What's the point of having a Warehouse if you're not going to make the most out of it? Having a well-organized warehouse can help your business achieve its goals faster and easier.

A warehouse is a facility where goods are stored prior to distribution or sale. Typically, warehouses are used for the storage and distribution of finished goods. They are important because they allow businesses to reduce their inventory levels and mobilize products more quickly. A well-managed warehouse can also improve production techniques and speed up customer order processing.

In this article, we'll show you how to get the most out of your warehouse and turn it into an asset for your business. Let's take a look at the table of content before we dive in:

• What is Warehouse Management?
• What is Warehouse Management System?
• Significance of Warehouse Management
• Different Types of Warehouses
• Important Warehouse Management Processes
• ‌‌Fulfilment Strategies for Warehouse Management
• Optimising Packing Process
• Warehouse Management System Features
• Essential Components of Warehouse Management System
• ‌‌Benefits of 3PL Warehouse Management
• Warehouse Monitoring & Reporting
• Warehouse Performance Evaluation
• Warehouse Management Principles
• Key Benefits of a Warehouse Management System
• Important Tips to Arrange your Warehouse
• Choosing a Management System (WMS)
• Frequently Asked Questions (FAQs) Associated with Warehouse Management
• How Deskera Can Assist You?

Let's get Started!

What is Warehouse Management?

The recent rapid rise of the worldwide ecommerce business, which is predicted to top $29 trillion by 2023, has boosted the need for more warehouse space to meet growing customer needs. The growth of e-commerce is expected to result in a 1 billion square foot rise in demand for warehouse space in the United States by 2025.

Warehouse Management is the process of managing the storage and movement of goods and materials within a warehouse. It’s an important part of any supply chain operation and involves the coordination of receiving, storing, and shipping activities.

Warehouse management systems are used to optimize the warehouse’s overall efficiency and accuracy. They automate and streamline processes such as inventory control, order management, shipping and receiving, and more.

What is Warehouse Management System?

A warehouse management system (WMS) is a software program created to support and improve distribution center administration and warehouse functionality.

A warehouse management system (WMS) is used to monitor, manage, and optimize the storage and flow of products. It is used to identify the exact location of goods, manage stock levels, control inventory costs, and improve customer service. WMS also makes it possible to see the entire supply chain, as from manufacturer to the client.

Software for warehouse management provides both the tools to track daily operations and those to implement long-term, strategic improvements. When a picker or packer decides what to pick or pack next on the warehouse floor using the warehouse management system, different information is displayed in the system.

Different features may be added in a warehouse management system depending on the industries it serves (for instance, the requirements of a large brick and mortar shop chain and a direct-to-consumer ecommerce seller are very different).

Significance of Warehouse Management

Since warehouse management is in charge of receiving, storing, and distributing items, it plays a significant role in the supply chain process.

It is essential for companies to have an efficient warehouse management system in place in order to ensure proper inventory control, minimize operational costs, and maximize customer service.

A well-functioning warehouse management system allows companies to gain visibility into their inventory and warehouse operations, allowing them to make better informed decisions and increase their efficiency.

Furthermore, warehouse management systems can provide insights into customer needs, helping companies to better anticipate and meet their customer's needs.

Different Types of Warehouses

Following. we have discussed different types of warehouses. Let's take a look at each and every one of those:

1. Public Warehouses:

A public warehouse, which is maintained by a third-party provider (3PLs), which provides storage and inventory space for businesses. They can be leased by numerous enterprises at once and are occasionally open to the general public.

Many firms benefit from public warehouses since they lessen their management responsibilities for a warehouse. Public warehouses cover the cost of upkeep, safety, and personnel. Businesses who don't need constant inventory space can use a public warehouse for the little period that is necessary.

2. Bonded Warehouses:

Bonded warehouses are specialized warehouses in which imported goods are stored until duties or taxes are paid. Security precautions are in place, and the governments of the countries where these warehouses are located are in charge of them.

The goods stored in a bonded warehouse are considered to be held in trust for the payment of taxes or customs duties. Bonded warehouses are used for a variety of products, such as tobacco, alcohol, firearms, and other goods.

These are warehouses that have been approved and granted permission from customs authorities to store imported goods that are pending customs clearance.

3. Private Warehouses:

Private warehouses are owned and operated by a single company or individual to store their goods.

Typically, a large firm has its own warehouse where it keeps and ships its own goods. In contrast to a public warehouse, a private warehouse is not limited to retaining inventory items.

A private warehouse gives businesses the freedom to utilize the space anyway they see fit. Therefore, the entire product life cycle may occur in a single location, from brainstorming sessions through distribution center capabilities.

The ownership business is completely free to decide how to use the given resources and manage the warehouse. The cost of private storage is much higher, but the flexibility may be worth it.

