a proportionate amount. Distribution Center Source Distribution centers are types of warehouses that have become a critical cog in the eCommerce supply-chain wheel. Due to the increased usage of technology and electronic tools, these distribution centers can now provide reliable and efficient transportation for cargo. Typically, such distribution centers have a much larger storage capacity than just a warehouse and provide prompt transportation facilities for huge volumes of cargo, on short notice. These centers are also located close to transportation hubs to optimize the speed of receipt and delivery. An ideal example is the distribution of highly perishable products, e.g., fresh vegetables and fruits. The receipt, sorting, and packing/ repacking of such products are done within a working day to minimize wastage. Cold Storage Source Understanding the type of storage this type of warehouse provides is pretty transparent. Cold-storage facilities are types of warehouses that are critical for temperature-sensitive products such as medicines, pharmaceutical products, fresh produce, ice creams, plants, meat products, etc. Perhaps, the importance of such a facility was recently reinforced when the Covid-19 vaccines had to be transported and stored under stringent temperature control measures. This goes a long way in ensuring the projected shelf-life for these goods. Pick, Pack & Ship Warehouse Source When eCommerce warehouses receive an order – whether from a physical store or an online portal – the process followed thereafter is to “pick, pack, and ship” the product. And, hence these are types of warehouses that are named after that process. They use modern gadgets like scanners and workers/robots to pick the products, required to fulfill their list. These "picked" products are then packed, tagged, and loaded into containers and shipped to their destinations. Read our blog on shipping aggregators to understand how you can outsource your shipping and distribution requirements to dedicated companies. Smart Warehouse Source Smart warehouses are types of warehouses that have increased in importance in the Modern Age, where everything is run by rapid advances in technology. The very existence of new business models such as eCommerce and the "App Economy" gives us daily reminders of this sensation. Additionally, tools such as data analytics, Artificial Intelligence, and Machine Learning provide the backbone for running these modern, tech-driven ecosystems. Smart eCommerce warehouses are no different. When businesses seek to eliminate the costs of human error, smart eCommerce warehouses become a go-to option. Extensive use of drones and robots is deployed in warehouse operations, and manual intervention or usage is minimized or eliminated. However, this model does have some limitations and has stringent requirements for successful operation - the entire warehousing procedure needs to be redesigned so that the technology can be incorporated. This requires technical know-how, and upfront investment and necessitates training/retraining of warehouse employees. Breakeven and profitability may take several years. Bonded Warehouse Source Bonded warehouses are types of warehouses that can be owned by both private and government agencies and are a mechanism utilized by the government to ensure that the importers/exporters of these goods pay their due taxes on time. Without paying their taxes or duties (e.g., import duty, excise), an importer cannot even open their goods, let alone claim them. As you can imagine, bonded eCommerce warehouses have a crucial role to play in cross-border trade, and those eCommerce firms that supply orders across international borders are well-served by them. This also works well for importers that can stock their goods here until they find a buyer for these products. Since firms do not have to pay any duty till they want their goods released, it works efficiently. For private agencies to operate bonded eCommerce warehouses, they need to get the required licenses as issued by the government. Climate-Controlled Warehouse Source If you think that simply a temperature-controlled environment for your goods isn't enough, then climate-controlled eCommerce warehouses offer the next level of protection during storage. They are types of warehouses that control the temperature and humidity under which your goods are stored. For many products, the correct humidity levels prevent mold or mildew formation, which harms fabric, wood products, paintings, and artifacts, amongst many others. Both humidity and temperature are controlled to a stringent standard, and the variances allowed are minimal. This ensures a consistent atmosphere. Cleanliness and overall facility upkeep are important features that climate-controlled eCommerce warehouses must be particularly mindful of. Government-Owned Warehouse Source They are types of warehouses that the government, whether State, Central, or an affiliated agency, owns and manages. They are available for use by private eCommerce firms and often present an economical option for startups or businesses that are growing while effectively offering the same services. Importantly, they offer peace of mind since the government manages them. The Central Warehousing Corporation of India is a renowned example. Cooperative Warehouse Source Cooperative Warehouses are one such type that are owned and managed by cooperative societies. They tend to be non-profit since their objective is to promote members of the cooperative, who can use these warehouse services at reasonable rates. Milk, winery, and farmer cooperatives are good examples. eCommerce firms that operate within their purview can take advantage of such types of warehouses. Conclusion: Does Your Business Need a Warehouse? Well, as evidenced by the above article, you should be able to see the numerous benefits that a well-researched, efficiently managed, and elaborate network of eCommerce warehouses brings to your eCommerce business. While there may be cases of companies (e.g., a fledgling startup) that may make do with an in-house option (e.g., garage, basement) in the initial stages, growing companies will almost always opt for type of warehouse that suits their requirement and adds value to their business. WareIQ is a company that offers many ecommerce warehousing services that your business requires. Established in 2019, WareIQ, a Y-combinator backed startup, has rapidly grown to be the leading provider of full-stack eCommerce fulfillment services for some of the most reputed brands in India. WareIQ offers a full-stack platform for eCommerce companies to enable same-day delivery and next-day delivery to customers – an Amazon Prime-like experience but accessible to everyone. WareIQ fulfillment is a service where WareIQ offers you seamless management of your inventory and order fulfillment operations in WareIQ fulfillment centers, which are located near high-demand clusters. You store your product in our fulfillment center where we take utmost care of your inventory. WareIQ has customized offerings for merchants experiencing different order volumes as well as having different delivery speed expectations. WareIQ is probably one of the very few fulfillment tech companies in the world that have same-day delivery service for their customers under their product “WareIQ RUSH”. WareIQ's warehouses are present across the nation. We place inventory closest to your customer using a smart inventory placement system based on AI-ML algorithms. So when the customer places the order, the item is available in the closest fulfillment center to them and it is then delivered by same/next day via our shipping partners. [signup] Types of Warehouses FAQs (Frequently Asked Questions) What are the different types of warehouses?• Private Warehouse • Public Warehouse • Distribution Center • Cold Storage Pick, Pack & Ship Warehouse • Smart Warehouse • Bonded Warehouse • Climate-Controlled Warehouse • Government-Owned Warehouse • Cooperative Warehouse What is the difference between warehouse and warehousing?A commercial building generally used for storage of goods and is used by wholesalers, manufacturers, exporters, and more is a called a warehouse and the process of proper storage and handling of products and cargo using scientific methods in the warehouse is referred to as warehousing. What are the different functions of an eCommerce warehouse?• Storage of products• Taking care of goods• Transportation of goods• Management of finances• Value-added services • Information management In a warehouse, what exactly is warehouse logistics?The physical flow of products during receiving and shipping, as well as the data connected with this flow, such as delivery times or product information, is referred to as warehouse logistics. Which warehouse is best suited for my business? Does WareIQ provide warehousing service?The purpose of each warehouse has its own requirements and needs. Whichever warehouse you opt for, ensure to keep both your short-term as well as long-term distribution needs in mind.WareIQ has a vast network of fulfillment warehouses, dark stores that allows online brands to store inventory closer to their customers enabling same/next day delivery. WareIQ also provides warehouses with cold storage facilities & also offers custom packaging when requested by the online & D2C brands
April 27, 2022