Boosting Warehouse Efficiency during Peak Seasons: Measuring the Financial Gain
Rewritten Article:
Let's cut to the chase: Savvy supply chain leaders know that investing in tech is key, but choosing the right logistics technology solutions can be a tricky business given the market's abundance of options. If you're drafting a business proposal for software that can supercharge your fulfillment operations, it's crucial to grasp the return on investment (ROI) for your chosen solutions.
According to a whopping 92% of retail supply chain leaders, modern warehouse management systems (WMS) and order management systems (OMS) are the solutions to fulfillment headaches. Out of this 92%, approximately 70% are busy implementing these platforms for peak season 2023. These insights come from a survey conducted by Deposco and Supply Chain Dive's studioID, involving more than 150 retail and supply chain executives discussing their preparations and predictions for the upcoming peak season.
With warehouse management pegged as a top concern for nearly half (48%) of respondents, investments in WMS and OMS platforms are making waves this year. The quest for a smooth-running warehouse has never been more urgent.
To invest, or not to invest? That's the question.
First things first: A scant 22% of retail leaders recognize the benefits of a WMS or OMS, but are not planning to make investments in 2023. It's not difficult to imagine the various reasons why a supply chain whiz might see the need for certain software and still choose not to invest. However, the most probable culprit is often the challenge of creating a compelling cost-benefit analysis to win over internal stakeholders.
Michael Johnson, the vice president of business consulting at Deposco (a provider of omnichannel fulfillment technology solutions), helps supply chain management leaders understand technology implementation and the ins and outs of warehouse and order management systems daily. Johnson sees many leaders struggle to present a watertight business case, their efforts sometimes less than accurate.
If you're planning to make a case for a WMS or OMS, it's non-negotiable to understand both the short-term and long-term ROI. According to Johnson, a swift ROI is within reach, especially with a solution that can be implemented quickly without causing disruptions to your current operations. "Not only will you witness that rapid ROI," he said, "but you'll be prepared to scale and grow seamlessly after the initial implementation."
To build a persuasive ROI story and invest in solutions that will serve as a foundation for success, look for a WMS or OMS that:
- Harmonizes effortlessly with ERP, ecommerce platforms, and sales channels, reducing implementation friction.
- Offers a speedy deployment process and hassle-free onboarding.
- Ensures real-time inventory visibility across all channels, increasing order throughput and accuracy.
- Scales swiftly to accommodate growth with minimal IT resources or custom projects.
- Provides elastic fulfillment capacity, so you can adjust to unpredictable peak loads.
- Offers long-term benefits for not only this peak season but future ones as well.
"When executed properly, these solutions deliver not only strong ROI but do so rapidly," Johnson emphasized. "Modern businesses are geared towards quickly recognizing value, often within just two to three months."
To steer clear of concerns surrounding system integration (an area of concern for 43% of retail leaders for the upcoming peak season), make sure the platform you choose plays nicely with the supply chain systems and automation technologies you currently use or plan to adopt. WMS or OMS integration with other platforms should be a breeze, requiring minimal consulting or custom coding whenever there's a need for an upgrade.
Your technology partner should be an extension of your business
While platform features and benefits are essential, remember that the partner behind the software is just as crucial as the solution itself. To smoothly roll out a WMS or OMS, look for a provider and partner that:
- Demonstrates a deep understanding of your operation and the challenges you need to overcome.
- Can identify and eliminate implementation barriers, ensuring a rapid and valuable return on investment.
- Offers the means to shift heavy expenditures from your people to your processes, improving productivity, employee experience, and worker retention.
- Builds flexible, predictable growth plans that help your business scale over time.
Achieving both short-term and long-term ROI
WMS and OMS platforms lay the groundwork for inventory, operations, and other technology systems. Putting a system like this in place is the initial step to deploying automation, which more than half (55%) of respondents are prioritizing this year.
To hit the ground running and see rapid ROI, Johnson advises starting with a small project to secure success from the outset instead of launching all new systems, technologies, and processes at once. "Go slow, go fast, go far" is Johnson's mantra: Start, let your team and processes adjust, and continue to integrate your WMS or OMS into your workflow smoothly and steadily. Above all, ensure you choose a solution that allows for easy addition of new features and functionalities as you grow.
Where do you stand on your warehouse solutions journey? How do your preparations for peak season stack up against what other retail leaders are doing? Grab the full research report to learn more about peak season priorities, concerns, and challenges in 2023.
- In the retail industry, investing in technology is considered essential, and choosing the right logistics technology solutions can be challenging due to the abundant options.
- A survey conducted by Deposco and Supply Chain Dive's studioID revealed that over 90% of retail supply chain leaders view modern warehouse management systems (WMS) and order management systems (OMS) as solutions to fulfillment challenges.
- The need for a smooth-running warehouse is urgent, with over 48% of retail leaders citing warehouse management as a top concern.
- Despite recognizing the benefits, only 78% of retail leaders are planning to invest in WMS or OMS platforms in 2023, with the main challenge being creating a convincing cost-benefit analysis.
- Michael Johnson, VP of business consulting at Deposco, emphasizes the importance of understanding the short-term and long-term ROI when making a case for a WMS or OMS.
- To build a persuasive ROI story, Johnson suggests looking for a WMS or OMS that harmonizes with ERP, ecommerce platforms, and sales channels, offers swift deployment, real-time inventory visibility, scalability, elastic fulfillment capacity, and benefits for future peaks besides the immediate one.
- To ensure minimal concerns about system integration, choose a platform that integrates smoothly with the existing supply chain systems and automation technologies.
- When choosing a provider for a WMS or OMS, look for one that demonstrates a deep understanding of your operation, eliminates implementation barriers, shifts heavy expenditures from people to processes, and builds predictable growth plans.
- WMS and OMS platforms serve as the foundation for deploying automation, and to see rapid ROI, Johnson advises starting with a small project, letting the team and processes adjust, and gradually integrating the system into the workflow, all while ensuring easy addition of new features and functionalities as the business grows.
