Warehouse Management Systems


Inventory management systems (IMS) and warehouse management systems (WMS) are pretty similar. Both involve the monitoring of product levels through tracking skids and bins with barcodes, RFID tags, Bluetooth, or paper trails. In the past, the two terms have been used interchangeably. Nowadays, warehouse management systems have come to mean systems which are more involved and which handle tracking of more than just products. They often connect  connecting employees, management, and staff with equipment status, product locations, and inventory levels.  Innovative systems, like the one developed by Amazon, can track employee movements, equipment, and environmental conditions within the warehouse. Warehouse management systems often provide the precise location of all stock within warehouses, while inventory management systems are more product oriented and will tell management which warehouse a product and track financial information such as sales, mark-ups, and profit margins.

You may still find that some service providers and businesses use the two terms interchangeably. The rest of this article will focus on warehouse management systems since they provide a larger scope of exploration.


What are the needs of a warehouse?

A warehouse is a temporary place for inventory storage and acts as a buffer in supply chains, facilitating product movement between suppliers and customers. The specific needs of a warehouse depend on its function: as a storage center for raw materials, sub assemblies, finished goods, consolidation centers, cross-dock centers, sortation centers, or reverse logistic centers. Many warehouses perform a variety of these functions. Many warehouses have transformed into cross-dock and trans-shipment centres, consolidation points, and reverse logistic centers.

Amazon's Warehouse

A typical Amazon warehouse – this one from Koblenz, Germany.

The growth of e-commerce has forced warehouses to evolve and keep up with emerging technologies. Instead of thinking of warehouses as simply storage facilities, businesses are performing critical tasks at warehouses. Think of Amazon’s fulfillment centers and how they function as an entire ecosystem. Warehouse management systems face hurdles to implementation in fulfillment centers. As the market skyrockets, the systems need to be flexible.

A good system will reduce some of the major traditional trade-offs in warehouse management:

● cost versus service;
● storage capacity versus speed of retrieval;
● speed versus accuracy;
● lower inventory versus availability;
● efficiency versus responsiveness; and
● volume purchases versus storage cost and availability

By maximizing storage efficiency, automating tracking processes, and being able to better predict product demand, warehouses can go from being a cost sink into adding ROI to businesses. They achieve by weighing the initial cost of implementation with value of added efficiency, accuracy, and precision.


The future is cloud-based.

Tradition systems used servers which require maintenance and combinations of licenses and hardware. Modern systems use clouds to store data, making information retrievable from anywhere on any device. Cloud-based servers can operate in real-time and integrate with employee devices to eliminate dwell times. Order picking is among the most costly activities for warehousing operations, particularly in e-fulfillment warehouses which have a tremendous variety of stock for all seasons. These types of warehouses also deal with offering low-cost, bulky items which draw a consumer base but are cost-defeating in the long run.  typical order picking errors include omitting items, sending incorrect items, and sending the wrong number of items. Order pickers must also walk back to stations to receive their next set of instructions. It is difficult to automate these processes, but just this year, we have seen enormous leaps towards automation.


As the largest e-fulfillment center, Amazon is trailblazing with new tech.


Just last week, Amazon received a patent for a wristband which could overhaul their current warehouse management system. The wristband would allow communication between inventory storage bins, products, and workers.  the scale of Amazon operations steadily increase, the day to day inefficiencies within traditional warehouse management systems compound. The goal of the wristband is to eliminate ‘time consuming acts’ related to asset location and order fulfillment. The wristband works through ultrasonic sound pulses and radiowaves which facilitate communication between the wristband and nearby transducers on inventory bins. The wristband promises to take the guess work out of asset tracking and warehouse management by allowing software to track warehouse worker’s hand movements in relation to tagged inventory bins.
The wristbands can be calibrated to emit an ultrasonic pulse once per second and the strength of the received signal by the transducers would accurately track the location of employees throughout warehouses. If employees mistakenly place product in incorrect inventory bins, the interaction would be logged and corrective action could be taken.

Just because Amazon has patented their wristband does not mean other companies can’t take advantage of proximity technologies.


Proximity Technology and Warehouse Management Systems

Bluetooth and RFID are two dependable options for implementing real-time warehouse management. Similar to how Amazon has tagged employees with wristbands and bins with transducers, Bluetooth real-time location systems work through tagging personnel and products with Bluetooth tags which are then tracked through a deployment of Bluetooth-reading Gateways. An added benefit of a Bluetooth-facilitated system lies in the universality of Bluetooth hardware in smart devices such as phones, tablets, and laptops. Information on stock levels, new directions for order pickers, and ambient temperature or light readings can be accessed by anyone with the appropriate application.


