Undoubtedly, software applications are the best key factors to bring success in the business with a good range of productivity and profitability. If you go for inventory management, wholesale & distribution, fast-moving consumer goods or supply chain, the best thing from your side is to get in touch with Enterprise Resource Planning (ERP) or Warehouse Management System (WMS).
It is good to know that both the applications have similarities and they also have their unique features. As a result, each one carries a specialty that varies from business to business. For the right choice of software using, you should go for ERP vs WMS.
What is ERP System?
ERP comes as an integrated business management process and it stands for Enterprise Resource Planning.
This software works for performing collaboration, automation, streamlining in the organization. It works on all the involved data from different departments and acts as a centralized repository. This one goes for collection, storing, managing, interpreting the collected data from the department and then performs report building and dashboard generation. But if someone suggests you either ERP or WMS, you should go for WMS ERP difference.
Advantage of ERP System
- Savings on time, money, and efforts.
- Traceability
- Developed clients satisfaction with productivity
- Augmented cash flow and business reporting
- Improved costs regarding inventory
- Better cloud-based data & security
- Business process enhancements
- Management for supply chain
See also: What are the Primary Business Benefits of an ERP system
What is WMS?
Warehouse Management System is software designed to give support and optimize warehouse functionality with distribution center management. This one especially caters to the report of day-to-day activities of the warehouse and gain insights into the information stored in it. It works in enhancing visibility with the inventory processes and provides the best and most accurate results into the different warehouse operations. WMS helps the manufacturers by offering an effective inventory movement in the entire chain. It brings a solution for stock items, packed, shipped utilization for barcode scanners, and many more.
This application works alone and caters to specific business requirements. It comes ahead to adhere to the other parts of functionalities in an enterprise. WMS involves the function of picking, packing, shipping of items, receiving, reporting, and others.
Benefits of WMS
The benefits of WMS carry vital importance when you come to check WMS ERP differences. To know the benefits, just look at the below points.
- It brings the best of space utilization & lesser operating costs.
- WMS provides transparency in inventory management.
- It is good for labor management.
- WMS optimizes travel time, internal operations, and supply chain.
- This one brings easy tracking of inventory materials including good stock control.
- It runs with leveraging automation benefits
- Good for faster turnover of inventory
What is the difference between ERP and WMS?
Most of the time, business organizers feel confused whether ERP & WMS are the same or they are different. Though certain companies may think common to both but overall, they are two different business solutions.
WMS is an effective system that requires support from other software but ERP is a complete solution. Unlike WMS, ERP solution does not come for optimization based on real-time information and cannot generate historical reports as well as data that identify the location in need of stock each item.
Key features that describe WMS ERP difference
WMS is an effective system that requires support from other software but ERP is a complete solution. Unlike WMS, ERP solution does not come for optimization based on real-time information and cannot generate historical reports as well as data that identify the location in need of stock each item.
- Flexibility – Older ERP system is perfect for transaction-based logic and they are suitable for linear environments with chronological operation including limited expectation. Suppose if your business comes vulnerable to constant priority changes, you should for the best option WMS that works to focus on the real-time operation or ERP system.
- Product Tracking – It is good to know that some ERP systems are also not through in-depth product tracking. If the supply chain comes too complex, you may need the improved functionality of WMS.
ERP vs WMS – Explained
The different features come to intersect from one to another. Come to understand the differences of WMS vs ERP with a table.
| Enterprise Resource Planning (ERP) | Warehouse Management System(WMS) |
| Integration in all departments of supply chain provides a good flow of information. | Warehouse operations with smooth information go within the supply chain. |
| Used in larger scale | Used in a specific scale |
| All in one system | Standalone system |
| A good flow of information with multiple departments via software | Real-time information of picking up, packing and goods delivery |
| Manages the entire process from processing raw materials to shipment of the product, cost calculation, and overhead costs | Manages warehouse deliveries including inbound and outbound, sales receipts, goods pick, return and delivery schedules. |
| ERP becomes tough to implement as it involves multiple departments with users. | WMS becomes easier to implement as it caters to a focused audience. |
| ERP talks about other systems and provides a well-defined inter-department. | WMS requires a separate network to talk to third-party system. |
| Best for several manufacturing business organizations. | Best for different inventory movements, warehouses and real-time stock updates. |
| It is easy to scale, modular design and downscale as needed. | Difficult in scaling requirements. |
| ERP is designed with multiple applications. | WMS is designed with single application for multiple warehouses. |
| ERP is not a part of WMS. | WMS can be a part of ERP |
| This one comes costly because of multiple modules. | It is affordable as it focuses only scope. |
| ERP does need much integration. | WMS may need a third party integration. |
The Pros & Cons of ERP vs WMS
Pros of ERP
- Helps you to streamline the entire business
- All-in-one solution for the entire business.
- Easily scalable and the software is designed to upscale with more products.
- Provides centralized solution to get access to business information.
Cons of ERP
- Very expensive because of the company’s growth and implementation.
- Static and very difficult to change business goals.
- Less sophisticated and poor insight of warehouse health.
Pros of WMS
- Fit for a specific purpose to increase productivity and profitability.
- End to end warehouse management solution
- Takes 6 to 8 months for implementation
- Includes advanced features like waving, cycle moving, labor, and automation.
- Facilities for integration in to ERP
Cons of WMS
- Can isolate warehouse from other departments.
- Difficult to integrate WWS solutions
- Requires implementation for change management
Which is better for business between ERP and WMS?
As a businessman, you may have a question about either ERP or WMS fit. Through an example, you can understand better. It is just like choosing a car that is perfect for your purpose. You need to select first your requirement and think about how you come to intend to use the software in need of supporting your business goat. When you come to understand completely your needs, you will easily weigh up the benefits of each system.
But if you do not determine your supply chain goals according to your business demand, you should come first for understanding from your initiative. Once you get the complete requirement, you can easily justify either ERP or WMS required.
Do you need which one out of ERP and WMS systems?
The answer completely depends on the responding person that may be CFO. According to the studies, the capability of warehouse management gets complete facilities with ERP solutions for small and mid-size distributors. Generally, low order volumes and simple processes can perform warehouse management like receiving, picking, packing & shipping. But WMS is not the right for distributors or mid-size businesses. With some examples, you can come to have a better understanding. Just look at the below details.
What do the organizers need WMS or ERP in case of barcode scanners?
Not necessary, generally, barcode scanning is a common component of a WMS. In that case, you should go for another feature. In that case, you can go for produmex Scan, a simple warehouse scanning solution. It is the best way to implement warehouse scanning without a separate WMS.
Which system is perfect for the warehouse team?
Generally, it depends on your goal and the requirements you have. It is good to know that an integrated WMS comes with a lower cost for the warehouse team with the ERP system. That means, if people need to update inventory data, WMS is the right one. On the other hand, if the users require wider visibility into other operational data, ERP is the best.
Conclusion
Both the systems, ERP – WMS, are essential components in supply chain management in need of assistance for an organization just to handle their stock effectively. They provide information based on real-time data in several ways and come to be kept on a cloud-based server. Each of the systems is designed with its price ranging from a thousand dollars to hundreds of thousand dollars. Every warehouse does not need a WMS as they are complicated as well as they require a high price. There are a lot of levels of inventory processes and each one is essential for a company depending on its demands.
