How a 3PL WMS needs to be different from a Standard WMS?
The 3PL market is growing. It is crucial to have technology that can keep up with demand and pace for consumer satisfaction. Warehouse operations all consist of a range of various operations. Which includes management of inventory, tracking orders and labor management. With a 3PL (third party logistics) provider, the biggest differences are that they do not own the inventory and all transaction costs must be accounted for against each customer. Discover how a 3PL WMS needs to be different from a standard WMS?
What is a 3PL and why are they important?
3PL providers can offer services to move stock through the current supply chain on behalf of the owner. This would include simplifying import and export of goods from local and overseas transportation, warehousing goods, and executing orders fulfillment.
A 3PL WMS must treat every customer as unique, both in inventory management and transactions. 3PL’s cannot have the same processes across the warehouse but need the ability to tweak processes particular to each customer.
Larger manufacturers are often better off to slice out all their different business segments into smaller buckets and outsource them to different 3PL’s, that best meets the need to that product line. Manufacturers cannot keep up with the market demands trying to do everything under one warehouse roof when the needs are so diverse across products.
3PL’s are uniquely setup to meet the challenges that manufacturers face on a case by case scenario. 3PL’s typically have a common type of customer they cater to, often from and for companies in the same market.
3PL’s specialize in inventory management and have perfected the efficiency of processing goods through the supply chain. They have to keep up with the market demands through technology in order for it to be more cost justifiable than companies warehousing their own goods. In addition, they need to ensure there systems are perfected in order to compete with other 3PL’s.
What are the 3PL WMS Benefits?
Better management of inventory
A key components of a WMS is that it makes inventory management quicker and easier by providing instant real-time information. A WMS can control all warehouse activities and provide visibility of events. This means you can trace all units within the warehouse at any stage within the order fulfilment process. The key with this is keeping each customer’s inventory independently managed.
Key Performance Indicators (KPI)
Determining whether you are meeting your financial objectives and getting the most productivity out of your staff can be difficult. In a 3PL, since all activity needs to be accounted for and costed per customer, this becomes more critical. Reporting needs to be available for every aspect of the business that determines profitability. Reporting often needs to be customized to deal with unique requirements. One of the benefits of a WMS system is it can be tailored down to the inventory, labor and order for multiple clients.
3PL providers should be able to provide information about current stock instantly. Being able to have real time information on a mobile device or tablet can be a huge advantage. Having this key information within everyday devices can be essential for purchasing decisions, managing product quality and fulfilling all sales demands. The customer also needs the visibility through a web portal.
Additional billing support
Your 3PL warehouse could be essentially running various operations which can potentially lead to billing challenges. A 3PL WMS has the functionality to simplify all billing processes for each customer appropriately. There are multiple options for all steps to be billed uniquely to each customer needs.
Opportunities to grow your warehouse operations
Technology is always evolving and so must a WMS system. WMS systems should be updated regularly with new features, and your IT staff must keep on top of the upgrades to take advantages of the improvements. WMS systems must also adapt to the new forms of automation by connecting seamlessly to other technologies. Growing businesses will need the ability to constantly improve and introduce new advancements to remain cost competitive.
Third Party Logistics companies offer key advantages to companies as an alternative to managing their own warehouses. These advantages come only when the 3PL can perform the job better than someone not specialized in strictly warehousing. The only way for a 3PL to outperform is through investment in software technology within the warehouse to optimize efficiency. Once achieved, it builds a positive reputation of your business with your customers. For further information on our Third Party Logistics solutions, contact us today.