Virginie Taborowski
Content Specialist
Last updated on
24.9.24
Best Practice
Digitize warehouse: Optimizing warehouse management through digital processes
8
min
Table of contents
- What does digitizing the warehouse mean?
- Digital warehouse management: These are the benefits
- How does warehouse management work digitally?
- The disadvantages of analog logistics
- Best practices: These companies are setting a good example
- Five tips for your digital warehouse
- Conclusion: Future-proof through digital warehouse processes
In view of growing supply chain requirements and increasing customer expectations, it is becoming increasingly important for companies to digitize their warehouse. By transforming from analog to digital warehouse management, companies benefit from more efficient processes, reduced costs and improved transparency in their inventories.
In this article, we will show you the other benefits of digital warehouse management and how you can successfully implement the change as a company.
What does digitizing the warehouse mean?
The digitization of the warehouse (also: digital warehouse) means the conversion of analog and manual warehouse processes to digital, automated processes. Modern technologies such as warehouse management systems (WMS), RFID and barcode technologies, and the Internet of Things (IoT) are used for implementation.
Traditional warehouse processes are often characterized by manual inventories, paper-based documentation and a high risk of errors. Through the digital warehouse, Automatically records and manages inventories — through mobile scanner devices, for example. This is how companies can access your inventory data in real time and Respond faster to changes. If a product is no longer available, it is automatically reordered as soon as inventory approaches zero thanks to warehouse management software.
Digital warehouse management: These are the benefits
Digital warehouse management offers a variety of benefits that go far beyond mere automation. Key benefits include:
- Increasing efficiency: Automating processes — such as inventory management or order processing — speeds up warehouse processes and ensures optimal use of resources when you digitize your warehouse.
- Cost reduction: Precise inventory management results in lower inventory levels and thus also reduces storage costs. The result: Superfluous stocks are avoided and storage space can be better used.
- transparency: Real-time data provides an immediate overview of inventories, orders, and deliveries. This not only promotes internal control, but also traceability along the entire supply chain.
- error reduction: When companies digitize their warehouses, manual entry errors are removed from the agenda. Automated systems detect irregularities early on and thus prevent major problems.
- sustainability: By reducing paper consumption and optimising the use of resources, digital warehouse management contributes to sustainability. As a result, companies are also positioning themselves as modern and environmentally conscious partners with their customers.
- customer satisfaction: Faster response times and improved delivery accuracy result in higher customer satisfaction. Today, no company can do without punctual deliveries and reliable inventory information if it wants to keep up with the competition.
How does warehouse management work digitally?
The warehouse is digitized by Use of various technologies and software solutionsthat work together in an integrated system. First, a warehouse management software implemented as central control element serves. The software coordinates all warehouse processes, from incoming goods control to inventory management and shipping.
A digitized warehouse process could look as follows: When goods are received, every incoming item is recorded using RFID tags or barcodes and automatically posted to the system. The warehouse management software now calculates the optimal storage location for the goods and controls storage.
When a customer order is placed, the inventory is checked in real time, picking is automatically triggered and the shipping process is initiated. Depending on the volume of orders, the warehouse management software automatically calculates the quantity and frequency of reorders.
Important components of warehouse digitization:
- software solutions: Warehouse management software enables central control and monitoring of all warehouse processes. It is at the heart of the digital warehouse and offers functions such as inventory management, order processing and reporting.
- hardware integration: The use of barcode scanners, RFID technology, and IoT devices ensures seamless data collection and transmission. The devices are connected directly to warehouse management software and therefore enable real-time monitoring of inventory levels when you digitize your warehouse.
- Automated processes: Digitalization can automate many of the warehouse processes — for example by automatically reordering goods or optimising order picking processes.
The disadvantages of analog logistics
The disadvantages of traditional, analog logistics are manifold and have a significant impact on a company's efficiency and competitiveness. This includes:
- Manual processes: Manual processes are not only time-consuming but also prone to errors. Incorrect entry or overlooking inventory changes can lead to significant problems, such as delivery delays or incorrect deliveries.
- Lack of transparency: Without real-time data, it's difficult to keep track of inventory levels. This often leads to excessive safety stocks, which unnecessarily drive up storage costs.
- High paper consumption: Traditional warehouse processes require a variety of paper documents, which are not only confusing but also polluting the environment.
- Poor scalability: While digital systems can easily keep up with a company's growth, analog processes quickly reach their limits as the warehouse grows in size and complexity.
Best practices: These companies are setting a good example
Numerous companies have already successfully made the transition to digital warehouse management and today serve as impressive examples of other companies that want to embark on this path. We will show you three companies that have successfully digitized their warehouse and are thus setting the best example.
Zalando
One outstanding example is online fashion retailer Zalando, which uses fully digitalized warehouse logistics. Thanks to advanced technologies, Zalando is able to efficiently manage millions of items and deliver them to its customers in the shortest possible time.
Digitalization enables the online shop to achieve exceptional speed and precision in processing its orders. This sets e-commerce apart from the competition and strengthens its competitiveness.
Amazon
Another role model is the world's largest online retailer Amazon, which is setting new standards in digital warehouse management with its highly automated warehouses. In these warehouses, robots take on a large part of the picking tasks, which not only significantly increases efficiency but also speed.
Amazon's use of automation technologies has put the company at the forefront of logistics innovation and enables it to deliver on the promise of ultra-fast delivery times.
BMW
BMW is also impressively showing what advanced warehouse management can look like in practice once the warehouse has been digitized. The renowned automotive manufacturer uses a highly networked warehouse management system, which enables it to precisely control just-in-time deliveries in production.
Digitized processes ensure that the required parts are available in production at exactly the right time, optimising the efficiency of the entire supply chain.
Five tips for your digital warehouse
Digitalizing your warehouse can feel like a big, exciting adventure. In reality, however, it only requires careful planning and thoughtful steps. In order to overcome the challenges and take full advantage of modern technologies, it is crucial to proceed with care.
Below are five valuable tips to help you digitize your warehouse while ensuring that your investments deliver maximum return.
- Start small: Start with a pilot project to test digitization in a manageable area.
- Train your employees: Comprehensive staff training is crucial for the successful use of digital technologies.
- Choose the right software: Make sure that the warehouse management software you choose is intuitive and adaptable. Low-code systems such as Ninox can be tailored to meet your individual needs.
- Invest in the right hardware: Barcode scanners, RFID readers and mobile devices are essential for efficient warehouse management.
- Continuously monitor and optimize: Review your digital processes regularly and adapt them to new requirements.
Conclusion: Future-proof through digital warehouse processes
Digitalizing warehouse management is more than just a trend — it's a necessity to remain competitive in today's fast-paced business world. By using digital technologies, companies can increase efficiency, reduce costs and increase customer satisfaction. While switching from analog to digital processes requires initial investment and careful planning, the long-term benefits far outweigh the long-term benefits. Companies that successfully take this step are positioning themselves for the future and securing a decisive competitive advantage.
