Warehouse Management Systems (WMS) have been around for over a decade and are well-entrenched as the workhorses of the warehouse.
However, industry experts say that the industry is in the midst of a new cycle that is seeing major changes occurring to WMS and what they're used for.
"One thing that's happening is an expansion of WMS into other areas of the organization, primarily around manufacturing and traceability of raw materials into finished goods," says Michael Farlekas, vice president of sales for the Americas for RedPrairie Corp., Waukesha WI.
Farlekas says that today's food companies need WMS systems that are more flexible than ever and are able to understand the entire scope of the production process, from production and manufacturing, down to the lot level itself.
"We're seeing a trend toward the adoption of WMS. It's being driven on the beverage side by increased levels of SKUs as marketing departments are introducing new kinds of energy drinks and different flavors," notes Chad Collins, vice president of global strategy for HighJump Software, Eden Prairie, MN. "The beverage companies are now looking to WMS to deal with this added complexity."
One example is City Brewing Co. LLC, a La Crosse, WI-based maker of tea, energy drinks and beer.
"We have up to 60,000 inventory transactions a month. We have 700 finished product SKUs and we have contracts with 35 beverage companies that each handle things a little bit differently," says Pat Sake, the brewer's warehouse manager.
With this challenge going on daily, the company needed a way to make sense of it all and at the same time keep a tight rein on costs, due to the low margins in the industry.
The company introduced a warehouse management system from HighJump Software, which features a bar code scanning system, with onboard computers on its lift fork trucks that are used for scanning finished product.
"Once the products are made, put into the bottles, palletized and sent into the warehouse area, we apply a pallet tag with a bar code on it," explains Sake.
When the forklift operators scan the tag, the WMS automatically removes the components that went into product on the pallet-the cartons, cans, ingredients, labels, caps, crowns-all of these are removed from warehouse inventory by a simple scan. The pallet is also put into City Brewing's full goods inventory. The company ends up with real-time records that reflect raw material used and finished product produced.
"Not only do we track all that inventory, but it allows us to adhere to a strict FIFO (first in first out) process and also allows us to meet our customers' reporting and recording requirements," says Sake. "All of the required reports for the FDA, for federal tax requirements and more, are all easily tracked and met with our system."
In addition, customer audits were also made easier. With the prior system, City Brewing's customers would have to come in on a monthly, quarterly and year-end basis and do physical count audits. "Now the bulk of them don't even come in," Sake says. "They know our counts are accurate."
Supply Chain Optimization
"More companies are trying to optimize their supply chains. As they become more familiar with what a WMS does and how it can optimize what's going on within their four walls, they're looking out across the ecosystem of the food supply chain and how they touch the different pieces of it," notes Scott Gillies, account executive, food industry, for Manhattan Associates Inc., Atlanta.
Geest PLC, one of the leading fresh prepared foods and produce manufacturers in the UK, has multiple production sites. Over the past few years, Geest has had great success in marketing its products, which has resulted in stellar growth for the company, going from sales of 664 million pounds to a projected 1 billion pounds in just a few short years.
However, rapid growth was presenting a challenge to the company's systems and network of facilities, which included six companies that fed into seven different warehouses.