Warehouse management systems have similar powers to Hermione Granger from the Harry Potter universe — they’re efficient, organized and great at storing and pulling up information. But to get the best out of your WMS software, you need the right features.

To help you find the perfect match, we’ve created a checklist of critical warehouse management system features to help you decide what your company needs.

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WMS software features provide an overarching “facility, packages and people” approach to warehouse operations. These tools manage several steps of the supply chain management process, including everything from shipping to employee scheduling.

They also integrate various types of analytics and business intelligence. Company leaders can use this valuable data to help fine-tune or revamp their warehouse operations (or entire supply chain).

Data visibility is key to achieving a fully optimized warehousing operation; ensure these tools are part of your warehouse management system requirements!

What This Article Covers:

• Features and Requirements
  • Inventory Management
  • Cartonization
  • Warehouse Automation
  • Labor Management
  • Order Picking
  • Putaway
  • Reports and Analytics
  • Returns Management
  • Order and Billing Management
  • Shipping
  • Yard Management and Receiving
• Warehousing Functions
• Primary Benefits
• Best Practices
• How To Evaluate the Right Software
• FAQs
• Next Steps

Key Features and Requirements

Some warehouse management solutions look a lot like inventory management software. However, they mostly focus on warehouse management’s physical and logistical aspects. When considering a WMS, keep your business’s unique warehouse management system functional requirements in mind and include the features you need.

Keeping your WMS requirements and functionality checklist on hand when selecting a solution can also help keep must-have features from slipping through the cracks. Here are some warehouse management software features to consider:

1. Inventory Management

Inventory management is one of the most significant warehouse management system features. It’s a must-have to maintain inventory levels. Some major components of robust inventory management include inventory visibility, forecasting, purchasing history, tracking, analysis and accounting.

At some point in time, manually handling your inventory isn’t going to work. Some operations can get out of control while processing multiple orders from different sales channels and checking stocks across different platforms.

Experts warn about solely depending on full inventories and ignoring regular cycle counting. Lilia Tovbin, CEO & Founder of BigMailer.io, told SelectHub:

Regularly check inventory accuracy with the warehouse management system. Don’t rely solely on occasional full inventories. Instead, implement regular cycle counting with the software to allow for more targeted checks and catch discrepancies in real time. Doing so streamlines the inventory management process and helps prevent stockouts or overstock situations.”

For warehouses handling specialized types of products and materials, warehouse management solutions often include specific inventory management tools such as perishable goods tracking and FIFO/LIFO protocols. These protocols, properly backed up by digital planning tools, keep products fresh and decrease waste.

Having a good inventory management system benefits a warehouse in many ways. It improves customer experiences and cash flow, optimizes fulfillment and prevents shrinkage. Make sure to watch out for these warehouse management software features:

• Barcode Scanning
• Cross Docking
• Cycle Counting
• Inventory Reordering
• De-Kitting
• Physical Inventory Count
• Rules Engine
• Slotting Techniques
• Task Interleaving

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2. Cartonization

Evaluate items based on the number and size of cartons. Select standalone applications or modules that are part of an enterprise resource planning (ERP) or warehouse management system to manage cartonization. It’s best used in warehouses that involve multiple distribution operations.

Algorithms analyze the best way to pack cartons and minimize labor costs. They select items according to weight, height, width and length for efficient packing. Besides analysis, this feature also improves traditional shipping methods via automation.

With cartonization, warehouses can run their distribution operations efficiently while reducing overall shipping costs. However, there are certain factors to watch out for when choosing containers or cartons before shipping.

1. Item Type: For example, you probably shouldn’t ship food and cleaning items in the same container.
2. Size: Determine whether the order should go in a single package or split into two smaller boxes.
3. Shape and Nature: Pointed items might compromise packaging, while heavier ones might damage smaller and lighter objects.

Make sure you select a WMS that includes these features as well:

• Container Loading
• Packing Workbench
• Single Level Cartonization
• Container Splitting
• Multi-Level Cartonization
• Container Management

3. Warehouse Automation

One of the key factors fueling significant industry growth is warehouse automation. It offers numerous benefits, including enhanced productivity, minimized labor risks, reduced human error, increased efficiency and better accuracy.

