Three ongoing WMS costs you forgot during budget calculations

You’ve done the hard part and put together a WMS budget covering selection, training, and implementation.

The boss said “Congratulations”. You’re ahead of most and you’ve got a lot of the necessities covered.

But, three months in, you realize things are more expensive than expected.

You’re dreading that quarterly call and trying to figure out what happened before trouble comes from above. Ongoing, subsequent costs have slipped in and are making your life a pain.

If that feels a bit too familiar or you want to avoid this budget disaster scenario, let’s look at three of those big ongoing costs that sneak in and don’t go away.

To grow, you needed more people

When building a WMS budget, many companies base cost estimates on their existing staff. After implementation, a successful WMS will ease many task burdens and the nature of some positions will change.

These shifts can often lead to more people spending time with screens to manage and analyze your warehouse operations.

As user numbers grow, you will often need more licenses to accommodate them. If you are paying per user or per block of use, costs will rise when you reach the next threshold. Sometimes this may be an increment of one user and a small cost. Other times, you may move from a bracket supporting up to 10 users to one that supports up to 100 — here, you’re going to feel the jump a lot more in your budget because you’re paying in bulk.

Guide: WMS software pricing guide

If you’ve bought your software outright with a perpetual license, this issue may look a little different. Perpetual licenses don’t always cover required upgrades, and in the past some WMS have required upgrades to support users beyond a certain threshold.

Always plan to grow and budget based on that growth forecast.

To operate, you needed more support

You likely picked up a support package when you selected a WMS and budgeted appropriately for that. What you might not have budgeted for are costs related to internal support and maintenance.

Support tends to get expensive quickly when you call your WMS vendor to assist with every little issue, so you’re turning to your internal teams more often. For large operations, that typically means someone who is always ready to field questions from your WMS users and a variety of team members to check equipment, manage network connections, and look for errors in data handling and reporting.

Each major software adoption, from WMS and ERP to custom software for your industry, will come with something akin to a new internal helpdesk mandate. From general support to training fresh staff and solving issues that occur during the day, you might be spending more than expected to have your team keep the WMS running smoothly.

To continue, you needed better infrastructure

In WMS discussions, infrastructure is often thought of only as the PCs and servers you’ll need to manage the new system. While you might have budgeted for these items, there are other mobile devices that tend to get overlooked, such as label makers and handheld scanners, as well as the supplies these need.

Did your new WMS link up with a new label maker that speeds up your time? That’s great. Just don’t forget that it likely includes a need for a bulk order of new labels, plus you’ve got to get rid of the blank labels from your old equipment. Or, you may end up needing more supply storage space to hold new equipment and refills.

The shift in space is important because some WMS that come with major infrastructure overhauls may include space requirements that eat into inventory locations. You may also have predicted that these items would be a source of revenue via a reseller, but have learned that used goods don’t give you a significant bump.

Traditional infrastructure costs also creep up once a new WMS makes connections faster. Staff will want to make the most of their new speeds and that will lead to requests to replace much of your older equipment.

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Geoff Whiting

About the author…

Geoff is an experienced journalist, writer, and business development consultant with a focus on enterprise technology, e-commerce, and supply chain development. Outside of the office he can be found toying with the latest in IoT, searching for classic radio broadcast recordings, and playing the perpetual tourist in his home of Washington D.C.

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Geoff Whiting