If you run a third-party logistics (3PL) operation, you know how important it is to have an efficient warehouse, especially during high selling seasons. The success of a 3PL business depends on the ability to receive, store, pick, pack, and ship their clients’ products as quickly and efficiently as possible. That’s why so many 3PL companies are turning to warehouse management systems (WMS) to streamline their operations.
In this article, we will explore how a WMS can increase efficiency in 3PL operations, the benefits of implementing a WMS, and the factors to consider when choosing the right WMS for your business.
A WMS is a software system that aids warehouse managers with a way to control and optimize warehouse operations. The system’s most powerful strength is its ability to provide real-time visibility into inventory levels, locations, and movements. This helps managers make better decisions and reduce errors.
By automating various warehouse tasks, a WMS streamlines everything from order fulfillment and shipping to stock counting and replenishment. Accurate inventory management is at the core of efficient warehouse operations: with a WMS, you gain real-time insight into what’s on hand, where it’s located, and how fast it’s moving out the door. This minimizes the risks of overselling, stockouts, and costly overstocking.
The advantages go beyond just inventory accuracy. Automation reduces manual errors, lowers labor costs, and frees up your team to focus on higher-value activities. As a result, your warehouse can handle more orders, optimize storage space, and ultimately improve customer satisfaction – all while keeping operational costs in check.
For third-party logistics providers, managing inventory across multiple locations can quickly become complex without well-coordinated processes. A warehouse management system (WMS) helps simplify this by offering a centralized platform that tracks inventory in real time – whether it’s in one warehouse or many. With full visibility into every pallet, box, and SKU, WMS enables 3PLs to operate with greater accuracy and control.
This level of visibility unlocks several benefits:
So, why is a warehouse management system often seen as the golden ticket for businesses trying to stay ahead in a competitive market? It all comes down to visibility, accuracy, and speed – three things no growing logistics operation can afford to overlook.
First, a WMS gives you instant, real-time insight into your inventory. No more guessing games or late-night manual counts. With up-to-the-minute data, you can make fast, informed decisions about reordering, stock allocation, and space usage. This accuracy helps prevent both costly stockouts and overstocking, leading to better cash flow and a leaner operation.
Next, automation is where the magic happens. By streamlining core processes, a WMS helps eliminate manual errors and dramatically speeds up fulfillment. Technologies like barcode scanning and lookup inventory functionality make locating and processing inventory a breeze for your team. The result? Faster order turnaround times, reduced labor costs, and happier customers.
Finally, operational efficiency isn’t just about moving boxes – it’s about making the best use of every resource in your warehouse. With a WMS, repetitive manual tasks are minimized with automation, allowing your staff to focus on higher-value activities. This means you can handle increased order volume without missing a beat and adapt quickly to changes in the market.
In short, with a WMS in place, your business is better equipped to deliver accurate orders, quickly and reliably. And in today’s ultra-competitive landscape – where giants like Amazon and Walmart have set the bar for logistics – having that edge can make all the difference.
When it comes to warehouse management, having access to real-time data is nothing short of a game-changer. A robust WMS empowers managers to see exactly where inventory stands – right down to the last pallet – without sifting through spreadsheets or chasing down paper trails. This isn’t just about knowing how many bits and bobs are on the shelf either. It’s about instantly tracking stock levels, pinpointing product locations, and following inventory movement from the minute goods arrive until they ship out the door.
Why does this matter? Because with real-time insight, you don’t just react to problems – you anticipate them. If a popular item is running low or a pallet is misplaced, you’ll know about it before it turns into a larger issue. This leads to fewer stockouts, less overstock, and much less frantic last-minute firefighting. Tasks like replenishing inventory, rotating stock, or triggering product recalls become far more precise and timely, minimizing the risk of costly errors.
Beyond inventory control, real-time data helps optimize the entire workflow – from receiving and storing to picking, packing, and shipping. In other words, this means you can spot bottlenecks, identify slow-moving SKUs, and streamline processes on the fly.
And perhaps most critically, real-time data in warehouse management leads to better decision-making. Because when you have up-to-the-minute order status and shipping updates, you’re better equipped to make quick adjustments – whether it’s redirecting a picker, updating a customer, or coordinating with carriers like USPS or FedEx. The result is improved accuracy, lower costs, and a warehouse that runs like a well-oiled machine.
Now let’s take a closer look at the core functionalities you’ll find in most WMS platforms and how each can make a difference in your daily operations.
A WMS typically includes functionalities like receiving, put-away, picking, packing, and shipping. Let's take a look at these functions individually and see how they can benefit you and your business.
The receiving process is generally the first step in a warehouse operation. With a WMS, the receiving process becomes more streamlined because it can both identify the incoming products and match them with open purchase orders with the help of barcodes.
Also, if you sell food, supplements, or any other product that has a lot number or expiration date, those records can be captured during the receiving process.
After products are received, they will need to be put away into its designated location in the warehouse. A WMS can help with the put-away process by providing default locations for specific products. Also, if you have more than one warehouse, a WMS makes relocating or splitting stock even easier to different locations.
When an order comes in, the products in the order must be picked and then packed for shipment. A WMS can help optimize this process by supporting two ways for your team to pick orders:
The last and final step in the warehouse operation is shipping. A WMS can help optimize the shipping process by selecting the best carrier and shipping method based on factors like delivery time and cost. Also, some WMS platforms (like Zenventory) can provide additional benefits like access to discounted rates.
