In today’s market, sophisticated technology allows companies to respond to increasing consumer pressure and ever-shrinking delivery windows. ERP (Enterprise Resource Planning) and WMS (Warehouse Management System) systems have become the backbone of distribution, wholesale, supply chain or FMCG businesses. These systems are able to handle large amounts of data, capturing every barcode scan, mouse click and inventory movement. They are designed to improve productivity, efficiency and accuracy whilst reducing overall operational costs.

What is WMS?

Simply put, a Warehouse Management System is a software solution designed to support and optimise the daily operations of a warehouse. A WMS provides real-time inventory visibility and control from receipt, through storage, to shipment.

The primary focus of a WMS is to control the movement and storage of stock and its associated transactions including receiving, picking, packing and shipping. The system also directs and optimize stock put-away based on real-time status of bin utilization.

What is ERP?

Enterprise Resource Planning is a business management software that automates business processes across all departments of an organization like purchases, sales, marketing, human resources, services, inventory, financial management, etc.

The main focus of an ERP is to improve the access, flow and sharing of information across an organization.

The main difference

ERP systems were created to operate within the world of business and finance reporting, whilst WMS was specifically designed to handle the supply chain and/or manufacturing data and processes.

Some ERP solutions have expanded their offerings to integrate WMS modules. However, these don’t usually offer the optimization of inventory based on real-time information and don’t have the ability to generate reports based on historical trends and data. For example, an ERP system may be able to track inventory locations but not be able to make warehouse layout recommendations.

Which one does your business need?

Before deciding between ERP and WMS system you should carefully examine the technical requirements of storing and moving your products. No matter which system you choose, it should guarantee uninterrupted receipt, storage, movement, delivery and dispatching of goods.

Some small businesses might not require true WMS functionality and could benefit from a basic WMS module within their ERP solution. WMS is indispensable in businesses with large facilities and high order volume or for businesses with multiple storage locations.

How do they work together?

A WMS system adds more sophisticated functionality to an ERP system. This enables organizations to continuously monitor products’ progress as they move in, through and out of the warehouse; keep the receipt, storage and movement of goods under control; and use real-time intelligence to optimize product location and shelf duration.

Integration happens when the WMS interacts and synchronizes data seamlessly with the ERP, allowing all areas of your business to have full supply chain and inventory visibility. Data synchronization errors or failure can lead to inventory inaccuracy which would be highly detrimental and defeat the purpose of having a WMS to begin with.

Although ERP integration is one of key factors when choosing a WMS, it’s also a very common challenge with many implementations. Some WMS solutions are not well equipped to handle other platforms’ data and code. Therefore, when shopping around for a WMS, you should look for a company with proven expertise and a record of successful deployments.

At iWMS Australasia, we combine HighJump technology (which supports many web service, socket-based, and integration protocols) with our team’s proficiency in all the major file formats to create tailored solutions. The core software architecture can be easily adapted in a fraction of the time of conventional systems, and at a fraction of the cost!

Read HighJump’s article on ERP X WMS cost factor here.

Click here to download HighJump’s Enterprise WMS full brochure.