Peak season. Doesn’t it always seem right around the corner? Just when you get through the season, you can take a quick break, but there’s no rest for the weary. Your thoughts jump to whether or not your legacy WMS (warehouse management system) will get you through the next round.
Regret sets in about not entertaining the idea of a more scalable, best-of-breed WMS and order management system created for what you do.
Here’s the rub.
If you’re like the 48% of our peak season survey respondents, you have a “Continuous Peak Season”. There’s no time to regroup and recharge. You get back to it.
Even more, you know you need to make investments in new tools to improve the efficiency and profitability of your peak. But you think, “We’ve gotten through this before just fine.”
That’s an above-line problem masking below-line impacts that lead to disaster once you’ve exceeded your operational capacity.
Shockingly, 79% of supply chains believe a WMS or OMS system will improve profitability in peak season, but only 36% invested in one according to the survey.
Let’s take a look at some of the common reasons why organizations don’t invest in a WMS or OMS system – even when they KNOW it will improve their performance. Then, we’ll share some valuable buy-in tools you can use when making the case for an investment!
Excuse 1: Our peak season is short – We can suffer for a few weeks
With nearly half of the survey respondents experiencing a year-round peak season, there’s no time for “catch-up”.
It’s a clear data point illustrating the rapid change in both supply chain volume and consumer expectations, combined with new twists and turns such as the rise of Direct-to-Consumer ecommerce.
Even more, if you have a short peak season, you don’t have time for delays. When time is precious, breakdowns and delays are enormous risks. If you don’t have technology solutions for warehouse management or you have an outdated system, things are risky.
For example, if your system goes down on December 26th, how easily will you be able to find temporary staff to come in and manage your orders by hand so they still ship on time? What’s the cost of that?
How much can you and your team actually take?
Excuse #2: We don’t need to scale
You are happy with the way the business is going today. Things can quickly change! Keeping your business competitive is tricky if you aren’t ready for change.
“Retailers that don’t see the value of omnichannel now will eventually experience growing pains as the evolution picks up speed. When their customers pull them toward it, they’ll have to respond. If you’ve got a brand that a customer wants to buy, then they’ll buy it where and how they want to buy it. And you better be present and ready to sell it.”
-Will Lovatt, general manager and vice president at Deposco Europe
You have an ERP to manage inventory accounting. But ERPs aren’t designed to be the backbone of omnichannel fulfillment.
If your path to growth points toward setting up a digital storefront – how reliably can your ERP manage your inventory so you know exactly what’s available to sell online?
Even more, if demand spikes or consumer preferences change on a dime, can your current system optimize your operations in response? Or is that an 18-month-long IT project you’ll need to hire out?
Look for a balance between rapid standup and a solution that can scale up as you need. A lengthy implementation can span across two peak seasons. By the time it’s in place, your needs will probably have changed. The right solution should be able to do both.
Excuse #3: A new WMS system costs too much
Technology expenditures are not cheap. But, it’s worth considering how much it will cost if you don’t make a change. What is the Cost of Inaction? Operational inefficiency can break even the most successful business in ways you may not consider.
Brand damage is one example. Your loyal customers will begin to wonder what is going on and move to other providers when service declines. Or when you’re forced to increase prices to cover your increasing shipping costs.
System downtime is another. How long can your customers wait for your solution provider to fix the problem? Outdated WMS systems have outdated support. You can’t renegotiate when things go south.
Excuse #4: It’s easier (and cheaper) to hire more people
Really? Gone are the days when a company could just throw bodies at a problem to solve it.
Today, even if you can find the people, you have to train them. It will take time to get them up to speed if you don’t have an established process.
Training time isn’t productive working time. Nearly 50% of the survey respondents stated they worried about labor shortage, turnover, and retention.
A flexible WMS system makes the people you have more productive. It makes your people productive and happy. The onboarding process becomes smooth, efficient, and quick to learn.
Even more, efficient workflows and automations free teams to work on higher-value activities.
