Warehouse management system vs inventory management system
July 28, 2022
It’s a common misconception that warehouse management and inventory management are the same thing. After all, your inventory tends to reside in your warehouse, right? So it’s not all that surprising that there can be some confusion between the two.
So, what is the difference between a warehouse management system and an inventory management system? Well, in this blog post we define the key differences that make these systems unique and also crucial to driving efficiencies within your business.
What is warehouse management?
Warehouse management is the system which is responsible for managing all aspects of a warehouse - including the human elements. This covers:
- Organising the space itself efficiently so that your pickers and packers can easily access inventory that is commonly purchased together
- Organising your warehouse staff, including team rotas, any targets you have, breaktimes, sector rotations and more
- Using data to forecast demand so that you can factor this into both the organisation of the space and the warehouse team(s)
- Creating step-by-step guides for your teams to follow in order to use both your warehouse space and shift times as efficiently as possible.
In order to do the above and maximise the value you get from every inch of space in your warehouse, managers will implement a system to drive efficiencies. This may be a more traditional, manual system of organising the space and rotas, or using technology (such as PDA systems) when it comes to tracking the location of inventory. Or, warehouse managers may use a combination of both, such as implementing signage within the warehouse space, combined with PDA technology to scan items picked and packaged and provide the warehouse manager with valuable data and insights.
The main benefit of having a dedicated warehouse management system is to make the most of your warehouse space. This is vital in order to ensure accurate and on-time delivery, which is essential to customer satisfaction. Delays here can have a significant knock-on impact to fulfilment. Similarly, the lack of an automated management system can lead to an increased risk of human error - such as forgetting an important part of the order in the packing process. This is where technology can work alongside your warehouse team to minimise the risk of both delays and errors.
What is inventory management?
Inventory management is the process of understanding your stock mix - including products and component parts - and how supply and demand fluctuations and overhead costs should impact the level of inventory you hold at any given time.
Mastering inventory management perfectly can:
- Save you overhead costs (by making the most of each sq.ft. of warehouse space)
- Improve cashflow (by ensuring too much hasn’t been invested in unsold inventory at any one time)
- Drive overall business efficiencies (thus improving supplier and customer satisfaction levels)
Ultimately, the best way to effectively manage your inventory is to have access to as much data as possible. This includes current stock levels, forecasted sales and required stock levels and information about other elements that can impact the viability of stock - such as use by and best before dates, or technological updates (which may cause your inventory to lose value when held onto for too long).
What is the difference between inventory and warehouse management?
Unlike with warehouse management, inventory management is not people-focussed. This is the easiest way to distinguish between the two types of process management. Warehouse management includes the management of the warehouse space and people that work there. Inventory management is simply the management of the inventory itself - i.e. all raw materials, parts and products that your business holds stock of.
How can inventory management and warehouse management be made more efficient?
Running a warehouse and managing your inventory can be extremely costly, but luckily, there’s an efficient and convenient way to reduce warehouse costs with our innovative warehouse and inventory management system. StoreFeeder’s inventory and warehouse management software will allow you to save on management and operational costs by providing real-time data, minimising supply chain issues and giving you 100% real-time visibility over your inventory with an ecommerce integrated barcode/SKU-driven picking and packing system and much more.
StoreFeeder’s streamlined warehouse management system will make complicated tasks like inventory control and managing orders a breeze, while saving your business money. Supporting a range of duties vital to the smooth running of warehouse operations, StoreFeeder will also enable multiple warehouses and fulfilment partners to merge with ease, so your management system can scale with your business.
You can arrange a free demonstration here.
Take the stress out of running your business with StoreFeeder, which will help you save on management and operational costs. Take a look at our price list and get in touch with us today for a free demonstration.