What is the difference between a WMS and an ERP?

When trying to optimise your fulfilment operation, it’s important to know the details of every system and option available to you.

Two of those options are warehouse management systems (WMS) and enterprise resource planning (ERP).

Although a lot of the features of a WMS and ERP overlap, there are some key differences which set the two apart.

We’ve put together a guide to help you understand the differences between a WMS and ERP, as well as help you decide which system might be best for you.

What is a WMS?

A WMS is a piece of software which helps you keep track of your warehouse operation. That includes everything from monitoring inventory levels, picking and packing items, and shipping.

An example of a common feature in a WMS is the ability to identify high-priority targets and goals, and then assign staff members to those tasks to maximise productivity.

When integrating a WMS designed by a separate company, you’ll often receive accompanying tools such as tablets and monitors installed with the required software. These help you and your staff take control of your operation with little training, allowing you to continue fulfilling orders even if you’ve just integrated a brand new system.

In contrast to an ERP, a WMS is a focused solution to a specific challenge; inventory and warehouse management. Beyond that, a WMS is limited in its capabilities.

What is an ERP?

An ERP is much more of a jack-of-all-trades than a WMS. Rather than being restricted to just one area of a business, an ERP covers an entire enterprise.

That includes finance, marketing, sales, human resourcing - and even warehouse management and fulfilment. An ERP automates repeatable processes such as payroll, invoices and reporting - eliminating the need for manual data entry.

Many of the features of a WMS are also included within an ERP, for example inventory management and the amount of picked and packed items.

What’s the difference?

Although they share a lot of similarities, there are some key differences between the two systems. Of course, there’s the obvious: a WMS is specifically for warehouse management and fulfilment, whereas an ERP covers the entire business.

A WMS is also a stand-alone system which generally requires other integrations to go with it, such as a transport management system (TMS) or a customs management system (CMS). Integrating these helps you optimise your warehousing operation to be even more effective.

On the other hand, an ERP is an all-in-one system. That doesn’t mean you can’t integrate other things with your ERP, but a lot of features tend to already be included.

An ERP also doesn’t provide real-time inventory tracking and doesn’t optimise your warehouse in the same way a WMS can. For example, it doesn’t automatically plan the best picking and packing routes for improved warehouse efficiency.

Integrations

An ERP doesn’t have all of the useful features which make a WMS so effective, so you might be considering using both simultaneously.

Because a WMS is a stand-alone system, you can actually integrate it with your ERP so that you reap the benefits of enterprise-wide automation as well as the real-time inventory management options which come with a WMS.

However, if you don’t have the resources for both, you should weigh up which system would be best for you. Look at what your weaknesses are: are you already handling your general operations quite well, but you need an extra hand with your fulfilment? In that case, maybe just integrating a WMS would be best for you.

Alternatively, if your warehousing is up to scratch and you need an extra hand automating your enterprise, you might gain more from an ERP.

Whatever you decide, you’ll need an experienced integrations provider to connect your data.

At Patchworks we’ve worked with some of the biggest ERP and WMS systems out there, and have a passionate round-the-clock team to help you out. Get in touch through our website for more information on how we can help you.