With only 8% of warehouses currently taking advantage of cutting edge cloud technology for their WMS, it’s time for many businesses to start planning a budget for their move to gain a tangible competitive advantage. We’ve already discussed how the strategy behind your overall IT budget correlates with your organization’s ability to grow, so now it’s time to get dig deeper into how to budget for a specific technology solution: a cloud-based WMS.
- Hardware Costs - Make a list of every physical item you’ll need around your warehouse in order to achieve your budgeting goals. Voice picking devices, mobile devices, industrial handhelds, and more can all do wonders to increase your efficiency, and can make up a significant part of your WMS budget. If you’re choosing to stick to an on-premise solution, you’ll need to budget for your own hosting servers and the space needed to house them.
- Software Costs - Be sure to consider the cost of the software itself and any monthly subscriptions that may be a part of a cloud-based WMS. Factor in ongoing support costs and technology needed around you warehouse to run the software if they apply.
- Integration Costs - It’s best to leave this step to the professionals, so adjust your budget to ensure speedy and accurate integration with all of your systems. A warehouse management system is a key component of any organization working within the supply chain — make sure it can communicate with all the other systems your business runs on. Cloud warehouse management systems are often packaged with cutting edge integration technology to connect your systems in a matter of hours, instead of the weeks it could previously take with on-premise solutions.
- An Understanding of How It Fits into Your Overall Budget - As we mentioned in the previous post, your entire IT budget for the year should already be itemized and ranked according to their importance in achieving your business goals. Knowing how much of your budget your other IT purchases for the year will take up will allow you to better determine a price range you can work in for your new WMS.
- Getting Talent to Buy In - The final component of every effective budget is having a plan built in to ensure that your employees utilize the technology you’ve just purchased. Budget time and resources into fully training your employees on the new system to alleviate any potential frustrations and to ensure a smooth transition to the new technology.
Make a comprehensive list of everything your business needs its new WMS to be able to do in order to encourage growth and easily scale with that growth. After you’ve made a complete list of features (such as voice picking, mobility, analytics, and billing), rank the importance of each feature relative to the value it can create for your business. In case your budget is not able to adequately cover the perfect solution with every feature you need, this will allow you to ensure that you check off as many of the needed features as possible while you’re weighing your options.
Be sure to stop by our blog again next week when we’ll delve even deeper into budgeting for a cloud-based warehouse management system by showing you how a new WMS can actually help increase your budget.
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