What You Need to Know About Warehouse Management Systems

By Kevin Reid, Don James

Every manufacturing business today is under pressure to reduce costs, increase profits, and meet ever-increasing service requirements from customers. In coatings companies cost reduction programs have focused primarily on reducing costs in manufacturing and administration. The challenge is to reduce costs while improving service to customers.

An area that most coatings companies often overlook as an opportunity for reducing costs and improving customer service is the warehouse. A Council of Logistics Management study showed that for manufacturing companies, warehouse and distribution costs can range from 7–15% of sales. These numbers are representative of a relatively simple warehouse and distribution network. As network complexity increases, these costs will increase as a percentage of sales.

While management is demanding reduced costs, customers are requiring shrinking order cycle times, faster response to order changes, and the ability to handle customer specific shipping and packaging requirements. To meet the ever-increasing service requirements of customers and reduce warehouse costs, more and more companies are turning to warehouse management systems.