Asking the right questions: a WMS RFP success guide
You’ve decided that you need a new warehouse management system.
There’s a whole lot of new functionality and features these days, from supporting the devices your staff and drivers already have to algorithms that suggest how to change inventory and shelf layout to maximize efficiency.
There are so many goodies it can get a bit tough to know where to start. That’s where this guide comes in, thankfully. We’ll walk through one of the best tools to get you going and help narrow down the list of potential vendors: the RFP.
Review the sections below to learn exactly what you’ll need to do and what to expect from WMS vendors to learn more about their software and determine if it could be right for you. We’ll touch on:
- What are WMS RFPs, RFIs and RFQs?
- How do you gather requirements for a WMS RFP?
- How do you list WMS requirements and create an RFP?
- What’s unique about software RFPs?
- How do you judge WMS RFP responses?
So, let’s dig in and take it slow. This is one of those times you’ll want to rush to find a vendor, but finding the right vendor will take a bit of time and patience.
This is a Request For Information, and it is simply a general inquiry to learn more about a market or service. RFIs help you gather information before you take any further steps or ask for specifics. In the case of a WMS, you might want to send out a general RFI for your industry. This can be a basic posting or email that says: Do you have a WMS designed for 3PLs?
RFIs go out to a large list of potential partners or vendors, allowing you to do a cull of vendors who can’t meet your basic needs or aren’t interested in your business.
A Request for Quote is a request you send out to learn about purchasing a service or commodity at a standard rate. This would be something that is a uniform cost and doesn’t require customization or tailoring to your business outside of what’s a standard customization option.
So, you’d use an RFQ to discover prices for new handheld scanners or RF gates that work with a specific piece of software because vendors could quote you a specific price. RFQs work best when you’re dealing with something that’s commoditized.
Think of it as something you’d order again at a consistent time interval. If it fits, then an RFQ would work. If you have unusual requirements, like specific contract terms or adjustments to core mechanical components and software, an RFQ wouldn’t be specific enough.
Requests For Proposals are the meat we’re after in this guide. An RFP allows you to ask vendors to look at your custom set of needs and respond with information about the services or software they offer. The RFP is truly tailored to your situation and allows you to ask about customizations and list out a wide range of needs. You’re asking for more than just an item; you’re asking for support in your long-term and short-term business needs.
When is an RFP actually required?
An RFP is needed for every major decision where you’re looking for something to add value to your company. In this case, that means your WMS. To make the most of your investment, you’ll need to customize the software and ask a lot of questions about its data, dashboards, software it integrates with, customer visualizations, and much more.
You’ll likely have a custom warehouse management system functional requirements list by the end of this journey. Whenever you have something as detailed as that for your business, it’s time to put together an RFP.
If you’re at the stage of considering a WMS RFP, then you’ve likely made sure you need a new platform. Whether it’s moving away from manual processes or getting a new platform that can meet your growing needs, you’ll want to crystallize the reason driving the change.
Once you’ve got the reason together, shop it around with your RFP team and leadership to make sure everyone else is using the same logic and reasoning as you.
Start with your team
Even before you get to a WMS functionality checklist, you can make or break the entire process by having the wrong people on your side.
Senior management is needed to ensure you have the right company mission goals and funding. Warehouse teams need a voice, so you know which functions to focus on most. Your IT department can help you know if a request and a bid are realistic. Sales and marketing can also chime in on what’s best for order management and maintaining high levels of customer service.
"Even before you get to a WMS functionality checklist, you can make or break the entire process by having the wrong people on your side."
Get stakeholders from these departments as well as any others who might need to use the system or its data. And, the more leadership you can get to approve the RFP process initially, the easier it’ll be to justify the cost when you’ve made your vendor choice.
Discover WMS system requirements
We’ve built an entire guide just for WMS requirements and features because it’s a massive list with plenty of things you will and won’t need. We recommend you use it to find the right core functions that you need for your system.
