Wednesday, July 16, 2008

WMS Vs. Warehouses

Experts and IT vendor decry lack of use of modern WMS in India. An advanced WMS can improve location management, reduce pick time and pick failure and provide "visibility" within warehouse.

Sounds great but why WMS is not a standard feature in modern India? The reason is that India does not have WAREHOUSES it has only GODOWNS.

A modern WMS requires modern warehousing practices on ground and also assumes certain scale of warehouses. Most warehouses in India are in 3000-10000 SQFT range with some exceeding 25000 SQFT. In such a place, it is not very difficult to find products manually. Also, being less productive in warehouse means adding a couple of more workers, not a terribly high barrier.

The need of the hour is VISIBILITY ACROSS WAREHOUSES. A company can not own ALL warehouses or put up their own ERP at all locations.

How to fill the gap?
The warehouse service providers can use basic but web-based WMS across warehouses. This way, all stock across locations can be captured and viewed online.This will allow decision makers to manage their supply chain better as now they know what is lying where.

For coming few years, the focus will be on visibility. As GST kicks in and local laws as well as real estate prices make it difficult to have warehouses within metros, larger warehouses will be built. These will then house multiple customers and feed into retail within a large city. Modern WMS will find utility in warehouses greater than 50,000 SQFT and more than 1000 SKUs.

Till that time, WMS vendors should focus on value adds such as WSP billing, expense control, inventory visibility and order management rather than automated, PDT driven WMS.