• Inventory Management
  • Warehouse Management
  • Digital Transformation

How to Create Value with Warehouse Automation Software

Written by Robert Brice
December 21, 2022

Overview:


Enormous pressures weigh on today’s supply chains. Chronic labor shortages, economic uncertainty, and ballooning input costs create an immediate need for alleviation to stay nimble and solvent. Companies that fail to address these hurdles risk falling behind.

Technology is a proven means of reducing overhead and eliminating inefficiencies that put a drain on warehouse operations. Implementing the right warehouse automation software can help you digitally transform obsolete inventory processes to vault ahead of competitors.

However, diagnosing exact areas of inefficiency and how to optimize them can be difficult.

This guide will explore warehouse software’s role in perfecting accuracy, removing bottlenecks, and improving profitability in the warehouse.

 

WATCH VIDEO BELOW: Clif Bar takes a bite out of inefficient paper inventory control—

 

Solving Warehouse Problems to Create Value

70% of inventory operations focus technology on the inbound warehouse.

—2022 Digital Inventory Report, RFgen Software

As any manager knows, warehouse inventory processes need to be automated as much as possible to maximize efficiency at minimal cost.

Fortunately, implementing even small changes can make a big difference. The answer may lie with technology. Automation software has been shown to significantly improve key warehouse KPIs while slashing waste.

And while many options exist, from full-featured WMS platforms to robotic automation, often these hefty solutions come with undesirable—if not excessive—burden and expense. Benefits can’t be realized until one or more years after the fact. ROI is out of reach. Meanwhile, daily operations must work around disruptions caused by the implementation.

Other warehouse management solutions like mobile barcoding provide a cost-effective, time-proven alternative for solving inventory challenges. With shorter implementation and ROI periods, value is still unlocked but the benefits are immediate.

Get industry insights with RFgen's 2022 Digital Inventory Report | Download Now

 

Benefits of Warehouse Automation Software

After automating your manual processes with a mobile data collection solution, your warehouse can expect drastic improvements in the following areas:

  • Simpler, faster processes and workflows
  • Very high levels of inventory accuracy
  • Greater employee efficiency, productivity, and mobility
  • Reduced operating, storage, and handling costs
  • Higher customer service and satisfaction
  • Greater agility in responding to market conditions
  • End-to-end traceability for compliance and risk mitigation
  • Shorter training and onboarding periods, ideal for seasonal hiring
  • Safer, more attractive workplace for talent acquisition and retention

Now that the benefits of warehouse inventory software are clear, let’s take a look at common bottlenecks and how to solve them.

 

The Inventory Error Problem

Where Manual Data Collection Fails

Manual inventory control can only achieve 50-60% accuracy.

While you may be aware that inventory accuracy directly correlates to cost, you may not be as aware of how significantly manual data collection increases errors, drains productivity, and bloats operating costs.

Inaccurate data diverts warehouse employees to spend extra time looking for and recounting stock because they can’t trust their ERP or system of record. Incorrect counts also increase the risk of stockouts and lead to overstocking items that rapidly depreciate in value. Costly returns, charge-backs, and erosion of trust with customers can result as well.

Manual processes take many forms: pen and paper, spreadsheets, wheeled computer carts, or tribal knowledge. The single most impactful warehouse strategy is to replace these outdated methods with mobile inventory solutions like mobile barcoding.

Mobile barcoding can drive accuracy to 99.9%, optimize workflows through automation, and act as a workforce multiplier for shorthanded staff.

 

Mobile Data Collection Eliminates Errors

83% of warehouses use barcode scanning but only 58% use mobile devices.

–2022 Digital Inventory Report, RFgen Software

Warehouse automation software can be used with mobile barcoding to streamline inventory processes.
Warehouse automation software can be used with mobile barcoding to streamline inventory processes.

Adopting a mobile data collection solution automates manual warehouse processes, removing opportunities for human error.

What is mobile data collection?

Mobile data collection takes the form of AIDC, or automated identification and data capture, better known as barcode scanning. Advanced mobile data collection solutions like mobile barcoding provide next-level capabilities with warehouse mobile apps and real-time bi-directional data exchange with ERP software.

Mobile barcoding software streamlines inbound, outbound, and field services for inventory handling. Workers no longer have to walk back to a fixed workstation for data entry or to wrangle paper printouts. Instead, barcode scanning automatically records transactions in the ERP as each action occurs.

Warehouse barcode systems dramatically enhance transparency, throughput, and value. With mobility, even greater benefits are gained.

READ THIS SUCCESS STORY: How Myers Tire Supply burned rubber to double speed in receiving »

 

Combating Inventory Shrinkage

A common issue with manual inventory handling is missing inventory, or “shrinkage.” The inventory may be listed in the ERP system, but in reality that item doesn’t exist on the shelf.

For example—

If a warehouse with $1 million of inventory in the books conducts a physical count revealing only $950,000 on hand, they have a shrinkage of $50,000—or 5%.

