How should you manage your inventory?

Managing Inventory

Having an organized inventory is essential in Third-Party Logistics. Why? Simple. It not only ensures a great customer experience, but a thorough warehouse makes receiving, picking, packing, and shipping easier and smoother. Without regular maintenance, no effort you put towards organizing your warehouse is going to have any long-lasting effect.


Optimize your inventory

The most frequent causes of inventory fulfillment issues are related to human errors from manual processes. Also, the lack of accurate, timely information about inventory in the warehouse can affect deliveries to consumers and order fulfillment rates severely. Most of the times, the implementation of a Warehouse Management System (WMS) is the best option to avoid these kinds of problems.

What is WMS?

WMS stands for Warehouse Management System, a software that allows organizations to control and manage warehouse operations from the moment goods or materials enter a warehouse until they move out. The execution of warehouse management lets an organization improve its competitive advantage by minimizing labor expenses, enhancing customer service, improving inventory accuracy, increasing flexibility, and providing responsiveness.

This software contains a detailed description of warehouse essential elements:



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Having real-time inventory visibility can help providing your customer service and operations team, as well as 3PL customers, the information they need to make more effective decisions. Here are some tips for having an organized inventory:

  • Label

Nothing should be stocked without a legible barcode label, which should then be used for tracking its location within the warehouse. The designated label can be scanned, as items are put away, transferred, and picked, ensuring accurate communication with the Warehouse Management Software.

  • Easy-to-access areas

Place your high-velocity items in easy areas to achieve. Your workers are going to be accessing those items most oftenly, so by placing them in easy-to-access areas or close to the shipping area, you save on labor, time,  and equipment movement. This method applies to your top 10% to 15% of stock items.

  • Complete orders before the end of a shift

Give workers time to finish out orders, inventory entries, and get stock put away before the next shift ends. This will avoid either lacks of communication between teams, and discrepancies between your real stock and what your system shows.

  • Clean and sort

Everything that comes in should be put away on a shelf. Nothing should be thrust aside; packed materials should be cleaned up before the end of a shift, keeping everything in its place and ready to proceed to an order fulfillment.

  • Unauthorized personnel

No one should be in the warehouse area without a purpose and authorization. With this, you eliminate the possibility of stock getting moved around without the knowledge of those who work in the warehouse.

  • WMS

As we said before, all items in stock should be clearly labeled and shelved in labeled slots that are tracked in a warehouse management system. This software makes managing inventory and maintaining stock organization much easier, no matter where or how much you are storing.

  • Daily checklist for warehouse managers

Maintenance of stock management equals daily attention. You must develop a checklist that managers use to ensure certain key tasks are done each day. This list can include: putting away a series of products, cleaning the floor or, as mentioned before, processing shipments before the end of a shift.

As you can see, a WMS is a great option to optimize your inventory. If it’s not clear yet, here are some benefits of this software that you should consider to get a serious improvement in your logistics business:

  • Warehouse space

A Warehouse Management System also regularly improves available warehouse space by systematically and effectively locating the products in terms of receiving, packaging, and shipping areas. It enables accurate stocking, slotting and pulling of orders, giving companies the opportunity gain higher-level insights into how much of each item is truly needed. Therefore, overstock is reduced, and understock is minimized simultaneously to save space.

In addition, Warehouse space often represents 15% to 20% of the cost per order. Moving to a new space is expensive and takes a lot of time. Make sure you have assigned someone responsible for your ongoing planning and warehouse space utilization analysis process.

  • Improved customer service

By optimizing the processes right from product order to shipment, businesses can more efficiently and accurately find the item availability and exact delivery dates, reducing errors in the order fulfillment process. In addition, the system ensures customers receive undamaged products, and promptly. The way we treat our customers is indicative of the way we look at things in life. Are we short-sighted, merely searching for the next pay day, or does our vision give us a deeper understanding of the long-term implications of our actions?

  • Warehouse design

It allows organizations to customize workflows and picking logics, making sure that the warehouse is designed for optimized inventory allocation. The WMS establishes bin slotting that maximizes storage space and accounts for variances in seasonal inventory.

  • Pick and pack

Zone picking, wave picking, and batch picking are some examples of a WMS pick and pack benefit. Warehouse workers can also use lot zoning and task interleaving functions to guide the pick-and-pack tasks in the most efficient way.

  • Shipping

The WMS sends bills-of-lading (a document given to a shipper by the carrier that describes the shipment info and serves as a means of transferring the title of goods) ahead of the shipment. This bills generate packing lists and invoices for the shipment, and send advance shipment notifications to recipients.

  • Quicker inventory turns

A high-grade Warehouse Management Software can attenuate your time by restricting inventory movement and enhancing the reliability of the inventory records.

  • Reporting

With a reporting option in the Warehouse Management System, managers analyze the performance of warehouse operations and find areas to improve.

  • Increased labor productivity  

WMS benefits workers as well! Employees that know exactly where products are shelved can reduce extra walking time, ensuring a continuous productivity at your warehouse. Moreover, workers can pick more orders in less time, increasing overall profit margins and efficiency in order fulfillment. In addition, WMS allows inventory putaway and retrieval, often with pick-to-voice technology, to help warehouse workers locate goods.

  • Reduces Security vulnearibilities


    Some people will try to steal or damage products intentionally. An effective WMS keeps methodical records of inventory. Besides, the system relies on user-specific logins, so managerial staff can ensure that workers are not slipping extra product out the door.

Types of WMS

Warehouse management systems come in a variety of types and implementation methods, depending on the size and nature of the organization.

They can also vary widely in complexity. Some small organizations may use a simple series of hard copy documents or spreadsheet files. But most larger organizations use complex WMS software, designed specifically for the size of the organization, and many vendors have versions of WMS products that can be scaled to different organizational sizes.

Did you know? Some organizations build their own WMS from scratch, but it's more common to implement a WMS from an established vendor.

WMS provider, let me ask you something...

Depressed businessman sitting under question marks

Asking the right questions to your Warehouse Management System provider will let you know if the software suits to your business. Try asking the following:

  • What can I expect during the installation process?
  • What kind of materials will I and my business need to provide in order to ensure the perfect implementation?
  • Is the system adaptable enough to grow as my business expands?

Remember to clarify all your queries!

In conclusion, a Warehouse Management System can improve your company's activity tremendously. Saving time and space are two pillars that you must consider to bet on, when it comes to business. Tip: don’t rush, take your time to choose the right WMS. After all, you won't regret it. Strike out!


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