Implementing a WMS can bring many benefits to a 3PL operation, including …
A WMS can automate many manual, tedious tasks like data entry and product tracking. By automating this process, you can save precious time and reduce errors, but that is not all. With an automated process, you can also expect to optimize your current workflows, like picking and packing, improving efficiency, and reducing labor costs.
In addition to streamlining these everyday tasks, automation in a WMS extends to inventory tracking, order processing, and shipping. For example, barcode scanning can enable your team to quickly and accurately process orders one scan at a time, leading to faster order fulfillment and fewer shipping delays. This boost in speed not only enhances productivity but also contributes to greater customer satisfaction.
By reducing reliance on manual entry and minimizing human error, a WMS also allows your staff to focus on more valuable activities and helps you allocate resources more effectively. Ultimately, this means your warehouse can meet customer demands more efficiently and gain a competitive edge – all while keeping operational costs in check.
Always know your inventory levels and make better decisions with a WMS. Gain real-time visibility into inventory levels and locations and help your team make better decisions and improve productivity by making information more accessible. A WMS can also reduce the time it takes to fulfill orders by creating an efficient walk path for pickers sorting by location. Faster fulfilled orders can improve customer satisfaction, and can strengthen the relationship with your clients.
With its ability to provide real-time visibility into inventory levels and locations, a WMS also helps your team make better decisions when it comes to replenishment and storage. Using a WMS, you can reduce inventory holding costs by optimizing inventory levels and locations.
When choosing a WMS software for your 3PL operation, there are several factors to consider. Here’s the top four you should think about when you are evaluating the many WMS platforms out there.
In the software world, there is not one size fits all. Some can be more dynamic than others, but every software has its pros and cons. When researching WMS platforms, consider the specific needs of your business, such as the size of your warehouse, how many warehouses you have, the types of products you handle (do you need a platform that can support expiration dates and/or lot tracking), and the volume of orders you process.
When it comes to software, there is more than one type, and WMS is no different. For WMS, there are three main software types:
The two key features that any WMS should have are features that can help harmonize your operations and make your life easier. Here are the two essential features to look for:
Inventory management is crucial to any business that deals with a physical product. It involves keeping track of stock levels, replenishing stock, and ensuring that products are put away in an organized way so that employees can easily pick the products as orders come in. A WMS with robust inventory management functionality ensures that businesses can reduce waste and avoid over- or under-stocking inventory.
Order fulfillment is the backbone of any e-commerce business. It involves receiving, processing and delivering orders to customers. For any online retailer, a successful order fulfillment process can also make or break a business. Quick and efficient fulfillment is needed to compete with the behemoth corporations out there. That is why the second most critical WMS functionality you should look for is order fulfillment.
As a 3PL, you know how important it is to connect with your client’s online marketplaces. Therefore, the integrations a WMS supports will be a huge factor of what application you choose to go with.
Tip: Before you decide on the WMS for your business, make sure that they support your integrations or have a plan to connect different platforms.
Implementing a WMS in your 3PL operations
Though implementing a WMS in your 3PL operation can bring many benefits, it can also present some challenges. Here are common challenges 3PLs face during WMS implementation and how you can overcome them.
Some warehouse employees might be resistant to a new system that changes how they currently do things. To overcome this challenge, try involving your employees in the implementation process and provide training and support to help them adjust to the new system.
When you think of integrating a WMS with the other systems in your tech stack, you might want to run as far and as fast as you can from new technology. A WMS worth its price tag will know this and will help you with setting up your integrations or (even better) make integrations seamless with one click.
Configuring a WMS to meet your specific needs and workflows can be challenging. A WMS vendor should provide an onboarding process where their team listens to how you currently work, what platforms you work with, and your current challenges. Then, using that information, create a new and better workflow that makes you and your team’s lives easier and sets the stage for growth and success.
Once a WMS has been implemented, it is important to receive training and support to ensure the system is used effectively. This includes onboarding, online resources, and ongoing technical support. All should alleviate the process of integrating a new software into your process. However, sometimes, they can create added frustrations. Here’s a look at some elements to look for when it comes to training and support:
Some onboarding costs can be around $600 and some onboarding costs can be in the thousands. This cost is in addition to the cost of the software and is sometimes not disclosed right away. Before you choose the best WMS for you, make sure to ask about the onboarding costs so you don’t experience sticker shock later down the line.
When evaluating the different WMS applications, make sure that the WMS you are considering has a knowledge base that you can go to if you encounter any questions.
Some WMS software companies have great support during the onboarding process but seriously declined after that. You should always be able to get help if needed, and support should not be you trying to get your problem across to a chatbot.
Tip: Know how you will be treated when you do need to reach out to support. Try calling the support line of the software you are looking into. If you get exceptional service with that test, you will know that you will be in good hands if you choose to move forward with that company. If the process is more frustrating than you could have imagined, well then you have a glimpse into your future if you decide to go with that software.
The time it takes to implement a WMS depends on the software company. Some implementations can take six to eight months, and some can be up and running in a couple of weeks.
Enterprise Resource Planning (ERP) and WMS provide tools for automating processes and workflows. Both can be used interchangeably, but they are not the same thing. Here’s how the two solutions differ:
How can a WMS reduce the cost of operations?
A WMS can reduce your warehouse operations cost by making it possible to process more orders without the need to hire additional staff.
A warehouse management system (WMS) can bring many benefits to a 3PL operation, including improved efficiency, increased productivity, enhanced accuracy, and better inventory management (to name a few).
Book a call with our team to see if Zenventory’s WMS is the right solution for you and your business.
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