It wasn’t that long ago that simply having a sophisticated warehouse management system (WMS) was a major selling point for third-party logistics (3PL) providers. Over time, however, this technology has become commonplace, with just about all 3PLs having their own WMS bells and whistles to advertise.
But, while having a full-featured WMS may no longer be a differentiator for 3PLs, the way a 3PL uses the system certainly can be.
Why are 3PL WMS systems important?
A modern warehousing operation involves a wide range of operations, from inventory management and order tracking to metrics reporting and labor management. Your 3PL’s WMS system acts as the central hub of all these operational spokes – one system managing all your many functions in real time.
Such sophistication comes at a price, of course. A robust WMS system can cost well into the six figures. But it’s not an investment you need to make yourself, as most 3PLs have already WMS systems in place. By outsourcing warehousing services to a 3PL provider, you can simply connect your operation to its WMS while sharing the costs with the provider and its other customers.
In this article, we’ll examine 7 key benefits that you should look for in your 3PL’s WMS.
7 benefits your 3PL’s WMS should provide
- Real-time visibility using RF technology. Your 3PL’s WMS can track the movement of your products in real time using RF (radio frequency) technology. This technology enables products to be scanned by associates using hand-held devices which feed information back to the WMS. For inventory, you can see when your products are received at the warehouse and where they are stored. When orders come into the system, you can see their effect on inventory and track their progress as they head out for distribution. Such real-time visibility allows you to stay nimble and allocate your products to meet demand, while also enabling you to monitor order statuses against customer expectations.
- Omni-channel capabilities. Your 3PL’s WMS system should manage inventory for multi-channel distribution in real time. With such a system, you no longer to need contend with multiple, sometimes duplicate, instances of inventory which can throw your weeks of supply and cycle counting off track. This then allows you to lower your warehouse footprint (and costs) as you no longer need to account for inventory surprises in your stock volumes.
- EDI connectivity. Though it may surprise you, there are still 3PLs using largely manual methods for order entry and other customer communications. In addition to being labor intensive and time consuming, such manual methods are also prone to inaccuracies. Your 3PL should instead offer fully electronic communications between its systems and yours via EDI (electronic data interchange). EDI allows for the automation of a wide range of communications including order placements, receipts, label printing, and invoicing – making your operations more efficient and more accurate in the process. Your 3PL should be able to partner with you to build, maintain, and expand that connectivity as needed, in days and weeks – not months.
- Vendor compliance. Your provider’s WMS system should also be an ally in your efforts to adhere to retailer requirements and avoid chargebacks. Simply put, just about every aspect of your warehousing operations can be hard-coded to comply with these requirements. This includes generation of labels and pack slips, order tracking, and real-time reporting of the metrics important to your retail partners.
- Customization of KPI tracking. Speaking of metrics important to retailers, your 3PL’s WMS can provide real-time access to the information and KPIs most important to your business. That is to say, it can be customized to meet your unique requirements. Because, even though you’re sharing a WMS when you work with a 3PL, many WMS systems allow for seemingly endless customization of inventory, order, labor, and productivity metrics across multiple clients. Your 3PL should be asking you two straightforward questions: what do you want to see? And, how do you want to see it? It’s then up to your 3PL to make it happen.
- Value-added services. WMS customization doesn’t just apply to the information you want to see – it can apply to the services your 3PL offers as well. As an example, at Weber Logistics we often create bills of materials (BOMs) for our customers. This allows the customer to change a product’s configuration (e.g., sell components of a product in addition to the fully configured version) for resale or to present it to the market in a different way. Using our WMS, we can create inventory of both the individual components and the finished product, and manage and track each as they enter the marketplace.
- Opportunities for improvement. Technology is never stagnant, and this is especially true with WMS systems and other warehouse technology. For one, WMS systems should be updated regularly. Your 3PL should have the IT staff to stay on top of these updates. Additionally, there is always emerging technology within the logistics industry – from automation and robotic technology to drone capabilities. Your 3PL should be exploring ways to embrace these and other technologies that can enhance its operations.
Get to know your 3PL – and its WMS
Before working with a 3PL, it is vital that you get to know the company, its people and its capabilities. This involves everything from meeting with management to touring facilities and speaking to the people actually performing the work.
It also involves getting to know the provider’s logistics technology systems and what they can do for you. All WMS systems aren’t created equal, and all 3PLs don’t use them in the same manner. Some 3PLs have more of a “buy it and let it run” approach to this technology, while other companies have a much more hands-on approach, customizing it to address ongoing customer requests and enhancements.
At Weber Logistics, our WMS capabilities are supported by teams of in-house specialists that stay on top of systems and vendor compliance updates, while working with each Weber customer closely to match capabilities to ever-changing business needs. To learn more about how this approach may benefit your operation, contact Weber today.