Shrink may be caused by a number of reasons, including data errors, miscounts, misplacement, damage, and theft, to name a few.

Manual handling is not a warehouse best practice. It leaves your operation open to higher levels of shrinkage due to the latency between when item movements occur versus when they are documented. Materials can be easily lost, misplaced, or left to expire.

To reduce shrinkage, warehouses need real-time, point-of-scan mobility to ensure stock levels are always up-to-date. Business value is added by reducing inventory losses and enabling your operation to deliver greater throughput at higher velocity—ultimately elevating customer service.

 

Eliminating Re-Work from Dropped Connections

Many warehouses require workers to handle inventory in locations where Wi-Fi and cellular connectivity are poor or nonexistent. When connections drop, employees can lose several pallets’ worth of collected data. Hours must be spent to re-scan that material. This impacts inventory accuracy and productivity.

In one use case, workers at CyberCore Technologies were facing challenges from lost data during connection drops:

“We were literally doing 30% of our work twice,” said Frank Goodwin, Logistics Manager for CyberCore. CyberCore solved this issue by implementing RFgen’s offline mobile data collection solution. Now, scanned data is automatically stored on the handheld device. Information never gets lost when a connection drops or when team members scan barcodes while off-network.

“Even if a connection fails, you can just hit resend,” said Goodwin. “You don’t have to do all the work again.”

CONTINUE READING: CyberCore gains whopping 99.999% accuracy and 450% efficiency »

 

The Order Picking Problem

Inefficiency Harms Employee Productivity

Mobile barcoding, with warehouse automation software, can decrease picking times, while increasing accuracy.
Mobile barcoding, with warehouse automation software, can decrease picking times while increasing accuracy.

As one of the most labor-intensive processes in warehouses, order picking amounts to 55% of operational expenses in any distribution center. Unfortunately, warehouse picking usually falls under logistics and often gets ignored by top decision-makers. To meet the demands of production and fulfillment, a streamlined picking strategy that emphasizes speediness, accuracy, and organization is necessary.

And yet, many warehouses struggle to get orders out on time, find themselves consistently undercut by competitors in fulfillment turnaround, and face regular complaints about order accuracy. For pickers, lack of ergonomics and too much backtracking add to issues.

Mobile apps for picking can mitigate many of these challenges. With mobile barcoding, for example, pickers can quickly locate items, process order lines, and update inventory levels in the ERP at maximum accuracy and efficiency.

 

Advanced Put-Away and Pick Routing

One of the primary benefits of mobile barcoding is the ability to add advanced WMS functionality for areas like put-away and picking.

Intelligent software can automatically suggest optimal put-away locations in receiving, and then instantly notify the ERP and connected mobile devices that those items are available for picking—instead of waiting days for someone to re-type that data into an office computer.

When orders are ready to be picked, the mobile software points pickers to items for the order. Workers are then routed down optimal paths, enabling picking for multiple orders at once, wave picking, and other types of picking methodologies without doubling back or risking collision with other team members, forklifts, or robots.

In one use case, Myers Tire Supply achieved directed movement and intelligent batch picking through RFgen Warehouse Director, empowering its distribution centers to fulfill their promise of same-day shipping.

 

Voice-Directed Order Picking Boosts Productivity

Another warehouse automation system involves voice technology. Voice picking allows warehouse employees to operate hands-free while processing inventory. Even minor efficiency improvements from voice picking in high-volume warehouses yield large increases in productivity and safety, adding significant value.

For instance, Caito Foods used voice picking to boost inventory accuracy by 25% and worker efficiency by 35%.

Watch the video below:

 

The Hidden Overhead Problem

Cost Bloat from Inefficiencies on Warehouse Floor

Some hidden inefficiencies may seem minor but the costs add up. Even a few extra steps add time to each task. When tasks are repeated hundreds or thousands of times per day, that seemingly small effort balloons into several days of wasted productivity for each employee every year.

Employees typically spend 60% of their time walking the warehouse floor to find items. Given the size of many warehouses and the number of items handled every year, that time could be used more efficiently.

Mobile technologies that run on handheld devices and extend ERP inventory functionality to point-of-scan have proven highly effective in removing unnecessary wait-and-walk time—thus creating significant value.

 

Bulk Moves Eliminate Repetitive Work

Another hidden source of value creation can be found in grouping inventory transactions with warehouse mobile apps. For example, bin swaps can be greatly simplified. Instead of scanning each item, inventory can be quickly transferred between bins in a bulk move—either inside the warehouse or between locations—in just a few seconds.

Chris Lorentz, Business System Analyst for Insitu Inc., called this innovation “a truly labor-saving transaction.”

READ THE SUCCESS STORY: Aircraft manufacturer Insitu lands in a new world of efficiency »

License plating provides similar capabilities.