As automation integration continues to rise in popularity, warehouse managers can do away with time-intensive manual tasks. Speaking of automation, incorporating robotics, AI and machine learning into warehouse management systems can drastically increase efficiency and speed. Picking robots can find and transport materials without requiring employees to run back and forth from products to shipping areas.

Diana Zheng, Head of Marketing at Stallion Express, told us:

Automation is a game-changer. Select software that seamlessly integrates with automation technologies such as robotics or conveyor systems. Not only does automation increase productivity, but it also reduces the risk of human error in repetitive processes.”

With autonomous mobile robots (AMRs) taking over non-productive walking times, automation significantly improves efficiency and productivity. AMRs aren’t just for large organizations; even smaller companies can deploy them for scalability and flexibility.

Implementing AMRs or automated storage and retrieval systems (ASRs) with an automated warehouse system can significantly improve overall processes. These modern technologies facilitate accuracy and safer operations, from tripling order fulfillment productivity to faster deployment and improved picking accuracy.

An automated warehouse system can automate multiple repetitive tasks like inventory management, picking and packing, back-office management and more. Although most WMSs offer basic features, you’ll need to dive deep into solutions that comply with your warehouse management system requirements to ensure they offer the right tools, like:

• Pick-To-Light
• Automated Storage and Retrieval
• Warehouse Simulation
• Maintenance and Inspection

With the rise in the adoption of robot technology, it should come as no surprise that the warehouse automation market size is expected to reach $54.59 billion by 2030. Integrating the right warehouse management system requirements and innovative technologies can solidify a competitive edge.

4. Labor Management

Apart from the many unique features that identify and monitor physical materials and packages, other warehouse management software features include labor management. Proper labor management can keep employees on task and discover processes that waste valuable resources. Employees can maintain online attendance using QR or pin codes to track timing.

These features also give employees a way to track hours, look at paid time off and see how much overtime they have.

Workforce planning software has come a long way in just a few years. Most companies use enterprise automation as part of their warehousing solution by integrating labor management systems with robust WMS platforms. Labor management tools can identify staff and maintain schedules while matching individual staff members to tasks.

The labor side of the equation is critically important to ensure vital warehouse management functions happen as planned. Make sure to check for these features in the warehouse management system you choose:

• Labor Planning and Scheduling
• Warehouse Safety Control
• Labor Allocation
• Employee Engagement
• Labor Cost Optimization

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5. Order Picking

Order picking is time-consuming and takes up over half of picking operation costs. While warehouse order picking is crucial for smooth order-fulfillment processes, selecting the right picking method is vital.

Picking isn’t something you can manage through purely manual means. There’s a lot of activity involved, like receiving and storing inventory, moving items across the warehouse and picking orders for shipments. All of these operations are important. If one falters, the entire supply chain can suffer.

The benefits of obtaining the right warehouse order picking system include reduced warehouse costs, improved customer satisfaction and better accuracy.

Selecting the right warehouse management software features can be challenging without guidance. Check out popular vendors like Manhattan Supply Chain, SAP Warehouse Management and Logiwa when looking for:

• Batch and Cluster Picking
• Partial Picking
• Directed Voice Picking
• Vision Picking
• Zone Picking
• Wave Picking

6. Putaway

Most warehouse managers define putaway as an inefficient warehouse process. However, this isn’t true. Strong putaway is necessary to increase efficiency and optimize warehouse operations. This process starts when the warehouse receives and stores items in the right location.

Proper putaway reduces the chances of misplaced items, speeds up picking processes and leads pickers to the correct storage location.

There are four putaway methods to choose from according to the product type, SKUs, purchase order and storage location. Selecting a system that supports different kinds of putaway is a game changer. Look out for a system that offers:

• Putaway Rules
• System Directed Putaway
• Bin Search Rules for Bin Selection
• Putaway Zone List

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7. Reports and Analytics

Many of the best warehouse management solutions provide features that aggregate business intelligence from warehouse operations. Real-time tracking is a major asset, particularly in maintaining inventory. It lets you view inventory levels in real time to track when you’re low on certain items or if you have more stock than necessary.