To turn this into a warehouse management system checklist, you’ll want to review the WMS requirements with your team members. Here are some steps to take:
- Review each of the core sections, like Picking and Receiving, and write out who is involved in the process.
- Take note of what data is used to start each process and what data is collected as the process is complete.
- Review data with your IT team to see if it is used elsewhere.
- Ask staff to look over each area and see what functionality could be handled by the WMS.
- Create a list of needed functionalities and build out an appropriate list of requirements.
- Ask your team to review these requirements.
- Look for chances to be specific in your list, such as needed support for three large and one small warehouse, fleet management for under ten assets, average orders per day or week, or your current (and desired) rate of fulfillment per hour.
- Ask your team what they might expect to see change in a year and record what you might need then.
You want to build your requirements first from internal reviews and interactions. Afterwards, you can look at some systems and online materials to see what else is available. You might not realize that there are some support options available — such as new handhelds and scanners or mobile applications that can use trucks and vans as mobile warehouses for field services companies.
It’s also a good idea to review industry-specific requirements and capabilities. You might not need a separate system for recording some data anymore, or you could find a WMS that integrates with industry-specific auditing and review software that your vendors or customers require.
Separate your wants from your needs
Part of the RFP process involves showing WMS companies that you’re serious about spending money. So, you want to make sure your RFP covers everything you need from a functionality and user standpoint.
What you don’t want to do is create a list of items that you want in a perfect world and then follow it up with a slew of pricing questions. Having a few aspirational items in the mix is okay. However, if meeting everything within your price range sounds too good to be true, it probably is.
You don’t want to accidentally weed out top service providers by asking for the moon at the cost of a block of cheese.
Grab something like a WMS requirements template to start sectioning out your needs. List elements by section and try to mark what’s a priority for you or any timeline requirements you have.
Stick to the common, major categories that warehouse professionals are familiar with:
- Order fulfillment
- Inventory management
- Workforce management and training
- Asset management
- Transport management (think carrier selection)
- System supports (SKUs, labels, batching, kitting)
- Supported locations (multiple warehouses of diverse types)
- Reporting and analytics tools
- Hardware requirements
- Software requirements including integration options
- Supported devices
- Mobile platform support
- Deliver platform (on-premise, cloud, hybrid)
- Specialty needs and functions
Allow your warehouse team to take the lead on figuring out where each element goes in your list of categories. When possible, note the core functionality in each section and separate out what you would consider but don’t necessarily need.
One area not to overlook is asking about each vendor’s company. Look at their years in business and satisfied customers, plus customers who will provide a testimonial, or ask about user groups and information available on the web. Check out their website and digital platforms too.
In this day and age, you’ll likely be interacting via websites, portals, emails, and chats more often than a phone call. If the existing user interface is confusing or skimpy on their site, the WMS might not be dissimilar.
Create space for answers
The space you leave for vendor responses will typically come in one of two flavors: a box using predetermined codes for things like out-of-box support or available through a third-party integration; or open space for an unstructured, free-form answer. Aim for a combination of the two.
It might be easiest to sort your RFP answers if you turn the must-haves into boxes for codes or checkmarks while giving vendors a space to explain more detail and provide a vision for you in each section or for special requests.
Share what you create with your team before sending it out so that you can get a WMS RFP template critique from all of your stakeholders.
A customizable WMS RFP template
Here's a basic structure for a WMS software RFP. You'll need to customize it a little before it's a perfect fit for your company, but it's a solid starting point.
