The digital transformation taking place across society has significant implications for the warehouse sector, particularly as consumer expectations are changing. You've probably heard this refrain before. The anywhere, anytime access to information and applications allowed by cloud and mobile technologies has created a consumer landscape in which people can get what they want, when they want it. This has changed a variety of sectors, and the retail industry has proven central to this change.
If somebody is in a store and they like a shirt, but don't like any of the colors available, he or she can hop online and buy the preferred item immediately. Throw in being able to shop conveniently at home or from social media sites where friends are making recommendations and you have an e-commerce revolution. However, as consumers have come to expect greater responsiveness when they shop, they also anticipate getting their orders quickly.
Waiting around for inventory checks, order processing and long shipping cycles is becoming incredibly unpopular, and warehouse operators are facing incredible pressure to ramp up their fulfillment capabilities in response.
E-Commerce challenges driving warehouse innovation
According to a Logistics Management study performed by Peerless Research Group, the warehouse industry has increased its spending on new equipment in response to the growing demands created by e-commerce fulfillment. While some of this spending has come in the form of traditional solutions, many of the investments are putting information systems at the center of innovation.
Industry expert Norm Saenz told the news source that fulfillment services in the retail sector weren't initially designed to meet the needs of today's e-commerce companies, making innovation essential.
"Many of the retail industry DCs weren't designed to deal with e-commerce-size orders, so you just can't get those orders out of the building very effectively without investing in new material handling equipment of some kind, or in information technology systems," Saenz told Logistics Management.
This is the reality facing warehouses today – innovate quickly or risking falling behind customer requirements. Warehouse management software systems play a critical role here, creating a central hub for data management, process automation and similar tasks that keep a fulfillment center running smoothly.
Using warehouse management technologies to keep up with retail demands
Warehouse management software has long had a reputation for helping organizations coordinate operations across environments within the warehouse. From simplifying serialization processes to automating tasks like preparing items for shipment and gaining visibility into inventory levels, a good warehouse management system can serve as an innovation hub that frees managers to establish the most efficient environments possible relative to specific operational demands.
The problem, for a long time, has been the entry cost of implementing a robust warehouse management system. Purchasing IT hardware, installing software, getting end-user devices configured to run the system, managing licenses, putting specialized hardware, such as barcode scanners, into place and similar overhead created incredible costs beyond simply getting software. This led to warehouse management software being used almost exclusively for large fulfillment centers. However, this technical environment is shifting in light of cloud computing's rise.
Using the cloud to streamline warehouse management innovation
Cloud computing offers an economic advantage that warehouse managers can use to drive technological gains without taking on excessive costs. A report from DC Velocity pointed out that warehouse management systems housed in the cloud turn the technology into a rental, making it a much more accessible technology.
The cloud isn't a cure-all, and does present some challenges. The news source pointed to security issues, which have long held back cloud investments, but also been counteracted with a wide range of strategies, as one issue. However, even more pertinent to many warehouse operators as security risk can be mitigated is the problem of performance. The report mentioned that latency in data delivery can cause problems in warehouses processing large numbers of orders at any time. This issue can be surmounted by using the cloud strategically to use a warehouse management system to drive positive change where most applicable and turn to other options for performance-sensitive workloads.
As warehouse management systems evolve to become more accessible, they are emerging as a prime option for warehouse teams trying to keep up with the new pressure created by the rise of e-commerce. As cloud-based warehouse management tools become more secure and adapt for performance-sensitive workloads, they give warehouses an opportunity to take advantage of robust IT capabilities to streamline order processing and fulfillment, driving the innovation needed to keep pace with new customer demands.