Understanding how to build an ecosystem with an e-commerce warehouse management system is often the part of delivering a warehouse management system that involves the most complexity.
Getting the technology ecosystem right needs to happen. It is better to invest the time upfront and lay out a roadmap that includes the WMS implementation and any other technology choices that need to me made at the same time or immediately following go-live.
E-commerce is dealing with emerging platforms that are transforming the ecosystem and stretching the limitations of what can be achieved in the industry. A successful e-commerce ecosystem must be fluid and adaptable so that it can react to the demands of the market even during peak periods. Staying agile means being able to make changes when things don't work out. Perhaps a better way to think about it is to consider it mitigating risk. Finance Directors understand this as much as CTO's do.
Staying 'agile' means being able to make changes when things don't work out.
Warehouse Management Systems (WMS) are integral to the e-commerce ecosystem and a good one will be able to sit alongside and integrate with a network of interconnected systems that make your WMS e-commerce operation work more smoothly.
Increasingly, it is the e-commerce platforms world and we are merely living in it. What I mean by this is the e-commerce platforms are the centre point of a company selling online.
We're seeing a tug of war between traditional Enterprise Resource Planning systems and E-Commerce platforms within the technology ecosystems of high-growth retailers.
An example of this is NetSuite. They're the leading software-as-a-service ERP and promote their own e-commerce platform. This model is struggling to gain traction as they're limited to selling to their own ERP customers which reduces the number of companies who can use and the technology in 100% focused e-commerce platforms is impossible to keep up with.
At time of last update (October 3rd 2019) these are the e-commerce platforms that are being used by high-growth brands in the UK, Europe, the US and ANZ.
|Vendor||Regions served||Who builds the website||Tech|
|Shopify / Shopify Plus||Global||Partners||SaaS|
|Magento (Adobe)||Global||Partners||On-premise / Cloud Hosted|
|Salesforce Commerce Cloud||Global||Partners||SaaS|
|Visualsoft||UK + MENA||Vendor||Cloud Hosted|
|Commercetools||Global||Partners||Microservices / API only|
The focus on becoming a platform is what is driving the development of the e-commerce platforms and the strategy varies between each of them.
Shopify is actively bringing more functions into their own solution, buying adjacent companies and extending their functionality. An example of this is their purchase of Stocky, a Shopify specific purchasing and inventory planning tool. This fills a gap in Shopify's core functionality and reduces the need for their merchants to invest in an ERP. Their acquisition of Returns Magic is another example of this.
Product Information Management
For an increasing number of companies, the product information management provided by their e-commerce platform meets their needs.
If you're managing multiple price lists and languages, this may be an area that you start to struggle with on platforms like Shopify Plus, BigCommerce and Magento.
Their are e-commerce specific Product Information Management systems.
Akeneo is the most well-funded and it has a number of connectors to the leading e-commerce platforms, such as Shopify Plus.
Generally, most merchants using Magento or Shopify don't need to use a PIM.
Platforms like BigCommerce, Salesforce, Commercetools (have their own PIM product) do require a PIM.
|Comestri||Australia + New Zealand + UK|
|Akeneo||France + Europe|
|Jasper PIM||US + Canada|
Marketplace / channel management
This is essentially how products are placed on the e-commerce platform. You will want your WMS e-commerce ecosystem to be closely linked to this channel. Managing inventory, especially across multiple marketplaces, can bring with it many logistical challenges. With the integration of your sales channels and WMS you are able to manage that process quite easily, and ensure that you have real-time stock data from your warehouse so you will know exactly when to stop selling the product online.
Comestri combines PIM and channel management and is popular in Australia & New Zealand with tier 1/2 retailers.
Carrier management / Shipping labels
Any WMS e-commerce operation looking to run a smooth operation will want shipping labels printed on demand so that the pack and despatch process is made as smooth as possible. Your WMS should be able to integrate with your chosen shipping partner or partners, so that you can fulfil that requirement, as well as closing the loop by sending tracking information back to your staff in the back office.
