Benefits of a Warehouse Management Solution
Growing up, I had a friend whose mother worked at Albertsons Grocery store as a check out clerk. Her evenings were spent studying the newspaper so that she knew all of the specials that were being offered. Armed with this information, she would proficiently enter customer sales with the correct pricing for all their purchases, including the sale items. Stock was taken by paper and manually entered into the main computer.
Today, with barcode capture technology and radio frequency terminals, the need for this extensive product knowledge and cumbersome inventorying is all but eliminated. The pioneers in the grocery industry such as the Albertsons and Safeways of the world used the technology to gain competitive advantage, and the smaller groceries who didn’t keep up are nearly non-existent today. Today, as Warehouse Management Solutions (WMS) are becoming more prevalent, those seeking a competitive advantage have nearly lost this window of opportunity. Now implementing a WMS is a matter of survival. With cost of errors sky-rocketing, customers demanding service levels of 100%, ever increasing cost of labor, and the difficulty in finding good help, distributors that don’t invest in a WMS to control warehousing costs will go the way of the Mom-Pop grocery store.
The paybacks of a WMS are obvious. Decreasing labor cost of 15% or more could save distributors hundreds of thousands of dollars a year. Eliminating errors also adds to the bottom line. Simple math shows that if you have 20 warehouse employees averaging $13/hr working five days a week, a 15% increase in productivity will save $81,120/year in operating costs. This means that you can run your warehouse with fewer staff or you can grow your volume with existing staff.
Gordon Graham says that an undetected error costs the average distributor from $75 to $150 per incident. If we take conservative estimates, say $50 per error, a distributor who has 98% shipping accuracy and is shipping 500 lines per day, five days a week is spending $130,000 per year on errors. By eliminating these errors, the money currently spent correcting errors heads straight to the bottom line. Eliminating errors not only cuts operating costs, but also provides superior customer service. Knowing that the customer will receive what they order without mistakes is often more important than cost to many customers, meaning not only improved customer loyalty, but also the ability to charge more for your product than your competitors, increasing margins.
Selecting a WMS
Evaluation of a WMS should go beyond the feature functionality of the solution itself. When evaluating WMS you should evaluate the people that surround the product. Who is going to implement the product after the sale? What type of support structure is set up to answer questions and resolve problems with the software? How many installations are up and running, and are they in companies that are similar to yours? What is the methodology of providing updates to the system, and if you are going to interface the WMS into your enterprise software, who is going to maintain changes in the interface?
These all are important aspects of the software, many times equally important to the feature functionality of the solution. A complete WMS solution is much more than the ability to support receiving, pick/pack and ship operations, cycle and physical counts and stock movements.
What About Infor SX.enterprise WMS?
Infor SX.enterprise Total Warehouse Logistics (TWL) is coming out of its infancy. Developed to address all major areas of a hard-good distributor’s warehouse, TWL has advanced functionality to handle receiving, putaway, product movements and replenishments, cycle and physical counts, picking, packing and shipping, as well as providing detailed reporting on warehouse activities. This functionality enables distributors to increase productivity by 15-30%, increase inventory accuracy to 99.9% and eliminate shipping errors altogether.
Infor SX.enterprise currently has over 100 warehouses utilizing TWL. All of these companies have at least one thing in common: they all use SX.enterprise as their distribution-centric enterprise software solution. The benefit to new TWL users is a proven and stable interface to their business system.
Implementation and Support
Infor SX.enterprise has taken a team approach to implementing and supporting the TWL product. Dedicated support consultants and implementation consultants focus on TWL only. These specialists come from warehousing backgrounds and have a strong knowledge of both Trend and TWL. This is beneficial so that whether the customer is having a Trend, TWL or a warehouse-related issue the consultant can address the problem quickly and efficiently, getting the customer running smoothly sooner.
The TWL interface is a standard offering within the SX.logistics product family and is covered in Annual Licensing Fees. This assures the customer that as changes are made to SX.enterprise or TWL, then Infor SX.enterprise will address issues with keeping the interface updated as well as ported to new Infor10 product offerings such as the Value Add Module and SX.enterprise.
Who to Contact
Every day that you put off controlling costs in your warehouse is a day that is costing your company money, customers, and competitive advantage. Contact us to have one of our consultants call you.