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Why Warehousing Innovation is Key to Supply Chain Resilience

People working in a warehouse - innovation is key to supply chain Resilience
Warehousing Innovation is Key to Supply Chain Resilience

When businesses consider their supply chain effectiveness, warehousing innovation may not always be “top of mind”. However, warehousing innovation, whether it be a turnkey solution or customized, can make a difference in advancing your supply chain.

In our previous article on how better warehousing practices impact supply chains, one key takeaway is to move away from the mindset of warehousing management as a lower-priority, lesser management type of environment. Moving away from the stigma of having poor performing workers manning warehouses and its practices, Aw Yang Uei, Managing Partner and founder of AC2 Group, shared how having the right mindset of innovation can improve margins and profitability of a business significantly. For example, a pharmaceutical company that had deployed robotics and WMS, observed savings of up to 70-percent with a combination of robust WMS solution and Autonomous Mobile Robots (“AMR").

But what does this mean for businesses looking to be more competitive and resilient in today’s fast-moving, consumer-centric world? According to KPMG’s research, Asia and the ASEAN region is home to a large consumer base, with a growing middle class and relatively young population. ASEAN is also set to grow to become the 4th largest economy, with a USD 4 trillion consumer market. These observations put added pressure on businesses who must be more proactive in understanding their supply chain management beyond their shippers of choice.

From e-Commerce shop fronts to package in hand

Take e-commerce for example. In ASEAN, more homegrown labels are bringing their businesses to the world stage with the advent of technology. Besides leveraging e-commerce solutions on creating digital storefronts to serve an international market, can e-tailers benefit from understanding more about supply chain management?

The short answer is yes, and that doesn’t mean micromanaging their supply chains. Here are some key questions business owners can ask their suppliers/warehousing partners to gain visibility on the effectiveness of their supply chain.

  1. Is the current warehousing set-up digitalized and ready for automation?

  2. Are there reporting requirements and provision to customers?

  3. What about inventory tracking? Is the current set-up provisioned to act on surge demands and maintain agreed turnaround times?

  4. Is the current warehousing management system configurable to address allocation, putaway and picking logic to suit peak period demands?

Having a smart warehousing management system makes a world of difference

Granted that not all suppliers can or will provide feedback to their customers, it is prudent for businesses to raise these considerations before the start of a new engagement. This transparency allows for businesses to manage their own supply chain with different scenarios in mind, including surge and lull demand periods, and to work on business models such as just-in-time fulfillment to ensure maximized operational costs.

Take AC2’s Wave WMS for example, it is the most advanced world class low-cost cloud native Warehouse Management System, built in with A.I. optimization so you can pick faster, deliver more with less manpower. As a cloud-based offering, your warehousing partner gets immediate benefits such as reduced hardware costs, and abilities to sync with established e-commerce platforms such as Shopee and Lazada. These resources saved can be translated into cost-savings for customers at the end of the day, where businesses can choose to redirect them into better offerings or prices to stay ahead of competition.

Read more about the 8 characteristics of a WMS that can help address some of the questions to understand the capabilities of your supply chain partners.

Being prepared is half the battle won

Building a resilient supply chain does not happen overnight. While we cannot predict how macroeconomic trends may shift for every single market, what businesses can do is to stay informed, so that they can make educated choices about their supply chain management.

Our domain expertise in supply chain and logistics has helped the best-run companies run better in their warehouses and on the road. Grow your business, increase efficiency, reduce waste, and stay ahead of the curve.

By Lynn Tan


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