The right service provider will depend:
- Order volumes
- Whether you need a shipping API to trigger label printing behind the scenes or a software to login to and print labels as part of your despatch process
- The range of carriers you need
- The country or region you are located in. Because of the locality of certain carriers, local solutions tend to have more carriers.
Here are some options for you to consider. It is worth noting that shipping solutions that have an App are suitable for smaller merchants as they can connect directly to your website and provide a shipping workflow that is used in place of a warehouse management system.
|Vendor||Primary region||API / App||Suitable # orders per month|
|MetaPack||UK + EU||Both||>10,000|
|Scurri||UK + Ireland||Both||>10,000|
|Paazl||NL + EU||Both||>10,000|
|Sendcloud||NL + EU||Both||>1,000|
|StarshipIT||ANZ + UK||Both||>1,000|
Delivery Experience is about giving the customer choice on when and how they have their products delivered to them.
In Europe, Paazl, are one of the leading providers of this service. This is what it can look like for a customer:
Retail / POS software
There are two ways to integrate retail and POS into your systems.
1. Retail Management System at the core of your operation
If you have an Enterprise retail platform that is functioning as your ERP then it makes sense to integrate your WMS directly to it to manage the store replenishment and e-commerce fulfilment. The assumption is that you are doing both types of fulfilment from a single warehouse to maximise your online inventory availability.
2. Point of sale for taking sales in your store
Simple web-based solutions like Vend can be used to do this and established £50M+ retailers like Rapha do this.
If you're considering Shopify or Shopify Plus, one of the big advantages they offer is that you can just extend it to use ShopifyPOS.
Enterprise Resource Planning (ERP)
Initially, the term ERP and the products created were designed to service manufacturers.
A system being classed as an ERP is typically dependent on a single system taking ownership, becoming the master of the financials and accounting, sales orders, purchase orders. Product management or at least the creation of the SKU code would usually be done in here too.
ERPs are challenged in e-commerce by all-in-one systems that avoid the complex accounting functionality and focus on requirements that are more specific to e-commerce. For example, native integration to marketplaces or e-commerce platforms.
If you're a wholesaler with sales teams who take orders or a manufacturing company with BOM / assembly requirements or a multi-national business with multiple subsidiaries take a look at NetSuite.
Do you need an ERP checklist?
- Manufacturing / BOM / Assembly requirements
All-in-one / Inventory Management Systems
Increasingly used by companies to get started. These are the systems that companies most frequently migrate from when they move to a full warehouse management system.
Examples of all-in-one systems
|Popular in||Integrated with Peoplevox?||Focus||Limit without a WMS in orders per day||Has a basic mobile app|
|Trade Gecko||APAC + UK||Yes||Startups and BOM / Assembly requirements||150||N|
|Brightpearl||UK + US||Yes||Retailers with stores||300||Y|
|Stitchlabs||US only||No||Direct to consumer brands||200||N|
|Cin7||Australia + New Zealand||No||Brands with wholesale + e-commerce, manufacturers with BOM||300||Y|
Each of these solutions offers warehouse management functionality to a certain degree.
Here are some of the main advantages a specialist warehouse management system offers versus an all-in-one:
As you begin to scale up you will see that there is a limit to what your accounting software can achieve. A WMS can work alongside your accounting software to reduce the volume of transactions you run through it.
For e-commerce the trick is to avoid posting every sales transaction into your accounting system. Many companies fall into this trap and the web-based accounting systems can't handle the volume of orders.
Instead, consider doing this:
- Posting sales into the nominal ledger
- Integrated your e-commerce platform to your accounting platform for sales and refunds / credits
- Posting inventory monthly, using your WMS for an inventory valuation
- Raising purchase orders in your accounting system and integrating goods receipt notes
- Integrating a live inventory adjustment if you have an Enterprise solution like NetSuite
Integrating your WMS and the rest of your e-commerce platforms is particularly important, you will want to ensure that you think carefully about each part of your ecosystem and ensure that they work well together. If you choose the wrong system you could see it have a knock on effect on your whole supply chain, so think carefully about each step of your e-commerce ecosystem.
You can view what integrations we offer here.