Our peak season performance series resumes today with a look into how supply chain execs are gauging the ROI of new logistics technologies, including warehouse management and order management systems.
Modern WMS solutions are vital components of any scalable peak season strategy. According to our North American Peak Season report, 92% of supply chain leaders agree that WMS and OMS systems will prepare their warehouse operations to be more profitable during peak season. Of this group, 70% are already implementing WMS or OMS solutions now.
Savvy supply chain leaders know they need to invest in tech, but identifying the right logistics technology solutions can prove challenging in a market flooded with options. If you’re working on a business case for software that can improve your fulfillment operations, then it’s critical to understand the ROI for the solutions you choose.
Investments in WMS and OMS platforms are top of mind for good reason this year: When asked which areas of their business need the most improvement, nearly half of respondents (48%) named warehouse management as a top concern.
To invest or not to invest in WMS: Is it really a question?
First, let’s talk about the 22% of retail leaders who realize the benefits of a WMS/OMS but don’t plan to make investments in 2023.
There could be many reasons why a supply chain professional would see the need for specific software and not invest. However, the most likely culprit is the challenge of developing a convincing cost-benefit analysis that will win over internal stakeholders.
Presenting the business case for integrated WMS and OMS
Michael Johnson, our vice president of business consulting, helps supply chain management leaders understand technology implementation and how integrated WMS and OMS systems work — but he sometimes sees them struggle to present a business case in a comprehensive or accurate way.
If you’re working on making a business case for warehouse management software, it’s critical to understand both short- and long-term ROI.
According to Johnson, it’s very possible to recognize value from warehouse software in just a few months, especially when you look for a solution that can be implemented quickly and without disruption to existing operations. “Not only will you have that fast ROI,” he said, “but you’ll be ready to grow and scale easily after that initial implementation.”
To build a strong ROI story and choose WMS investments that will be foundational to success and create a clear path to revenue, look for an integrated system that:
- Connects seamlessly to ERP, ecommerce platforms, and sales channels without friction or extensive time/effort.
- Deploys fast with simplified onboarding.
- Supports real-time inventory visibility across all channels.
- Increases order throughput and accuracy.
- Scales quickly to support growth without heavy IT resources or custom projects.
- Makes elastic fulfillment capacity possible so you can adjust to unpredictable peak loads.
- Works not only for this peak season but for future peak seasons.
“When done correctly, these integrated WMS and OMS solutions not only provide strong ROI but also do so in a very timely fashion,” Johnson said. “Expectations for investment returns have shifted, and businesses want to recognize value right away — in as few as two or three months.”
To avoid concerns about systems integration — a business area that 43% of supply chain leaders say needs the most improvement for peak season — be sure the system you choose will work with the types of supply chain systems and automation technologies you’re currently using and considering. WMS integrations with other platforms should be fast, easy, and inexpensive. The WMS shouldn’t require lots of consulting or custom coding every time you need to add something new.
Watch this example with 3PL company Drive Fulfillment. After implementing our WMS for third-party logistics, they can now bring on a new client or onboard a new aspect of a client’s program, in single-digit days:
Your WMS company should be a strategic business partner
While platform features and benefits are important, remember this: The partner behind the WMS matters just as much as the solution itself.
To effectively roll out a WMS or OMS, look for a provider and partner that offers:
- A comprehensive understanding of your operation and the challenges you need to overcome.
- The means to identify and eliminate implementation barriers to ensure speed to value.
- A capability to shift burdens from your people to your processes to improve productivity, the employee experience, and worker retention.
- Predictable, flexible growth plans that help you to scale your business.
Get both fast ROI and long-term value
Warehouse management and order management technologies create the foundation for inventory, operations, and other technology systems. Getting these types of solutions in place is the first step to deploying automation, which more than half of respondents (55%) say they’re also prioritizing this year.
To start on the right foot and see ROI quickly, Johnson suggests beginning with a small project to see success right out of the gate instead of trying to launch all new systems, technologies, and processes at once.
A WMS that works at your pace
“Crawl, walk, run” is the motto he uses: Get started, give your team and processes time to acclimate, and continue to integrate your WMS or OMS into your workflow as it makes sense with a team who knows your business and will remain consistent. Most importantly, don’t get locked into software that can’t scale with you. Instead, ensure you choose a WMS solution that allows you to add new features and functionalities as you grow.
Where are you on your warehouse solutions journey? How do your preparations for peak season compare to what other retail leaders are doing?
Take our Peak Season Performance Quiz
Get some mid-season benchmarks and best practices for improving the performance of your supply chain this season and beyond. The assessment grades your company based on 3 ‘pillars of readiness’ that are crucial to long-term growth: preparation, agility, and efficiency.
Or, download the full research report to learn more about peak season priorities, concerns, and challenges in 2023.
👇 CONTINUE THIS SERIES below 👇 or Return to the beginning.