Why your WMS should be integrated with your ERP solution

If you are in the market for a new WMS (Warehouse Management System), you’ll already know that there are a lot of options out there and the range of choice can be overwhelming. To help you focus your search, we strongly suggest that you stop looking for a standalone WMS entirely and instead, take a step back and look at the bigger picture. No business is “just a warehouse”, so you shouldn’t be looking at software that’s just for the warehouse. You should be looking for a whole package to integrate your warehouse with the rest of your business.

In principle, you have three options when it comes to choosing a WMS.

 

1. A standalone, specialized WMS

The issue with this is obvious. You might choose an excellent warehousing solution that precisely supports all your warehousing processes to the highest standard however, a standalone solution won’t be able to “talk” to the rest of your business. Purchasing, sales, and accounting will all be handled by other software which generally means you have to enter all your data separately which is A. more time-consuming and B. more susceptible to mistakes and inconsistencies. With some software combinations, it may be possible to arrange integration of standalone solutions with your ERP (enterprise resource planning) system, but in the vast majority of cases, this is costly, time-consuming and often fraught with problems and setbacks.

 

2. Buy a large all-in-one ERP solution

This is a better option. Here you buy one large piece of software which will cover all areas of business, including your warehouse. You only have to enter data once, it is all stored in a central database so everyone will have access to the same data, your employees will only need to be trained to use one solution. You can use the MRP module of your solution to help you keep your warehouse correctly stocked and optimize replenishment strategies and much more.

However, there is a catch and that catch is money. This kind of solution is big and expensive. Because they are designed to be used in a wide range of types of businesses, across all industries, you’ll find a lot of functionality in them that your business probably won’t ever use, but you’ll still have to pay for the privilege anyway. And what’s more, the development strategy of this kind of software won’t be driven specifically by the needs of businesses of your size or in your sector so the software might head in a direction completely irrelevant to you. However, if you have a large business operating within a broad scope, and access to the capital to make a large upfront investment, this model might suit you very well.

 

3. General ERP solution with specialized add-ons/ extensions

There is a third option which usually is a very good fit for SMEs. You buy a general ERP solution for SME’s which covers standard business functions such as accounting, CRM, etc., and also has the option to purchase extension products either by the same provider or third parties who have designed their extensions specifically for that software. This means you get all of the advantages of an all-in-one solution but at the same time, you get to pick and choose which extensions you actually need and you only have to pay for those. One example of this kind of solution is SAP Business One which has an extension for everything you can think of on the market.

Sometimes businesses can be put off by the idea of buying a custom-built package like this, as opposed to a single solution however we would caution against this. As long as the extension has been designed specifically for that software, you needn’t fear integration issues. You should be aware that some extensions are standalone products that are adapted to be integrated with a general ERP solution retrospectively. This can come with some issues in itself, so you should definitely ask about the history of the solutions you are considering. Also, be wary of extensions that use a separate database to the main ERP solution. Somewhere along the line you might get some nasty surprises in the form of data synchronization issues so always be sure to do your research and get references from current users of the system before committing.

Another advantage of this model is that the extensions are usually highly specialized, developed by companies with hands-on knowledge and experience of the specific area they are catering to. Their development strategy will usually also be focused and very often, driven by real customer needs within specific industries or business types which should mean that the solution will evolve in tandem with your business and consequently have more longevity in your business.

It is also usually possible to implement this kind of system incrementally to minimize disruption to your business. So you can get your business up and running on the main ERP solution first, then add in your warehouse, factory and so on, one at a time, if you so choose.

If that’s not convincing enough, we, as a company, have put our money where our mouth is too. When we set out to create a warehousing solution for SMEs, we specifically chose this model as a basis for our own CompuTec WMS (with SAP Business One for core ERP functionality) because it was clear to us that it was the best way of offering a full but specialized functionality set, flexibility, value for money and most importantly, seamless communication between the warehouse system in the warehouse and the system in the rest of the business. For us, and in turn our customers, it came with the added bonus that we could also offer SME manufacturers a solution for advanced production processes that is also fully integrated with the warehouse.

That being said, it is certainly not a case of one size fits all. When we talk about models, we are, of course, talking in terms of generalizations and in the world of business, everyone has their own unique needs and ambitions. When picking out a WMS or any software from the crowd, it’s about finding the solution that’s right for your business and help you run your business better.

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