What Is Warehouse Management; Definition & Useful Tools
Warehouse management is an important issue for all businesses that make wholesale sales from the warehouse or store products for retail sales, especially the production companies. Considering the place of storage expenses among the operating expenses, the contribution of the correct management of this activity to the enterprises is obvious.
A warehouse management system means that operations such as product entry, product output, counting, and shipment that take place in a warehouse are managed together in a controlled manner and kept in order. In the classical business and marketing periods, this process was done manually with notebooks and paper in order to manage and keep the warehouses under control.
However, this situation has become impossible because today's enterprises have reached large sizes and have made great progress in terms of product variety compared to that period. Today, software developed to make the warehouse management process easier and faster is preferred. These management tools allow us to record every transaction made instantly. This makes it easier to keep records of the products available in the warehouse, integrate new incoming goods into these numbers, and drop out the goods from the system.
What Is The Difference Between Warehouse Management and Inventory Management?
Warehouse management and inventory management concepts are sometimes mixed with each other and used interchangeably. In fact, these two concepts are in relation to each other, from subordinate to superior. Stock management is a sub-element of warehouse management. The purpose of stock management is to count only the amount of products in the warehouse and keep them under control. On the contrary, warehouse management includes the selection of the location of the warehouse, planning the shipments, and the smooth regulation of the connection between the buyer and seller. Therefore, it is possible to say that warehouse management is more comprehensive.
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Why Do We Need Warehouse Management System?
There are many different factors underlying the need for warehouse management of businesses. This method has a wide scope that cannot be explained by the need to know only the amount of product. Some of the situations that require warehouse management can be listed as follows:
- Increasing Logistics Performance: When businesses receive an order, the short delivery time is one of the essential aspects in terms of keeping the order in the market. Fast delivery is possible with the availability of the requested product at all times. It is important for successful planning both because it provides and in cases where the shipment is required.
- Ensuring Continuity in Production: It is not desirable to have large quantities of products in warehouses in order to keep the cost of storage low. With successful management, keeping the stocks at the most efficient level and providing continuous flow instead of mass product stock brings the advantage of continuity in production.
- Balancing Production and Consumption: Balancing production and consumption for businesses is an important issue in terms of eliminating the uncertainties and fluctuations in the market. Thanks to the successful warehouse management, it is possible to produce an amount that will fully meet the consumption and achieve this balance. In this case, the product is kept at the level called safety stock in the warehouse, and production is always transferred to meet consumption.
- Reducing Transportation Costs: It continues to be discussed today that it is more advantageous and cost-effective to make small shipments in small quantities than bulk shipments at once. However, according to the general acceptance, making small and a high number of shipments leads to a more profitable position. The necessity of warehouse management in terms of planning and execution is obvious.
What Are The Functions Of Warehouse Management System?
The warehouse management system provides many different functions for businesses. One of these functions is to use the workforce more efficiently. It is possible to focus on different subjects with the workforce that needs to focus on this subject since it allows the warehouse management process to be carried out easily. In addition, thanks to this system, it is ensured that customer orders are fulfilled more accurately and quickly. Another function of this system is to increase the integration between units. Increasing profitability by reducing operating costs is among the important issues that can be mentioned in this direction. As another function of these systems, as a result of the integration of machine and manpower, it is its contribution to making decisions faster.
What Are The Best Warehouse Management Systems?
It is essential to be careful in choosing the system in order to perform the warehouse management process successfully. Choosing the right system, especially in businesses with high storage volumes, means making things extremely easy. Care should be taken to ensure that a good warehouse management system is smart and uses modern technology. In addition, the high level of integration of good management software is another matter to be emphasized.
Systems that allow performing tasks such as transportation, goods acceptance, goods exit, and goods counting from a single point regarding storage operations have an extremely large function in terms of making things easier. In addition to these qualities, another feature that should be in a good system is that its interface is simple and easy to use. Systems that create confusion for users can often lead to mistakes and doubt when making decisions. Today, there are many management software that fulfills these functions. It is necessary to be extremely careful while choosing in this regard and to choose the system that best suits the objectives of the business.