Zheng, while highlighting the importance of data, said:

There’s a saying that says, “Data is power.” Your software should be able to analyze key performance indicators (KPIs) for you so that you can make informed decisions. For example, you can analyze your inventory turnover, order fulfillment rate and employee productivity.”

Other tools may filter data for KPI analysis and highlight improvement areas. Workflow management tools identify what’s happening within a warehouse and areas that require attention. Collecting high-quality data helps decision-makers change key business processes while also helping them prepare for the future.

Adrian Wade, Head of Supply Chain at BlueSky Solutions, commented on how reporting and analytics help make better decisions:

The reporting capabilities of warehouse management software are extremely useful as it can give insight into patterns that should be focussed on, whether that be positive things such as popular items for forecasting future orders, or areas that need to be improved if a bottleneck is created in any area of the business.”

In addition, many of the premier warehouse management software vendors offer multi-location tracking to work with multiple warehouses. Language, tax and multi-currency features are important for businesses that operate globally.

Keep an eye out for these helpful features:

• Inventory Analytics
• Consignment Reports
• Performance Metrics
• Total Landed Cost
• Procurement Analytics
• Discrepancy Reports
• Replenishment Planning Analytics

8. Returns Management

Managing product returns is something every warehouse wants to avoid. Though it’s a lengthy process, prioritizing returns management eventually boosts customer satisfaction and is integral to maintaining a healthy supply chain.

Most companies prefer to partner with a third-party logistics provider (3PL) to manage and handle product returns. The only downside of partnering with 3PLs is the upfront costs. Another option could be using robust warehouse management systems to control your supply chain and handle fulfillment processes, including returns.

With a WMS, you can automate and streamline these processes at every step: creating returns, updating stocks, generating reports, or issuing partial and full refunds. Check out the below warehouse management software features:

• Refund Management
• Returns Processing
• Returned Products Management
• Real-Time Returns Status Tracking

9. Order and Billing Management

A WMS can enhance order management by controlling the flow of products through your warehouse. Reorder features allow you to order parts or products that need to be re-supplied automatically.

Billing management tracks and captures client metrics like costs and billable services across multiple levels. This information includes cost data across activities such as inbound and outbound logistics, receiving, distribution and warehousing.

Look for some of these key features when selecting a warehouse management system:

• Order History
• Multichannel Orders
• Snapshot Management
• Wholesale Orders
• Activity-Based Billing
• Order Lifecycle Management

10. Shipping

Shipping is a core function that all WMSs must support. You’ll also find specific features like transportation management systems (TMS) that optimize shipments, handle planning and strengthen execution to improve shipping efficiency.

A broader goal of efficient shipping management is boosting customer satisfaction, reducing costs and gaining real-time visibility. While most systems support multimodal and intermodal transportation, others focus on a single mode of transportation.

However, for a TMS to work efficiently, users need to integrate it with a WMS. TMS software can directly affect and improve warehouse management as an integral part of supply chain management. It helps manage multiple tasks simultaneously, including labor scheduling, load building, cross-docking and goods palletization.

If you’re looking for transport management functionalities built into a WMS solution, here are a few to keep in mind:

• Freight Procurement
• Cold Chain Management
• Goods Check-in
• Picking and Putaway
• Packing and Dispatch
• Goods Arrival
• Digital Assistants
• IoT Fleet Monitoring
• Default Carriers and Services

11. Yard Management and Receiving

Yard management and receiving are essential WMS requirements that focus on managing the efficient flow of inbound goods into the warehouse. This process involves tracking, organizing, and optimizing vehicle and asset movement within the yard.

Yard management tools help schedule truck appointments for inbound shipments and manage dock door allocation and resource planning based on receiving personnel and equipment availability.

On the other hand, receiving involves accepting, inspecting and recording inbound shipments. The major goal is streamlining the receiving process to ensure accurate and efficient goods handling.

