4 types of warehouse management software: Which is best for you?

When searching for the ideal warehouse management system, you've likely encountered various articles discussing different types of WMS. Understanding the nuances of each type is crucial to making the right decision for your business.

The four main types of warehouse management systems

Standalone WMS solutions

These focus solely on warehouse management, offering features like picking, putaway, slotting, and labor management. These systems operate independently, without requiring integration with other software. They are ideal for businesses seeking specialized functionality without the complexity of additional system dependencies.

Supply Chain Management (SCM) modules

Some warehouse management systems are part of broader supply chain software suites. These WMS types facilitate seamless integration across supply chain activities, optimizing warehouse operations as part of the overall logistics flow. They help direct and execute warehouse transactions efficiently within the larger supply chain context.

ERP-based WMS modules

Warehouse management systems embedded within Enterprise Resource Planning (ERP) solutions extend the inventory management capabilities of ERP systems. This integration allows for unified data handling, and streamlining processes across financial, procurement, and inventory management operations.

Cloud-based WMS

Cloud-based WMS solutions provide flexibility and scalability by remotely hosting the software and data. Businesses can access the system via the internet, eliminating the need for on-premises installations. This type particularly appeals to companies seeking lower upfront costs and easy scalability.

Selecting the right WMS for your business

While there are distinct types of warehouse management systems, the best choice hinges on how well a system meets your business requirements. Here’s a detailed breakdown of what to look for:

Ease of use

Your WMS should be user-friendly. Remember, warehouse staff (often without extensive IT expertise) will be the primary users.

Who knows what sequence the items are listed in? A WMS will signal your pickers to collect the same items in the sequence of your warehouse shelf locations. Further, the signal will indicate your SKU and not whatever your customer knows the product as. Your crew will save steps on the very first day.

Integration capabilities

Modern WMS solutions offer robust integration with tools such as barcode scanners, label printers, and counting scales. Real-time updates as SKUs are picked or stored improve accuracy and eliminate the need for manual data entry.

Data accuracy and security

A good WMS ensures precise inventory records, tracking on-hand quantities down to each shelf location. Whether your data is stored on-premises or in the cloud, strong security measures protect it from unauthorized access.

Flexible picking methods

Different warehouses operate differently, and your WMS should accommodate this. Whether you employ order-based picking, wave picking, or even automatic guided vehicle picking, your system should support your chosen method.

ERP and supplier integration

WMS systems use industry-standard data records and transaction storage so your WMS can integrate with other systems using compatible data and transaction standards. Your sales portal is running just how you want and customers are placing orders.

Linking your WMS with ERP modules and supplier systems provides a comprehensive view of inventory, including in-transit shipments and supplier statuses.

Key features to consider

You might need variable units of measure in your WMS. Is a case 12 jars or 24 jars? If you break cases, are the jars 16 ounces or 24 ounces? Does your supplier sell a product as a 100-pound barrel but you stock and sell that product by the pound?

Is the WMS scalable? It fits your needs today but can it grow to fit your expectations in five years? You have one warehouse today. In five years you expect to have ten warehouses and some of those you will staff with employees and others likely will be managed by third-party logistics providers.

WMS reporting might not be the first desirable feature to look for in your system, but it could be the most valuable in the long run. Reports can be statistical, such as the number of items picked each day. These will ensure that minimum requirements are met and allow for trends to be examined.

The importance of advanced analytics

Reports on future demands will help optimize the resources required for tomorrow. Comparison reports will show the differences between crew members' actual performance and work standards and help crew development and training where they are most needed.

Analytical reporting can examine whether the best practices are being used. Are the rules established for slotting the best rules for the work we expect in the future? Would major changes such as warehouse layout or implementing automated guided vehicles make sense for this warehouse?

What trends can we find in customers ordering the most profitable products? What can be done to minimize left-over, unsold inventory? Are there better ways to dispose of those products?

Choosing the best WMS for your business

Ultimately, your goal is to find a WMS that enhances your warehouse operations, ensuring customer satisfaction and business profitability. Whether you opt for a standalone WMS, an SCM module, an ERP-integrated system, or a cloud-based solution, the key is alignment with your specific needs.