Total Supply Chain Visibility

We live in an era called The Internet of Things in which devices are able to communicate with systems throughout expansive networks. 85% of the Best-in-Class companies have visibility into in-transit shipments status and rely exclusively on proximity technologies to track and log orders.

Total Supply Chain Visibility Allows Businesses to:

  • Predict, and therefore decrease, order failures
  • Reduce unnecessary reorders, which may lead to inventory write-offs
  • Optimize event management with suppliers to reduce buffer stock.
  • Visualize data based on dwell patterns, bottlenecks, environmental sensors, and real-time locations of assets.

Cloud-based management systems enable the dispersal of information to all players in supply chains, improving communication, and allowing businesses to prepare for the inevitable.When visibility is not just desirable, put a necessary part of compliance, industries turn to Bluetooth for real-time monitoring. Read how Pharma is using Bluetooth in medical supply chains.  Similarly, the Food and Beverage industry is using the sensor capability of Bluetooth Beacons to ensure visibility and compliance.


The evolution of Proximity Tech in Supply Chains


Barcodes and QR Codes


Barcodes and QR codes allow staff to scan data directly into a central repository system.

  1. Inefficient: Time and labour are major factors in barcode-facilitated management systems. Each package needs to be scanned individually – eating into labour costs.
  2. Not Real-Time:  Unfortunately, there’s no way to avoid re-scanning every package to find one critical package or to audit your inventory.

RFID Readers

RFID Reader


To combat some of the shortfallings of barcodes, RFID tags were introduced into warehouses. They contain mini-circuitry which are identifiable via radio waves. RFID tags are classified into passive and active tags.

a. Passive RFID

Passive RFID tags do not contain batteries. They draw power from radio waves directed at them by an RFID reader and reflecting them back. The read range is less than 20 feet, though a huge step up from barcodes.

Cons of Passive RFID in supply chain visibility:

  1. Labour Intensive: Due the 20 feet max read range, employees would need to walk each aisle, scanning all corners with an RFID reader. and cover all corners with a mobile RFID reader.
  2. One-Use Tech: RFID readers are expensive. A mobile phone cannot act as an RFID reader. You need a number of readers, network connectivity, routers, etc.
  3. Not Real Time: Just like barcode technology, RFID is not a real-time system.

b. Active RFID

Active RFID tags do contain batteries which extend the read range to 100 feet. There are still a number of limitations.

Cons of Active RFID in supply chain visibility:

  1. Difficult to scale: Tags, readers and applications cannot be open sourced.
  2. One-Use Tech: Cell phones can’t act as readers.
  3. Expense: Active RFID tags cost upwards of a dollar. Imagine a shipment of 5,000 crates and $5, 000.00 not even including the cost of readers.
  4. Not Real Time: Readers require cellular connectivity and GPS chipsets real-time location of the package in-transit. Active RFID is high energy consuming.
  5. Complexity: Set up is involved. Readers need to be installed, networks created, and constant maintenance.

bluetooth tag

Bluetooth beacons facilitate Real-Time management systems.

Bluetooth Low Energy (BLE) Based Beacon Solutions


For a cost-effective approach, many companies are turning to Bluetooth Low Energy (BLE) to facilitate RTLS. BLE-enabled RTLS works by affixing Bluetooth-powered tags to products, skids, inventory bins and pallets. Employees carry bluetooth-enabled identification cards and product-person interactions are logged for management in user location reports.
Unlike ultra-sonic and RFID, Bluetooth tags do not require expensive transducers, receivers, or gateways. Since cell-phones, tablets, and laptops come equipped with Bluetooth hardware, signals can be picked up and sent directly to a cloud, circumventing the need for expensive, one-use equipment.

Benefits of Bluetooth Low Energy for Warehouse Management:

  1. Cell phones can act as beacons and ‘readers’: Smart devices come with built-in Bluetooth technology, making beacons super cost-effective. No routers, networks, or WiFi needed.
  2. Real-Time: Beacons are constantly chirping signals to gateway readers, giving management a second by second breakdown of all asset locations in a warehouse.
  3. High Read-Range: Bluetooth 5.0, aka Bluetooth Low Energy, requires very little energy to push signals up to 200 feet, outranging active RFID considerably. This means you would need fewer gateways. Did we mention that cell phones can act as gateways?
  4. Less power consumption: Beacons often work via a coin battery which can last for years depending on the Tx (transmission) power of the beacon.
  5. Inexpensive: Unlike RFID tags which are proprietary, Beacons are being manufactured by thousands of companies en masse, driving prices down.

Thank you for reading! We hope you have a better understanding of Warehouse Management Systems and the proximity tech which facilitates them.

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