Suppliers can send electronic ASN notifications before the actual arrival of goods. ASNs provide essential shipment information (contents, quantities and expected delivery dates). The WMS can automatically match the ASN with the shipment, enabling efficient cross-referencing and verification.

• Appointment Scheduling
• Yard Visibility and Tracking
• Dock Management
• Gate Check-In/Check-Out
• Advanced Shipment Notifications (ASN)
• Receipt and Putaway
• Inventory Updates and Visibility

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Warehousing Functions

Warehousing is a critical aspect of a profitable and efficient business. It manages your inventory while maintaining and controlling items before they ship. Here’s a list of warehouse management functions that will solve business challenges and provide a systematic process to follow:

Storage

You need to clearly lay out your warehouse’s purpose, inventory, lifespan and storage space first. Keep items you don’t need immediately in storage and remove them as needed. This strategy reduces stock wastage and facilitates item safety.

Storage plays a critical role in warehouse management functions. For example, you’ll probably require additional storage during the holiday season and when goods sell at lower rates. You can remove these items from storage when prices increase or demand rises.

Risk Management

Items stored in warehouses probably have theft, fire or damage insurance. Although most warehouses minimize risks, installing surveillance systems to capture criminal activity and avoid product loss is advisable. Such systems can boost warehouse security by allowing managers to remotely monitor every activity in and around the warehouse.

Installing alarm systems and placing sensors in locations that need close monitoring will automatically send signals and notifications about potential break-ins.

Value-Added Services

Packing and grading are value-added services warehouses can offer on behalf of goods manufacturers or wholesalers. They include customization, re-packaging, re-branding, bundling and processing. Such services provide efficient product delivery, generate higher value and optimize the supply chain.

Barcode printing, stamping, labeling, invoice printing, order fulfillment, goods disposal and quality checks are other value-added services.

Price Stability

Maintaining a stabilized pricing option is another important aspect that warehouses control. They help manage price fluctuations by storing goods during excess market demand and releasing goods when demand is under control. This strategy lets warehouses ensure there’s enough inventory/goods to match supply and demand, leading to price stability.

Goods Movement

Upgraded infrastructure and robust warehouse management system features are key to moving goods smoothly in and around your warehouse. Goods movement includes inbound and outbound activity, order selection and storage transfer. These activities involve unloading goods, transferring them to the storage area and choosing items for shipping.

Thus, WMS software helps you solve challenges that are likely to happen in day-to-day operations.

Goods movement includes inbound and outbound activity, order selection and transfer to storage. This function is one major reason you should regularly use upgraded infrastructure and warehouse management system features.

Similarly, to run a successful business, you must consider choosing WMS software with features and requirements that best suit your needs.

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Primary Benefits

Apart from streamlining warehousing operations, warehouse management system features have some other benefits, such as:

Optimize Space and Inventory Visibility

Enhance operational efficiency by optimizing warehouse storage space and gaining visibility into your inventory status. You can minimize time wasted on loading and unloading and optimize the use of premium floor space. It helps streamline your processes, reduce costs and make better decisions.

Minimize Expenses

Excessive material movement, placement and retrieval consumes significant amounts of time and money. Implementing a WMS mitigates these problems, which can otherwise increase business expenses. You can also lower your expenditure by using the best storage locations.

Streamline Order Fulfillment and Customer Service

Businesses that can expedite orders well before the deadline have a clear edge in today’s competitive eCommerce marketplace. In a recent survey, 63% of consumers said they’dswitch retailers if they didn’t get deliveries in two days.

According to Wade:

In 2024, consumers expect their deliveries to be extremely fast, with deliveries taking over 3 days being considered slow. Without a warehouse management system, the manual processes involved would be extremely labor-intensive and push delivery dates well past one week. In a competitive market, this could result in consumers shopping elsewhere, unless the business could also offer an additional USP to make up for it (cheaper price, better quality, warranty, free returns, etc.).”

Therefore, competing with eCommerce giants like Amazon and Alibaba is only possible when you have a warehouse management solution that meets your order fulfillment requirements and boosts customer service.

