Warehouse Management Guide: Process, Benefits, Tips

Warehouses play a crucial role in the supply chain, serving as the heart of operations for businesses dealing with physical products.

Efficient warehouse management is key to ensuring that products are stored, tracked and delivered accurately and on time.

To achieve this level of efficiency, many organisations turn to Warehouse Management Systems (WMS). In this guide, we'll explore what a WMS is, its advantages, the types of warehouses, key features of a WMS and what to look for when choosing one for your organisation.

Whether you're a seasoned logistics professional or just getting started, this guide will provide valuable insights into the advantages of warehouse management into your business.

What is a warehouse management system (WMS)?

A warehouse management system (WMS) is a software application designed to optimise and streamline various warehouse operations.

It serves as a centralised platform for managing tasks such as inventory control, order fulfillment and the overall movement of goods within a warehouse.

A WMS leverages technology to enhance efficiency, reduce errors and improve productivity in the warehouse.

Advantages of warehouse management systems

Implementing a warehouse management system (WMS) offers a wide range of benefits that can revolutionise how businesses manage their inventory and operations.

1.Cost savings

Implementing a WMS in your supply chain can lead to significant cost savings by minimising operational errors, reducing costs and optimising space utilisation.

For example, a WMS can streamline warehouse processes, reducing the need for manual, time-consuming tasks. Automated inventory tracking, order picking and packing result in a more efficient workforce, saving on labor costs.

A WMS also allows for more accurate demand forecasting, which results in better inventory management and lower carrying costs.

2.Laser-sharp inventory accuracy

WMS offers real-time visibility into inventory levels and locations. This accuracy ensures you always know what is in stock and where it's located, reducing the risk of stockouts, overstocking and costly inventory write-offs.

Further, precise inventory data generated by a WMS facilitates better demand forecasting. Accurate forecasts lead to fewer instances of overstocking or understocking, saving money and improving customer satisfaction.

3.Higher integration within inventory lifecycle

WMS solutions can seamlessly integrate with other supply chain and enterprise systems.
This connectivity leads to a smoother flow of information and resources throughout the entire inventory lifecycle, from procurement to delivery.

For example, your WMS can be integrated with supplier systems to streamline the ordering process. This integration results in accurate order placement, reducing lead times and enhancing supply chain efficiency.

4.Improved customer relationships

By ensuring orders are picked, packed and shipped accurately and on time, a WMS contributes to enhanced customer satisfaction and loyalty.

It also facilitates better order tracking and communication, fostering trust between businesses and their customers.

Types of warehouses

Warehouses come in various forms, each designed to meet specific industry requirements.

Some common types of warehouses include:

1.Consolidated warehouses

These warehouses are used for consolidating shipments from various suppliers before forwarding them to their final destination. They are primarily designed for the short-term storage needs of e-commerce vendors.

Products received here are destined for shipment to nearby destinations, offering a convenient option for businesses of all kinds to dispatch parcels within a specific geographic area.

These warehouses play a significant role in optimising transportation costs and reducing transit times..

2.Cold storage warehouses

Cold storage warehouses are specifically designed for the storage of temperature-sensitive goods, such as frozen foods and pharmaceuticals.

These facilities find extensive use within the agricultural, food, and fast-moving consumer goods (FMCG) industries, with occasional applications in the chemical sector.

Temperature control and humidity management are critical in these facilities. Items stored in these specialised spaces have extended storage durations, and the maintenance of precise environmental conditions is paramount to prevent any compromise in product quality.

3.Smart warehouses

Smart warehouses are storage facilities featuring highly advanced solutions, such as:
  • fully automated AS/RS (Automated Storage and Retrieval System) technology,
  • robotics,
  • AI-driven sales forecasting, and
  • SaaS (Software as a Service) warehouse management software.
These smart warehouses primarily cater to the needs of large corporations managing extensive inventories comprising a multitude of SKUs (Stock Keeping Units).

Notable industry giants like Amazon and Walmart represent a select but substantial group of users leveraging the groundbreaking technology of smart warehousing.

4.Bonded warehouses

Bonded warehouses temporarily house incoming items until the required import duties are settled, and the designated recipient is present to receive the shipment.

Bonds are issued by the relevant authorities to provide compensation in cases where the owner defers payment until the consignment is officially released.

5.Public warehouses

Bonded warehouses temporarily house incoming items until the required import duties are settled, and the designated recipient is present to receive the shipment.

Bonds are issued by the relevant authorities to provide compensation in cases where the owner defers payment until the consignment is officially released.

Features of a warehouse management system

When evaluating a WMS for your organisation, consider the following key features:

1.Real-time inventory tracking

Monitoring your inventory in real-time enables you to stay informed about the stock levels of all your products.

An advanced WMS offers features for inventory tracking through Radio Frequency Identification (RFID) and barcode scanners.

Using this data, the WMS provides up-to-date figures on the dashboard, and the software generates comprehensive reports that you can access.

2.Picking, packing and shipping

A WMS helps businesses structure their picking and packing operations through:
  • zone picking,
  • batch picking,
  • wave picking,
  • and more.
This enhances efficiency and maximises the warehouse's overall performance.
WMS software also helps the generation of essential shipping documents, including the bill of lading, packing list, shipping labels and others.


A WMS can access many types of reports and analyses. These reports are generated by assimilating data from various warehouse operations into the software.

They can also help you methodically manage its warehouses, proactively detect potential issues, and mitigate risks.

What to look for in a WMS

When choosing a warehouse management system, keep the following considerations in mind.


With automation at its core, a WMS optimises the allocation of resources, including labour. It ensures that your workforce is utilized effectively, reducing the need for additional manpower as your business expands.

Select a WMS that not only meets your current requirements but also has the capacity to evolve alongside your business. As your operations grow and change, your WMS should be flexible and scalable to accommodate these shifts seamlessly.


Look for a WMS that seamlessly integrates with your existing systems, such as Enterprise Resource Planning (ERP) and Transportation Management Systems (TMS).

This interconnectedness streamlines your overall supply chain and data management, making your operations more efficient and productive.

3.Ease of use

User-friendliness is paramount. Opt for a WMS with an intuitive and accessible user interface, coupled with robust training and support options.

An easy-to-navigate system encourages rapid adoption, reduces the learning curve for your team, and bolsters overall operational efficiency.

4.Mobile access

Incorporate mobile capabilities into your WMS, empowering your workforce with real-time updates and information accessibility while on the warehouse floor.

This not only enhances productivity but also ensures that vital data is readily available where and when it's needed most.


Every business has unique processes and workflows, so the ability to tailor the WMS to your specific requirements is a pivotal consideration.

A customisable WMS allows you to align the system with your distinct operational needs, ultimately increasing efficiency and accuracy.

6.Support and maintenance

Robust and responsive support is essential to address any issues promptly and ensure the system operates at its full potential.

Regular updates and maintenance keep the WMS current and secure, helping your business stay at the forefront of industry standards.

Looking to integrate a new WMS into your warehouse?

The process of integrating a new WMS into your warehouse involves several stages, including assessment, selection, implementation and ongoing optimisation.

It's essential to involve key stakeholders, thoroughly evaluate potential solutions and provide adequate training to your team.

At The Sourcing Co, we specialise in delivering cutting-edge logistical solutions that are tailored to your unique needs. Our team routinely handles large product quantities on behalf of our extensive corporate clientele, while also executing dropshipping operations from our warehousing facility.

Our local team also acts as buying agents with our suppliers across Asia to ensure transparency.

Get in touch with us today and initiate a conversation about how our team can significantly enhance your business. Your path to success is just a message or phone call away.