If you’re wondering how third-party logistics providers can efficiently monitor inventory and deliver goods on time, the answer lies in their industry-developed 3PL warehouse management system (WMS).
A WMS is software that 3PLs use to perform and simplify warehouse tasks. It also integrates the warehouse team with other aspects of the supply chain, ensuring smooth operations.
With this system, 3PL providers can speed up processes, reduce costs, and increase revenue. Due to its crucial role in the supply chain, business owners should familiarise themselves with this software, especially when choosing a potential 3PL partner.
So, in this article, we explain what a warehouse management system is and how it can benefit your operations.
What is a 3PL Warehouse Management System Software?
A 3PL warehouse management system (WMS) is software for handling warehouse tasks. Its chief purpose is to streamline operations, reduce errors, and expedite the process.
With WMS software, it is easy for 3PL providers to stay on top of things and deliver satisfactory service.
There are several WMS designs that third-party logistics providers may use. However, they generally have similar features, including inventory management, order fulfilment, cost calculation, and report generation. Let’s review these further to understand their importance for your business.
1. Inventory Management
The 3PL warehouse management system plays a vital role in managing your inventory, particularly during these stages:
- Receiving. Once your inventory arrives at the warehouse, the staff checks its quantity and condition, noting any signs of error or damage. All these data or notes go into the WMS software for easy tracking.
- Storing. After receiving the inventory, the staff transfers the items into their designated storage location. Bin, pallet, or shelf codes are all in the 3PL software to make items easy to locate once an order comes.
- Monitoring. The warehouse staff ensure item counts are correct and updated. With the WMS software, it is easier for them to check goods in real-time rather than do periodic manual inventory counts. The software also lets them spot merchandise that is fully stocked or for replenishment.
Storing and checking multiple items from several business owners can be challenging without technology. Without WMS software, the chances of overstocking or understocking are high. This problem, in turn, will only result in wasted resources and profit loss.
2. Order Fulfillment
Another crucial function of the 3PL warehouse management system is to ensure the efficient delivery of items ordered. Here’s how the software works during this stage:
- Picking and Packing. When an order comes, the staff checks the software for the items to be picked and packed. Every item removed from storage is efficiently scanned and recorded in the system. The packing requirements of each product should be in the software as well, making it easy to have it ready for shipping.
- Shipping. With the 3PL software, the warehouse staff can quickly search for the right last-mile carrier to deliver the order. Depending on the system design, some software can automatically suggest the best carrier for the job. Others give a list of available carriers, allowing the staff to choose according to the best time and price.
The use of WMS software in the order fulfilment stage allows 3PL providers to speed up the process and minimise order mistakes, resulting in increased customer satisfaction.
3. Cost Calculation
The cost of 3PL services varies from client to client. Factors like labour, storage, and value-added services can make cost tracking even more challenging.
A reliable and automated warehouse management system solves this problem. With this software, 3PLs can collect and record all transactional data from fulfilment activities in real time. These may include storage, labelling, packaging, and shipping charges.
After data collection, 3PLs can generate invoices to the client.
With WMS software, 3PL providers can automate and streamline billing tasks for better efficiency and accuracy. On the other hand, business owners can use it to design a custom billing process that aligns with their operations and cash flow structure.
4. Report Generation
Most WMS software often has a reporting and analytics function. This feature lets 3PLs and clients gain valuable, real-time data that they can use to spot problem areas and room for improvement.
The 3PL software can help business owners find ways to perform better, address or prevent complaints, and make informed decisions.
So, when assessing a warehouse management system, look for:
- tools that track performance metrics like order accuracy, on-time delivery, and inventory turnover
- options for generating tailored reports that provide data relevant to your business
- advanced analytics that can forecast demand or identify trends for better strategic planning
What Are the Benefits of Using 3PL Warehouse Management Software?
A good warehouse software benefits a 3PL provider by simplifying complex tasks. However, it also gives businesses a competitive advantage through:
- Improved visibility. The 3PL WMS software provides companies with immediate, real-time visibility of their inventory levels and order status anywhere, at any time. Aside from preventing overstocks or stockouts, it helps businesses make timely, data-driven decisions.
- Automated accuracy. Mistakes in the supply chain can be problematic. As WMS reduces manual inputs, you also lower the chances of costly errors. Also, automated process means faster, more efficient and consistent operations.
- Customer satisfaction. Customers also get real-time and accurate tracking reports of their deliveries through the 3PL software. Moreover, this system ensures quick responses to customer enquiries about item orders or returns.
- Seamless scalability. The 3PL WMS software is a highly flexible tool. You can adjust stock level or variety, packaging requirements, transport options, or warehouse location with just a few clicks or taps. It’s a strategic investment that adapts to changing 3PL needs and supports future growth or expansion.
Arm Your Business with Automated Programs and Tools
Managing the supply chain and overcoming logistics challenges do not only rely on good infrastructure, skilled staff, and transportation services. Technology, like the 3PL warehouse management system software, is also essential.
With the WMS software, 3PLs can efficiently receive, monitor, and bill supply chain activities. Likewise, businesses working with them can confidently satisfy their customers, improve their operations, and stay ahead of the competition.
If you’re looking for a 3PL partner in Melbourne, click on this link or you may contact Effective Logistics today. Our team will help you find the WMS solutions that fit your business.