Improve Labor Utilization

The platform lets you efficiently manage your workforce with labor forecasting, automated scheduling and streamlined work assignments. Automated item scanners at warehouse entry points mitigate the need for double-checking packages and allow workers to focus on crucial tasks.

Eliminate Errors

According to a study by F Curtis Barry and Company, the average cost of a fulfillment or shipping error is between $38.50 and $58.50. This is a significant amount that you can save by introducing automation through modern WMS to minimize the possibility of such errors.

You can also use barcode scanners and integrate them with other WMS features, allowing workers to scan product codes for instant verification. For example, if they pick item A for order B, scanning it will immediately generate an alert, indicating that the wrong product has been picked and providing the right product’s location details.

Achieve Comprehensive Management

Individually managing different warehouse modules isn’t practical. It’s time-consuming, prone to errors and costly. Integrating a warehouse management system with other solutions like eCommerce and CRM software can end this problem.

While explaining the benefits of integrating WMS with other software, Wade said:

For our business and, I imagine, all retailers, it is imperative that the system integrates with our eCommerce platform and CRM software. This makes the process from order to delivery much quicker and smoother, with orders being sent directly to the warehouse fulfillment / picking team as well as all the information being sent to the shipping departments to organize courier and logistics.”

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Best Practices

With a host of warehouse management tasks to keep track of, it can be easy to lose your way. Now that we’ve covered some vital warehouse management system requirements, let’s review some best practices. Even if you already have a running warehouse system, see if you can implement a few. The savings in time, work and money are well worth it.

Organize

An unorganized warehouse costs your company extra time and money when picking and shipping orders. Do you have a strategy for goods placement? Are multiple SKUs separated or in bins with one another? Another thing you can do to improve organization is to look at the warehouse’s floor plan and draw out common paths workers take when loading, picking or packing.

Do they end up retracing their steps? Are commonly picked items nearby, or do they have to walk the length of the warehouse? If you can eliminate some of that extra time finding items, that alone will improve your warehouse’s efficiency.

Check Again

Anything can go wrong in a warehouse, and that single error can cost your business big time. What if somebody writes eight instead of nine in a 10-lettered product name? What if one of the ordered products is displayed as available but isn’t? You can’t take the risk of delivering the wrong product! That’s why it’s important to double-check to ensure all numbers are correct, minimizing irregularities and downtime.

Regarding the importance of routinely checking inventory, Tovbin said:

Regularly check inventory accuracy with the warehouse management system. This involves using the software to compare the actual stock in the warehouse with the recorded data. When you make it a routine, you can ensure your inventory levels are correct, reduce errors and improve customer satisfaction.”

Avoid Manual Data Entry

Are you still writing SKUs on a notepad or entering them manually into a computer? The potential to mistype and the time needed to write or type each number by hand adds up to a lot of extra overhead.

Many products have barcodes or SKUs that a scanner can pick up. Scanning a barcode and having it automatically entered into the system is a lot more reliable than doing it by hand, and it will get products off the dock and into your system faster.

This idea goes for accounting tasks as well. Manually entering numerical data and doing calculations by hand is a recipe for disaster and a frustrated accounting team.

Ensure Operational Consistency

As your software runs through automation, you need to implement a well-thought-out operational structure that compliments the system most efficiently. You can’t achieve optimal software performance without operational consistency in your warehouse.

Gary Warner, Marketing Manager at Joloda Hydraroll, told us:

Automation works best for tasks that are regular, predictable and repetitive. If an operation changes from week to week or month to month, then a business may struggle to fit automation into its plan. Changes to inventory or layout would also require a reprogramming of the system.”

Warner also highlighted the importance of considering how employees will use the software before creating an operational roadmap:

For example, a lot of warehouse management software comes equipped with mobile features, which makes picking for orders and checking inventory more straightforward because employees can use scanners.”

Remember that without considering employee capabilities and your requirements, your business strategy may backfire. The software can only give you the best ROI if you evaluate and implement it correctly.