Excuse #5: Our customers are happy enough
Oh, the fickle nature of customers! One day you’re hot, and one day you’re not. It takes a lot of work to attract new customers and keep them.
You’ve heard of the 80/20 rule? Eighty percent of your business comes from the 20 percent of your customers – your most loyal and consistent buyers. It’s far easier to keep the ones you have and deliver the services they want.
A single order mix-up – resolved quickly – is easy to forgive. Especially if you have the ability to communicate that mix-up and fix it right away.
People want predictability and consistency. Continual stockouts, delayed shipments, and inaccurate orders chip away at your customer’s investment in your brand. Once that happens, they will look elsewhere.
On the flip side, the right WMS system improves order accuracy and fulfillment times on a consistent basis for your customers. When something is at risk, the system’s analytics and reporting will alert you – significantly mitigating risk every day of the year.
Excuse #6: I’ve been in this business long enough, I know the trends
For decades, peak season stretched from back-to-school through the December holiday rush. If you still plan on that schedule, you will be caught flat-footed. Your competition is ready to pick up when you drop that ball.
Gut checks and reliance on historical demand trends don’t hold up.
Data visibility across previously siloed functions reveals a different picture. Today’s omnichannel environment isn’t making supply chain executives’ jobs easy. Having complete data visibility is critical for planning, execution, adaptability, and improvement.
What gets measured, gets managed. If you can’t “see” it, you can’t fix it.
You don’t know what you don’t know
The common reaction when our customers turn on our warehouse management software is, “We just didn’t know what we didn’t know”.
Modern WMS systems find problems that spreadsheets never will. Through custom warehouse KPIs and metrics, these systems measure and monitor warehouse performance on things like:
- Order accuracy rates
- Order cycle time
- Inventory turnover
- Hourly pick rates at the individual level
- Fill rates
- Customer satisfaction metrics
So when something unexpected comes along, like a labor crisis, you don’t have to rely on what’s in the warehouse manager’s scratch pad from last year.
Watch an example:
National Roper’s Supply sees a 40% decrease in labor hours a week with Deposco, marking its most efficient day in company history during Peak Season 2022.
Excuse #7: It’s more than my internal IT team can support
Warehouse management, order management technology, and process automation have come a long way in the last 10 years. Your IT team may be focused on keeping old WMS systems running. There is pushback on the workload they need to take on to adopt a new system.
In fact, for those who haven’t started down the omnichannel path, it’s not because they don’t see the value. Instead, the biggest challenge comes down to a lack of time and resources (35% of the respondents), according to the latest omnichannel order fulfillment trends.
The good news is that new WMS systems aren’t limited to on-premise solutions like the ‘olden days’. SAAS cloud warehouse management solutions don’t require server rooms. System updates and WMS integrations are handled “over the air” without downtime.
Your team doesn’t need to write custom code to bring disparate systems together. Out-of-the-box APIs let you quickly scale up and choose new features, or external integrations, as your business grows. If you have a flexible, platform-centric WMS system, you can turn those on easily (in months).
Excuse #8: But I already have a solution that works well enough
This is the toughest reason to let go. You’re not dealing with facts, your feelings, loyalty, cost, politics, or something similar. You may be on an easy first-name basis with “your guy” at the vendor. But the technology that got you here, won’t get you where you need to go.
It’s time for an honest examination of your business strategy and goals. Do you have what you need to keep pace? New features help organizations increase efficiency and profitability, reduce costs, and make customers and business partners happier.
The pace of business has changed. If you’re not learning and growing, your bottom line will show it.
What’s your excuse?
Blind objections, sunk cost fallacy, hubris, and inaction are poor reasons to ignore problems in your warehouse management operations. Inflexible fulfillment and WMS systems limit the change you can reasonably absorb into your operations.
Sure, you can bide your time if your process can support a small hiccup here and there. But, that’s your clue to start exploring more scalable solutions. When technology limitations dictate innovation and change, your options are suddenly few.
Don’t wait for a peak season disaster. Change is scary until you find the right path.
Peak season bundle