4. Cross-Docking Facilities:

Cross-docking facilities are warehouses that are designed to facilitate the unloading of incoming goods and the loading of outgoing goods in a very short time frame. Goods are usually not stored in the facility but are instead quickly sorted and moved to their next destination.

Cross-docking facilities are used for both short-term storage and for long-term storage of goods. They are often used by companies to quickly move goods from one place to another, and to minimize the amount of time that goods spend in the warehouse.

Cross-docking facilities can be used for a variety of purposes, such as for short-term storage, for long-term storage, for pick-and-pack-ship operations, for order fulfillment, for product assembly, and for transportation consolidation.

5. Automated Warehouses:

Automated warehouses are warehouses that use automation technology to store, sort, retrieve, and pack goods. Automation technology includes robotic arms, automated storage and retrieval systems, goods-to-person robots, conveyor systems, automated guided vehicles, and barcode scanners.

Automated warehouses are one type of warehouse that uses automation to reduce costs, increase output, and improve customer service.

Automated warehouses have been used in many industries such as retail, e-commerce, manufacturing, and logistics. They can also be used for inventory management, order picking, and delivery. Businesses are increasingly turning to automated warehouses as a means of reducing costs and boosting productivity.

These are warehouses that use automation and robotics to store and manage goods, reducing manual labor and eliminating the need for manual sorting and picking.

6. Contract Warehouse:

Similar to a public warehouse, a contract warehouse is likewise controlled by a third-party business that provides inventory space for the duration of a contract, as negotiated. Contract warehouses differ from other types of storage since they are exclusively used by one business.

All the advantages of a private warehouse are available when renting a contract warehouse without actually owning the building. The warehouse owner signs a contract with a single company and assumes the majority of the management duties. Companies can hire warehouse employees on a contract basis or use their own internal resources.

7. Smart Warehouse:

Smart warehouses use automation to streamline activities in the warehouse. As the production industry is subjected to more technological advancements, we see robots and complex machinery entering warehouses. In some warehouses, even machines have been used to interpret orders, get items from stock, and package things for shipping.

Smart warehouses will be advantageous to businesses who can afford to invest in inventory tracking technology and seek to reduce the risk of human error. For a smart warehouse, installation, maintenance, and employee training are pricey.

8. Climate-Controlled Warehouse

Businesses should employ climate-controlled facilities when selling products that are sensitive to temperature changes.

This includes items like wine that must be maintained at a specific temperature to stay fresh as well as perishables like frozen foods. It may also comprise more basic materials like wood, which can degrade in extremely humid environments.

Climate-controlled warehousing makes an effort to create an environment that encourages the growth of commodities using dehumidifiers, heaters, and other equipment.

Important Warehouse Management Processes

One aspect of supply chain management is warehouse management. All aspects of fulfilling retail orders, including storage, inventory control, shipping, and distribution, are affected.

You can see what's happening across multiple warehouse processes, such as the reception of inventory, the packaging of orders, the labelling of shipments, and any other movement of products, in real-time using an all-in-one solution.

Inventory Tracking

Inventory tracking is the process of monitoring the quantity, location, and state of the stock held in a warehouse.

This is done to ensure that the correct amount of inventory is available when it is needed and that it is stored in the right place.

Inventory tracking also helps to identify any discrepancies between the amount of inventory in the warehouse and the amount expected. This helps to prevent losses due to theft, damage, or misplacement of items.

Inventory tracking typically involves the use of barcodes or RFID tags to identify each item in the warehouse. This information is then linked to a database that stores information about the item, such as its location, quantity, and condition. Reports that give a summary of the inventory in the warehouse can then be produced using the data recorded in the database.

Inventory tracking can also be used to automate the process of ordering, receiving, and inventorying new items.

As a result, the procedure is more effective, and the time needed to operate the warehouse is decreased. It also helps to reduce the risk of errors and losses due to inaccurate data entry.

Picking and Packing

Picking and packing are two of the most important functions within a warehouse. Picking is the process of retrieving items from shelves, bins and other storage locations in order to fulfill customer orders. Packing is the process of preparing those items for shipment.

A system for both picking and packaging must be in place for a warehouse to be managed efficiently. The personnel should be able to easily follow the system's regulations and guidelines when carrying out these duties.

A system for monitoring orders, inventory, and other goods should be included of it as well. Other elements of the system might include an automated system for order fulfillment, barcode scanning, and automated packing systems.

Having a well-designed picking and packing system in place can help ensure that orders are fulfilled quickly and accurately, and that inventory is well-managed. This may contribute to greater customer satisfaction and, ultimately, more sales. Furthermore, it can help to reduce the cost of operations by streamlining the warehouse management process.