|Section||What to include|
|Project purpose||Tell the vendor why you want a new WMS and tie it to fundamental practices of your business. This is where you show why a WMS is valuable to you and why you want to know more than just how much does a WMS cost.|
|Project timeline||Create a list of steps for a new WMS and provide a timeframe for each step. It’s okay to break down large sections into a series of smaller steps, but putting too many time constraints on those smaller steps may cause some vendors to treat your RFP with concern.|
|Requirements||Cut your WMS needs into large areas and give each a separate section within the RFP. Discuss needed functionality within each area and provide some ranking for which are required and if any are reach functions. You can also specify if you want some functionality to work out of the box, where you need custom development, and what functionality you don’t need now but may grow into in the future.|
|(Suggested sections for requirements)||
Here are just some of the areas you should specialize functionality within:
|Other vendor qualifications||Look outside the WMS and ask about what you want in a partner. This can include what their support looks like, the uptime of their cloud services, company culture requirements, how many engineers they have on staff, how often they release patches and updates, or how long your main point of contact has been in their position.|
|Proposal evaluation criteria||Tell your vendors how you plan to review their responses and how you’ll apply a ranking to the different criteria you have. Two important things to note here are: the RFP response date should be a non-negotiable criterion, and you’ll want to make sure vendors see you as a potential partner instead of someone only concerned about WMS pricing. If you treat the WMS as a commodity, you’ll get lackluster responses.|
Every list of needs is unique, so there’s no uniform answer of selection criteria every WMS can rely on to get each item. Software further complicates things because many variances aren't easy to understand or state in an initial RFP.
Think of how complicated it can be to implement a new system and integrate it with your existing software. Sure, I can give you a price and time estimate, but things almost always come up — so you want someone who will acknowledge the possibility instead of meeting a specific mold.
"Software is notorious for having scope creep and issues with implementation today, as well as problems that come with updates down the road"
However — I love a good caveat — there is one question that’s important for all software RFPs: total cost projections for your first year and time after.
Software is notorious for having scope creep and issues with implementation today, as well as problems that come with updates down the road. So, if you’re only focused on the purchase price, you might be skewing your budget significantly and end up with a system that’s too expensive to keep using next year.
Ask for a projection that includes all of the costs that you’ll face. It’s okay to tell your software vendor that the estimate doesn’t have to be 100% accurate. But, what you want to see are:
- Licensing costs you’ll accrue
- Maintenance costs that shift after the first year
- How much you’ll pay if your users grow
- Upgrade fees
- Customization fees
- Special hardware requirements
- Training costs
- Peripheral needs
- Costs to add new features or modules
- Costs to remove modules
- Projected integration fees
Remember, these can change based on the key features of the WMS you want. That means you need to provide plenty of detail in your RFP to avoid unexpected increases.
Software can be a terror for any budget. Protect yourself by asking as many questions as you can about the types of fees and costs that come with a WMS.
Now comes the hardest part, creating your WMS RFP template critique guide for every response.
There’s no effortless way to do things because you’ll be judging vendors on how they address your WMS functionality checklist as well as the overall vision they provide for your company and use of the WMS.
Prepare yourself by thinking about the type of partner you want to help create and manage a warehouse management system project plan. You want a process that focuses first on warehouse management system functional requirements and then narrows down based on culture and company fit.
There are a few general rules that we recommend for signaling a standout RFP response:
- They check every box you need as a must-have — or they provide a different but useful option for some functionality.
- They provide in-depth responses to your more complex needs, not just a yes or no answer for something complicated.
- You understand what they mean. The RFP is not the place for platitudes or buzzwords. Your “next-phase” pile should be a synergy-free zone.
- Cost estimates look beyond the install. This helps you budget for the long-term. It also shows that the vendor knows what matters to warehouses and is willing to be helpful.
- They are courteous and prompt when you follow-up with questions or for clarification. If they aren’t nice in the RFP process, there’s no reason to expect them to change during the more stressful implementation process.
A good way of evaluating responses is to create a scoring sheet and get each member of your WMS selection team to rank vendor responses to each RFP section out of five. A top score doesn't automatically mean you should shortlist for demo - but the responses that are worth following up on should rank highly.
The good news is that RFP responses aren't the end of things. You then get a chance to ask about how the vendor can help your business. You might get a more detailed demo using your data or similar data. You also have the chance to ask for specific estimates, timelines, and other concerns.
Taking the time to generate a strong RFP makes it easier to sift through the WMS noise and find a suitable partner. Make sure you get the process right.
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