In today’s competitive retail and ecommerce landscape, shoppers have plenty of options when choosing where to spend their dollars. One thing they are increasingly looking for from brands is a seamless interaction. From placing an order to delivery, and every step in between, shoppers have come to expect a stress-free experience. One element of the 3PL ecosystem that proves to be highly effective in contributing to a smooth experience for shoppers is the use of a 3PL warehouse management system.
How exactly does a 3PL warehouse management system equate to a happy shopper? Let us tell you more!
Third-party logistics providers offer a wide range of services that each play an essential role in a shopper’s purchasing journey. A 3PL partner can provide you with services that include warehousing, inventory management, fulfillment, shipping, delivery, and even returns. And helping these 3PL services to operate efficiently is a 3PL warehouse management system (WMS). The WMS works to optimize these 3PL services in order to improve the logistics experience for both the brand and their shoppers.
Throughout this article we’ll take a closer look at some of the benefits specific to the 3PL warehouse management systems, and how they play a role in keeping things organized. But first, let’s cover some basics.
What is a 3PL warehouse management system?
A 3PL warehouse management system is the internal processes that keep warehouse functions organized and operating efficiently in order to deliver an effective fulfillment and shipping experience.
Top warehouse management system functions
There are a variety of functions and processes included in warehouse management systems. Each of these play a role in moving inventory and orders through the supply chain and onto their final destination. And each of these functions, when operating optimally, help to create a positive overall fulfillment and shipping process.
Warehouse management system functions include:
Receiving inventory
The first step of the WMS is receiving inventory into the warehouse. Upon receiving the products, warehouse employees will validate the inventory. This includes checking the quantity received, verifying the condition of the inventory, and making notes of any damages or errors. All of this information gets tracked using the WMS.
Put away
The 3PL warehouse staff then places the inventory into designated locations in the warehouse. The chosen locations will be optimized to make picking and managing the inventory easier. The storage locations, whether in bins, on pallets, or on shelves, will be documented in the 3PL system for easy locating when an order for that piece of inventory is received.
Inventory management
The warehouse staff will continuously ensure that the pick locations are stocked and will replenish them from overflow when necessary. Another aspect of inventory management is making sure merchandise counts are up to date. This can be done through periodic inventory counts (a physical count done monthly, quarterly, annually, etc.), or by using a perpetual inventory system.
Picking
Another part of the WMS is optimizing how inventory is picked. The 3PL ensures that they are picking efficiently and ensuring the correct inventory quantity is picked for each order. Each item is scanned when it’s removed from its location so that the inventory is accounted for within the warehouse management system.
Packing
Next up is packing the order for shipping. Packing requirements and specifications for each product are typically agreed upon during the original SOP between the 3PL and the brand.
Shipping
The final function of the WMS is shipping the order out of the warehouse to the final destination. The 3PL will select a last mile carrier to deliver the order. Once the carrier has collected the order, the order is marked as shipped, and if available, last mile delivery tracking information will be provided to the shopper so they can anticipate the order’s arrival. This is not a step overlook, as choosing the right last mile carrier can really help to elevate the fulfillment process.
4 benefits of a warehouse management system
3PL warehouse management systems offer a number of benefits for brands looking to improve their operations and processes while reducing costs at the same time.
1. Cost savings
One of the most significant benefits of using 3PL systems is cost savings. By outsourcing your logistics to a third-party provider, you won’t need to invest in expensive equipment, software, or hire extra employees to manage your inventory. Additionally, a 3PL can often provide lower costs on warehouse storage fees and shipping charges since they have access to discounted rates due to their volume discounts with carriers. In this Third-Party Logistics Report, 75% of companies stated that outsourcing logistics to a 3PL contributed to reduced logistics costs.
2. Improved visibility
Another benefit of using a 3PL and their warehouse management systems is improved visibility into the process thanks to some helpful optimization data. These 3PL systems are designed to make it easier for brands to track inventory levels in real time, which helps prevent stockouts or overstocks by providing an accurate picture of what’s available.
3. Accuracy & efficiency
Additionally, these systems improve the efficiencies of order fulfillment, picking, packing, and shipping. The warehouse management systems help contribute to reduced errors while also speeding up operations.
4. Shopper satisfaction
Finally, using the 3PL warehouse management system can also help improve shopper satisfaction, be it for deliveries or returns. Ultimately, shoppers will receive their orders quicker, since the processes are streamlined for maximum efficiency. This leads to improved shopper satisfaction due to faster turnaround times for orders as well as enhanced accuracy in order fulfillment.
With greater visibility into your supply chain in real-time, combined with improved data tracking capabilities, warehouse management systems can help streamline processes while increasing efficiency. This translates into increased profits for your business and greater shopper satisfaction.