With license plating, inventory can be grouped together so workers can scan the license plate barcode to transact the group all at once. Employees can quickly and painlessly group, store, locate, and transfer sets of similar or mixed products (such as a pallet) without having to scan items individually.

LEARN MORE: Accelerate warehouse velocity with license plating solutions »

 

Shorten Cash Cycles with Direct Store Delivery (DSD)

There is also value in automating delivery processes in the field, such as with electronic proof of delivery and Direct Store Delivery (DSD).

Without DSD, the time delay between physical receipt of goods and manual verification of the delivery can often be 3-5 days, resulting in loss of value. Additionally, the end-customer or the receiving store could claim the item was either defective or damaged during shipping, hoping to get a discount or refund.

To prevent false claims or reduce costs from lost or damaged inventory, technologies like DSD are needed to prove undamaged delivery.

With DSD mobile apps, delivery drivers in the field can capture product photos and signature confirmations upon delivery. If the delivery is canceled or proof could not be obtained, an email informing of the item’s return will automatically be sent to the warehouse.

In this way, mobile field services software shortens the account receivables cycle with instant delivery confirmations and faster invoicing, in turn reducing loan carrying costs and creating value.

 

The Warehouse Safety Problem

Safety Incidents Hurt Productivity and Increase Costs

 

Voice-recognition-devices-enable-handsfree-eyesfree-workflows
Voice-directed picking is one way to improve workplace ergonomics and provide workers with a safer working environment.

The supply chain already faces major challenges in retaining employees. Losing workers to preventable injuries adds more stress when already short-staffed.

Common injuries tend to be minor, ranging from falls, to muscle pulls, to back strains from repetitive movements. The U.S. Bureau of Labor Statistics (BLS) reveals injury rates among warehouse employees to be roughly 5%.

That may not sound like much, but with each incident, insurance premiums go up and workforce morale suffers, leading to lower productivity and increased turnover.

As far as cost, the National Safety Council estimates that for every $1,000 in direct costs to a company as the result of an employee injury, there are at least $5,000 in indirect costs, often more. A single injury can easily require $60,000 or more in revenue to cover associated losses.

In strictly regulated industries, such as oil and gas or pharmaceuticals, the true cost of an accident claim resulting in serious injury can exceed $1,000,000.

Mobile barcoding with long-range scanning capabilities can help. With point-of-work mobility, workers are less likely to get injured because they don’t have to walk as much, make fewer awkward and repetitive movements, and avoid unsafe behaviors like climbing and over-reaching.

Voice-directed picking further enhances workplace ergonomics by reducing the need for split-focus activities and distractions.

In this way, the right warehouse technology makes your employees feel safer and more confident, and that their company cares about their well-being. The result is increased overall tenure and greater motivation for employees to go the extra mile.

ALSO READ: Turn labor challenges into labor opportunities with tech »

 

Choosing New Warehouse Automation Software

Even when the benefits of new warehouse automation software are apparent, many supply chain and IT professionals hesitate. This is understandable. A few things to consider:

  • Uncertainty about ROI: Budgets are often squeezed, not allowing for new technology purchases. However, for short-ROI technologies like mobile data collection, the cost of inaction far outweigh the price tag.
  • Weight and fit of solution: Implementing overly complex technologies can easily overburden your operations. Look for a flexible solution that is fast to implement, requires few resources to maintain, and can be delivered as part of an all-in-one package—hardware, software, and services.
  • Cultural resistance to change: Veteran employees may be resistant to new solutions because “this is how we’ve always done it.” But even the strongest skeptics can be convinced. An intuitive mobile solution that’s simple to learn and easy to use is essential to ensure user adoption.
  • Maintaining ongoing operations without interruption: The last thing any technology buyer wants is to impede crucial operations during the implementation process. To avoid integration headaches, consider mobile solutions with seamless, certified, and field-proven compatibility with multiple ERPs to ensure a clean rollout.
  • Future scalability: Warehouse inventory software should be scalable across locations, divisions, and countries while retaining the ability to tailor operations to each facility. Systematizing your business processes creates a blueprint that empowers your organization to replicate success and grow.

 

Fast Value Creation With Mobile Barcoding

Introducing new technologies in your warehouse can be confusing, complicated, and overwhelming. You must find solutions that fit your budget and offer short ROI to help drive new levels of profitability.

Warehouses that resist automation will continue to suffer from shrinking margins, bloated overhead costs, sluggish response times to changing market conditions, inability to meet growth targets, and financial risk due to inaccuracy or noncompliance, the impact of which may be passed onto customers.

Mobile barcoding can drastically increase warehouse efficiencies with immediate benefits. RFgen barcode software extends your ERP to point-of-scan, eliminates manual processes and bottlenecks, and provides a quick path to ROI.

RFgen Software’s team of experienced experts understands the challenges you face. They can help you get the most out of your mobile solution investment to realize positive returns in months instead of years.

Start creating value with a new mobile warehouse solution today.