Receiving and Stowing

Receiving and stowing are essential to warehouse management for the smooth operation of the facility. Receiving involves the physical process of unloading, sorting, and documenting the arrival of goods, while stowing involves the process of organizing and placing goods in the warehouse.‌‌

Receiving is the first step in warehouse management and involves unloading goods from trucks or other conveyances, inspecting and verifying the goods, and documenting the arrival. The process may also include separating the goods into batches and labeling them according to the inventory system.‌‌

Stowing is the process of organizing and placing goods within the warehouse. It involves finding an appropriate storage location for the goods, organizing them in an efficient manner, and labeling them according to the inventory system. The goal of stowing is to ensure easy access to the goods when needed.‌‌

The two processes of receiving and stowing are important components of warehouse management. They help to ensure efficient operations by allowing goods to be quickly and accurately stored and retrieved. By properly organizing and labeling goods, warehouse staff can quickly locate and access the goods when needed.‌‌

Shipping‌‌

Shipping in warehouse management is the process of packaging, labeling, and sending products from the warehouse to a customer or another warehouse. It involves managing inventory, coordinating with carriers, tracking shipments, and ensuring that deliveries arrive on time and in good condition. ‌‌

To make sure that all orders are processed quickly and accurately, the warehouse manager is in charge. They must ensure that the right products are sent and that the shipments are properly tracked. Additionally, the warehouse manager must ensure that the necessary paperwork is completed and that all necessary fees are paid.‌‌

Shipping firms like DHL, USPS, FedEx, and UPS will pick up orders from the warehouse and deliver items to their next destination in accordance with the delivery options and shipping options you provide to clients.‌‌

Your warehouse management system should be able to transmit tracking information back to your store as soon as an order ships so that your consumers can check on the status of their purchases.‌‌

Reporting

The operational and inventory data for the entire warehouse should be available right out of the box with a warehouse management system. Order accuracy (total mis picks, mispacks, etc.), total orders fulfilled each hour to gauge staff productivity, orders dispatched on schedule, and much more may be provided.‌‌

There is also information on how people are operating, like inventory estimates to understand labor management and staffing needs. You can quickly determine which employees have completed safety training, have licenses or other credentials to operate certain equipment, and have complied with all other legal requirements necessary to operate a secure warehouse by using a warehouse management tracking system.‌‌

Warehouse management reports can provide valuable insights into operations, such as inventory levels, stock turns, product flow and employee performance. Reports can assist in identifying possibilities to enhance procedures, boost effectiveness, save costs, and enhance customer service.‌‌

Common Warehouse Management Reports include:‌‌

1. Inventory Reports: These reports provide an overview of inventory levels, such as quantity on hand, reorder points, and safety stock levels.‌‌

2. Stock Movement Reports: These reports provide visibility into how product is moving in and out of the warehouse, including details on receiving, order fulfillment, and shipping.‌‌

3. Cycle Count Reports: These reports provide insight into the accuracy of inventory levels, including the number of cycle counts performed and the accuracy of each count.‌‌

‌‌Fulfilment Strategies for Warehouse Management

By selecting fulfilment strategies that are appropriate for the size of the company as well as the volume and diversity of orders it receives, the company may send products more rapidly, decrease waste, and boost customer satisfaction.

Using choosing methods that are suitable for the types of orders you receive will help you maintain the most effective workflow.

Take into account the following when picking, packing, shipping, and your distribution strategy in general:

Optimal Picking System

An optimal picking system is a type of warehouse management system that is designed to optimize the process of picking and packaging items for shipment. This system is typically used in warehouses and distribution centers to ensure that orders are picked, packed, and shipped in the most efficient and cost-effective manner possible.

The system can include automated picking systems, such as robotic pickers and automated conveyor belts, as well as manual picking systems that involve manual selection of items by workers. The system also includes software that tracks the inventory, orders, and shipment details to ensure accuracy and efficiency.

Single Order

This is the basic picking method, which is typically only used by beginners. Simply said, a picker will complete one order before going on to the next.

This would be best for small retailers who haven't yet expanded to a size where they can gain from more advanced selecting methods.

Furthermore, you must avoid using if you ship more than 20 client orders each day (or plan to in the near future).

Batch Picking

Batch picking is a warehouse fulfillment strategy that maximizes efficiency by grouping like items together into “batches” for order fulfillment.

This process allows for the combination of several orders into a single picking trip, reducing the number of times a picker needs to walk the warehouse aisles in order to fulfill orders. This can save time and increase accuracy, as well as reduce labor costs.

Batch picking is an efficient way to manage inventory in a warehouse, as it reduces the amount of time that is spent picking and packing orders.

This would be best for orders that include a lot of just one or a few products.

Furthermore, you must avoid it if your orders frequently include a lot of items (or are aiming for this in the near future).

