5 Reasons Why You Should Go for Paperless Warehousing
Warehousing is critical in movement of goods from manufacturer to the end customer. Whenever we come across the term ‘Warehouse’, we imagine a big closed place which is used for storage of the goods to be transported, whether inbound or outbound, trucks moving to and fro, lot of laborers would be working etc.
The Indian warehouse market was worth INR 561 Billion in 2018. The market is further projected to reach INR 968 Billion by 2024, growing at a CAGR of 9.5% during 2019-2024.
Traditionally, warehouses were thought of as storage locations where items were procured from manufacturer and supplied to retail stores (mainly bulk operation) as end customer buy from stores. The so-called Amazon effect – the evolution and disruption of the retail industry, resulting from increased eCommerce – is already reshaping warehousing.
In 2009, India’s eCommerce market was worth $3.9 billion, which grew by 10 folds to approximately $38.5 billion in 2018. The eCommerce market in India is also set to grow at a CAGR of 30% for gross merchandise value to reach $200 bn by 2026 resulting in market penetration of 12% (currently 2%).
To cater to market demand, investors are investing heavily in warehousing projects. Top warehousing markets in India witnessed a growth of 77% year-on-year in leasing in April 2018 – March 2019.
As per Economic Times, India’s warehousing sector has attracted an investment of $3.6 billion since 2017 and the inflow is likely to reach $7 billion by 2021 on robust demand for logistics space by eCommerce companies.
In the current COVID-19 scenario, eCommerce seems as a lifeline of people. As per Ipsos (market research company) 11 out of 12 market surveyed, consumers are frequently buying from online that they normally buy from store.
The largest increase in eCommerce is in Vietnam (57%), followed by India (55%). New players are entering into markets like Jio Mart, Swiggy, Zomato etc in India.
These numbers clearly show that there is going to be significant growth in eCommerce and automation is essential to scale and ensure that errors are minimized.
To make warehouses cater to these demands companies need to reduce the manual and labor-intensive warehousing process to more digitized and automatic.
Paperless Operation: The future of warehousing
As brands promise a fast delivery, warehouses need to upgrade their process. Traditionally, companies often used a paper-based system for their warehouses, but this is starting to change.
Warehouses need to use the new age technology to reduce human error and automate processes like receiving, put away, picking, manifest etc. This trend of using digital rather manual operations in warehouses is known as Paperless Warehousing.
Though paperless warehousing is the future, but still there are many who are reluctant to change from paper processes; as initial set up cost, strategizing & training effort could be obstacle.
Here are top 5 reasons why you should consider switching to paperless warehousing.
1. Increase in Bottom-line
Traditional or a paper-based warehousing requires a lot of labor, resources like paper, tedious and error prone paperwork which in turn leads to consumption of time; time is money.
By reducing manual processes, it is possible to reduce operating costs, increase accuracy, and optimize warehouse space. All these factors would influence final profit.
2. Greater Accuracy
There is a lot of work in a warehouses including data entry where details of each action need to be recorded. Companies tracking orders and shipments with stationary computers or paper-based processes are unlikely to record events accurately or timely.
In reality, the education level of picker or warehouse people is relatively low, which may lead to more inaccuracy. As a brand, you would be aware of the impact of a single wrong delivery fulfillment, end of a loyal customer, multiple penalties from marketplaces etc.
Adopting a paperless approach ensures the risk of mistakes are small and real time capture of all data.
3. Improved Visibility Throughout the Process
Keeping track of every order and shipment, inventory etc is not an easy task. With paper-based processes, data is tracked manually; so, user would always try to reduce the data capture processes.
In a paper-based warehouse, the only method available for tracking productivity and performance is manual logs which is as good as the data each operator would have recorded.
Going paperless with a cloud-based WMS would give real time visibility through various types of reports.
4. Higher Productivity
It takes a great amount of time to supervise and capture each process manually. As there is a high chance of error, to rectify the error would also take a lot of time.
As all the processes are time consuming, it reduces the overall productivity and better customer service. With paperless warehousing i.e. cloud based WMS and mobile app version of operation, a lot of time and errors are saved which lead to a higher productivity.
5. Environmental Benefits
There is no need to explain this as reduction in use of paper, would lead to a greater good of our mother earth by saving trees. With paperless system, companies would save a lot of warehouse space also.
How to Move for a Paperless Warehousing
To upgrade from a traditional warehousing operation to an improved paperless operation would first need a great vision and shift of thought process.
Though it looks like a high investment project based initially, it would get pay itself off in the long term with its benefits as detailed above. The operations in warehouse are mainly receiving, putaway, zone/location transfer, inventory management, picking, packing, manifesting and handover.
In a traditional operation, all these are manual and need high amount of attentiveness for accuracy.
As per reports, paperless warehousing tends to 90% improvement of receiving time, 95% inventory count accuracy, 67% reduction in picking error and 80% improvement in shipping accuracy.
With few of the below changes, the warehousing could be a paperless:
Cloud Based Warehouse Management System
With a cloud-based system, there would be no risk of server management and access location issues. It would lead to a reduced infrastructure, hardware, software, and licensing cost.
These new age WMS enables the entire business to get integrate cumulatively, which would lead to real time data transfer and visibility.
Inclusion of RFID Technology
In a paper-based warehouse all the barcodes for items, pallets, racks are of papers which are wear and tear prone and not reusable. But with RFID chips, the same barcode could be used again and be quickly responsive.
A RFID scanner also could be mounted over inhouse vehicles which would lead to automation of put away, picking processes.
Introduction of Scanning Gun and Mobile App
If operator uses scanning guns or mobiles apps for scanning and processing, all the manual error could get reduced.
The scanner would get the items needed to pick from a centralized system, so when a wrong item would be scanned, it would alert So, for paperless warehousing this is inevitable.
As industry is changing rapidly and market demand is growing, it is the right time to accept technology and upgrade the traditional process.
In the past we have seen various examples of how big brands like NOKIA have fallen, when they did not upgrade with industry.
If you wish to make your warehouses paperless, talk to our experts.
An MBA graduate from IIM, Priyankar works at Vinculum Group as a Product Manager. An ardent learner of new things, he is passionate about the eCommerce and Retail industry.
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