Warehouse management systems for more efficient distribution centers

Do your company’s distribution center processes allow different packaging units (pallets, cases, as piece picks) to be ordered and is the volume (number of orders, order lines, pick lines) relatively high as well? If so, a warehouse management system (WMS) could be the right solution for you, but it is wise to examine the business case carefully first. A WMS can easily deliver up to 25-30% efficiency improvements while also raising the quality (by reducing picking errors, improving availability of stock, shortening lead times, assisting workload planning, etc). Providing the business case proves positive, a WMS can help your logistics employees to handle all manner of distribution center processes better and more efficiently (in particular activities relating to goods in and dispatch, inventory management, cycle counting and VAL), thus optimizing the way your company adds value and saves costs. A WMS is primarily focused on what happens inside a DC, but there are also versions available that can manage stocks beyond the four walls of the distribution center too (such as in the case of ships and ports). In brief, successful warehousing can result in a significant reduction of costs and an increase in service levels. However, a great many WMS projects fail to achieve the original objectives due to inadequate preparation.

WMS advice
As a consulting firm, Groenewout does not supply software. However, we can offer you independent advice on warehousing and logistics IT packages such as WMS, WCS, OMS and shipping systems. We always begin by evaluating your business processes and quantifying the volumes (= baseline measurement) as a basis for devising new concepts and their underlying business cases. Relating to the topic of warehousing, we can provide advice on aspects such as:

  • Feasibility studies (both greenfield and brownfield)
  • Process design and redesign
  • Layout design for factories, warehouses and distribution centers
  • Support in selecting and contracting a suitable WMS package
  • Optimization of inventory management
  • Modeling
  • Support and supervision of tendering
  • Drawing up of IT specifications (both functional and technical preliminary designs)

Just as with all of our advice, you receive a complete overview of pragmatic solutions that can be implemented directly. Moreover, we frequently support the practical implementation of our recommendations.

Warehousing for Forever Direct
In order to give you a sense of our consultancy’s approach relating to warehousing, we are pleased to outline the project we completed for our client Forever Direct Europe. Forever Direct Europe is part of Forever Living Products, an American manufacturer of beverages and health and beauty products that are sold globally through 9.5 million distributors in 147 different countries. Forever Direct Europe is responsible for distributing the products in Europe. Initially the company outsourced the activities through a European distribution center, but two years ago, Forever Direct decided to handle its own warehousing.

On behalf of Forever Direct, Groenewout first carried out a feasibility study to explore whether insourcing the order fulfillment activities would save costs and be service neutral. Our advice resulted in a new European distribution center (EDC) serving 11 countries. We also designed the logistics concept of the EDC, which comprises 17,000 m2 of floor space, including 1,000 m2 for offices. Half of the EDC is fitted with pallet racking for bulk stock. The other half has been designed as an order fulfillment center for finely meshed distribution. We also supported Forever Direct with the construction and layout. In addition to support for tendering and contracting, Forever Direct then also asked us to supervise the WMS implementation. First and foremost, the WMS had to optimally manage the stocks in the distribution center (customs goods). In other words, it had to take account of customs requirements, despite the fact that the CMS (customs management system) was not linked to the WMS. The WMS had to be connected to three other IT systems: the ERP system, an automation-technology supplier’s WCS for the PTL (pick to light) system, and a shipping module in order to be able to print out the right labels per carrier, among other things. We were able to support the client from the functional and technical design right through to (integration) testing.

More warehousing/ WMS references:

  1. Forever Direct
  2. Eimskip
  3. Amgen
  4. AkzoNobel

Would you like to know more about warehousing, and WMS in particular? If so, please feel free to contact our expert:

Mo Lasgaa

Mo Lasgaa
Managing Consultant
E:  lasgaa@groenewout.com
T: +31 6 5021 1929

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