Learn more about batch tracking of inventory here.

Zone Picking

Zone picking is a warehouse management fulfilment strategy that involves dividing warehouse space into distinct zones, each of which is dedicated to storing a specific type of product.

This strategy is designed to improve the efficiency and accuracy of order fulfilment by allowing workers to quickly identify and access products in the right zone. It also helps warehouses keep inventory organized and easy to access, reducing the time it takes to pick and pack orders.

Zone picking can be combined with other strategies, such as batch picking and wave picking, to further optimize order fulfilment.

This would be best for stores that regularly mail orders with a large number of items.

Furthermore, if you routinely send orders with just one or a few things or if you have few pickers, stay away from it.

Wave Picking

Wave picking is a type of order fulfillment strategy used in warehouse management. It is a method of picking orders where a group of orders are picked together, or in a “wave”, rather than picking each order individually.

This technique is used to increase efficiency and accuracy in the order fulfillment process by reducing the time spent on order picking.

Wave picking can be used in combination with other order fulfillment strategies, such as zone picking and batch picking. It is commonly used in companies with high-volume order fulfillment needs.

This would be best for retailers who frequently send orders including a large number of items but need a rapid response.

Furthermore, you must avoid if your pickers are few, you frequently send tiny or individual order packages, or cost is more essential to you than delivery speed.

Check the following table where we have summarized everything at one place. Check below:

Optimizing Packing Process

There is more to packing than rapidly putting items into a box.

It's a time to firmly state that you're making the most effective deliveries of the appropriate products to the right clients.

Below are a few concepts to think about:

Packaging Materials

Products are protected during shipping and handling by packaging materials. Common packaging materials include cardboard boxes, plastic bags, bubble wrap, foam, and shrink wrap. These materials are typically used to bundle items together and keep them safe during transit.

Warehouse managers should consider the type of products they are shipping and the best packaging materials to use in order to ensure the safety of their shipments.

Some of the most typical ones are listed below:

Box Size

The size of a box in warehouse management depends on the size and weight of the items that need to be stored inside the box. In general, the box should be larger and heavier products heavier.

To handle a variety of item sizes and weights, boxes are available in a range of sizes, from small to large.

Some warehouses may also use specialized boxes, such as pallets, to store large or heavy items.

Shipping your Orders

When it comes to shipping your orders, it is important to ensure that you are using a reliable and reputable shipping service.

You should also take into account the cost of shipping and the estimated delivery date when you are making your shipping decisions.

Additionally, you should be sure to accurately package and label your orders so that they arrive safely and on time. Finally, you should always keep records of all your shipping transactions to ensure that you are able to track the progress of your orders.

Simple warehouse management procedures comprise the following steps:

• Weigh the Package
• Make the required shipping label (and invoice, if not already done so)
• Print Labels & Invoices
• On the appropriate order management system or sales channel, mark the order as "Shipped."
• Send the customer an email to confirm delivery and provide tracking information (a good order management system will do this for you automatically)

Warehouse Management System Features

Following, we've discussed some important features of warehouse management system. Let's learn:

Inventory Management

Inventory management is the practice of monitoring and controlling a company's inventory. It involves overseeing the receipt, storage, retrieval, and distribution of items and materials.

A company can raise earnings, decrease costs, and enhance customer service with the use of inventory management. It can also help to prevent stock-outs and reduce inventory carrying costs.

Proper inventory management involves tracking all inventory items, understanding inventory levels, and maintaining accurate records. It also entails setting up a productive system for placing orders, receiving deliveries, and storing inventories.

Risk Management

The process of detecting, assessing, monitoring, controlling, and minimizing risks that pertain to a business or system is known as risk management.

It is an ongoing process that involves identifying and assessing risks, implementing strategies to mitigate those risks, and monitoring and responding to any changes in the risk environment.

Risk management is a critical component of business success as it helps to identify, prevent, and mitigate potential threats that could negatively impact an organization.

Proper risk management can also help organizations better understand and manage their business operations, enabling them to make better decisions and maximize their profits.

Order Management

Order management is the process of overseeing customer orders from the moment they are placed until they are fulfilled. This includes order processing, order tracking, returns management, and customer service. It is a critical function of any business that sells products and services.

Order management is important for businesses because it helps ensure that customers get what they want when they want it. It also helps businesses optimize their supply chain and inventory management processes.

Dock Management

Dock management is the coordination of activities related to the handling of goods at a dock. This includes the loading, unloading, and storage of goods, as well as the movement of vehicles and personnel.

Dock management is typically the responsibility of a dock supervisor or manager. The goal of dock management is to ensure the efficient and safe handling of goods, as well as the protection of workers and property.

Labor Management

Labor management is the process of managing the relationship between employers