Prioritize Safety

Safety is of the utmost importance to anyone in warehouse operations management. Why? Aside from the obvious impact an injured employee faces, an accident on the job site can drastically harm an operation’s bottom line and affect your workplace’s reputation.

A safe warehouse is an efficient warehouse, so make sure to follow these guidelines laid out by Camcode, a leading barcode provider:

• Clear all aisles and remove spills immediately.
• Use safety equipment at all times, like eye protection and hard hats.
• Ensure emergency exits and sprinklers aren’t blocked.
• Provide appropriate ladders and train employees on which ladders are best for specific jobs.
• Have an emergency response plan.
• Post safety expectations in highly visible locations.

Train Employees

Employee training goes hand in hand with workplace safety. Injuries are more likely to occur if your employees aren’t up to date with warehouse procedures. To mitigate this risk, ensure only trained employees operate machines like forklifts or cranes. It’s also important for employees to renew necessary credentials ASAP.

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How To Evaluate WMS Software

At the end of the day, your team is only as good as its software. Make sure you do the proper research and take time to evaluate vendors and your own WMS requirements before implementing a warehouse operations management solution. Finding the best-fit software for your business can turn headaches into an efficient and optimized warehouse.

Consider a few of these questions when beginning your search for the perfect warehouse management system:

• How big is your operation?
• How much room is in the budget for a new system?
• Does your business prefer a cloud-based or on-premise solution?
• What are your must-have features?
• Is there time to train employees to use a new platform?

Jump into our free comparison report to measure top vendors against each other and find a solution that offers everything you need.

FAQs

What are the six primary areas that WMS covers?

The primary functions of warehouse management solutions are:

• Receiving
• Putaway and storage
• Packing
• Picking
• Shipping
• Returns

How many types of WMS are there?

Warehouse management systems can be primarily categorized into four categories:

• Supply chain execution models
• Stand-alone WMS
• Cloud-based WMS
• Integrated ERP systems

The supply chain execution model takes care of the entire supply chain, while stand-alone WMS operates on its own and doesn’t integrate with other solutions. Integrated ERP systems are connected with larger enterprise resource planning systems, and cloud-based systems are hosted in the cloud.

How to best manage a warehouse?

Effectively managing a warehouse requires a robust warehouse management system to streamline operations, reduce costs and mitigate errors. Some other best practices include training employees, organizing space, minimizing manual operations and prioritizing safety.

What is a pallet in WMS?

A pallet is a flat transport structure that can store boxes. You can find it in the transportation, warehousing, shipping and supply chain management industries. Pallets can help save storage space and reduce costs for your business.

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Next Steps

Warehouse management system features are a one-stop shop for everything a warehousing operation needs to succeed. Take your time when looking for that perfect solution, as one size definitely doesn’t fit all, and keep your unique WMS system requirements in mind.

Check out our free requirements template to identify and prioritize the features and modules that best fit your business needs.

What are some key warehouse management system features you can’t live without? Let us know with a comment!

SME Contributors

Adrian Wade has 19 years of experience in the B2B packaging sector. With a strategic mindset and an unwavering dedication to innovation, he stands at the forefront of BlueSky as the Head of Supply Chain. With a strong focus on product development and large-scale project management, he plays a crucial role in ensuring that from product conception to launch, every client need is met seamlessly.

Lilia Tovbin is the CEO & Founder of BigMailer.io, an email marketing platform for agencies and makers. She has extensive experience in the supply chain industry. She has worked extensively as a SaaS expert and is well-versed in warehouse management software.

Diana Zheng is the Head of Marketing at Stallion Express, Canada’s premier eCommerce and shipping company. She is a results-driven professional in the supply chain, warehousing, eCommerce and shipping industries. With a proven track record in revenue generation and relationship building, she has successfully empowered Canadian eCommerce sellers with comprehensive shipping solutions.

Gary Warner is the Marketing Manager at Joloda Hydraroll, the global partner for loading and unloading systems. He has a demonstrated history of working in a B2B environment and is skilled in business planning, sales, digital printing, the hospitality industry and event management.