There was a time when supply chain management in general and the warehouse specifically was the overlooked segment of a business. However, the entire world discovered the true value of a well-run supply chain during the pandemic-induced global shutdown of 2020. Even warehousing has the attention of the C-suite—but that doesn’t mean executives always understand the total worth a warehousing management system (WMS) can deliver. Sometimes you must present many valid reasons for investing in software.
One of the strongest arguments for adding a WMS is the simple fact that there’s a significant cross-industry labor shortage. For warehousing, competing for qualified labor can seem a nearly impossible task. Universally, warehouses are down anywhere from 10 to 30 people at any given moment.
This is especially true if your facility is near a big operation like Amazon, FedEx, UPS, etc. These massive companies have the deep pockets to lure employees away from smaller competitors. If you offer $15 for your floor employees, you can bet a large company will offer $18. When you are down in staffing, you are generally down in customer service, too, which comes at a high cost. This hits right at a company’s bottom line.
The only way to compete is to become more efficient and do more with less labor. This is one of the chief areas where a WMS shines and is a good way for C-level team members to view the prospect of investing in a system. Short-term WMS software investment costs will be far less than the cost of customers lost over the long term.
One way to present that argument is to reveal the corresponding numbers. Using throughput measures, you can demonstrate that you can get “X” amount of product out the door via a WMS-enhanced facility versus one that is short-staffed. The numbers add up quickly, often driving a return on investment (ROI) in as little as a month.
You can back up those numbers by demonstrating industry standards for WMS implementation or client testimonials if you’re working with a WMS provider.
Another area where WMS can prove its value to executives is inventory management, one of the software’s core competencies. If you are working off a paper system, you cannot quickly and efficiently manage inventory. This leads to slowdowns when trying to pick products and get them out the door—something no company can afford today. This is especially true when your staffing numbers are down, and you can’t simply “throw labor” at the problem.
Bottom line numbers one can reasonably expect from a WMS implementation equate to a 30% savings in labor, and perhaps many times more. Add integrated automation to your WMS, and you can expect an increase in productivity about five to seven times current levels. By taking these numbers and examples to the C-suite, the case for WMS is obvious and should be a somewhat easy sell.
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