Running your warehouse operations through your ERP system can offer benefits like data centralisation and streamlined workflows—but it also comes with several downsides, especially for growing or complex logistics operations.
Downsides of Running Warehouse Operations Through ERP
Lack of Specialised Functionality
- Most ERP systems aren’t purpose-built for warehouse management.
- They often lack advanced WMS features like:
- Real-time bin-level inventory visibility
- Directed putaway and picking logic
- Zone-based wave picking or cross-docking
- Advanced barcode or RFID scanning support
Result: You may face operational inefficiencies or require workarounds.
Poor Real-Time Performance
- ERP systems often don’t update in real time or aren’t optimised for live warehouse environments.
- Delays in inventory or order status updates can impact:
- Order accuracy
- Shipment timing
- Stock reordering decisions
Limited Flexibility for Warehousing Workflows
- Many ERPs offer rigid workflows that can’t be easily customised to your warehouse layout or product flow.
- This limits agility in:
- Slotting changes
- Multi-location setups
- Seasonal or high-volume peaks
This can reduce throughput and responsiveness.
Higher Complexity for Integration
- Connecting ERP-based warehouse logic with scanners, conveyors, sorters, or 3PL partners may require:
- Custom APIs
- Expensive middleware
- Ongoing IT support
Integration complexity can lead to project delays or data mismatches.
User Experience and Training Challenges
- Warehouse staff often find ERP interfaces clunky or not mobile-friendly.
- Training warehouse workers on ERP workflows (especially for handheld or tablet use) can be more time-consuming compared to a dedicated WMS UI.
Upgrade and Maintenance Constraints
- ERP upgrades can cause downtime across all modules, including warehousing.
- Adding new warehouse features may require a full ERP system upgrade, affecting finance, HR, etc.—even if the need is only in operations.
Scalability Limitations
- As operations grow—multi-site warehousing, higher SKU count, or faster order cycles—ERP-native solutions often don’t scale well.
- You may eventually need to bolt on a dedicated WMS or risk serious inefficiencies.
Bottom Line
Using your ERP for warehouse management can be cost-effective early on, but it becomes a liability as complexity grows. The system may lag in warehouse-specific functionality, performance, and scalability—leading to slower fulfilment, more manual work, and reduced agility.
ERP vs Dedicated WMS for Warehouse Operations
|
Feature/Aspect |
ERP-Based Warehouse Module |
Dedicated Warehouse Management System (WMS) |
|
Core Purpose |
Broad business management |
Specialised in warehouse operations |
|
Inventory Accuracy |
Basic item/location tracking |
Real-time, bin-level, and cycle count enabled |
|
Picking/Putaway Logic |
Manual or static rules |
Dynamic, optimised routes and zones |
|
Mobile/Scanner Integration |
Often limited or add-on |
Native support for handhelds/RFID devices |
|
Multi-Warehouse Support |
Basic multi-location |
Granular, flexible, with custom rules per site |
|
User Interface (UI) |
Generic, ERP-style |
Warehouse-optimised, mobile-friendly |
|
Scalability |
May become slow with volume |
|
|
Integration |
Requires customisation for WCS, 3PL, etc. |
Built to integrate with conveyors, 3PL, carriers |
|
Upgrade Flexibility |
Changes affect entire ERP stack |
Independent upgrades, modular add-ons |
|
Cost (Initial) |
Lower (already part of ERP) |
Higher upfront or SaaS monthly fee |
|
Cost (Long-Term) |
Hidden costs via workarounds |
More predictable ROI from efficiency gains |
LPC have recently supported two overseas clients who were previously reliant solely on their ERP systems through the procurement process to identify the appropriate vendor of a WMS system. If you are considering a new WMS system, please contact LPC for a no-obligation discussion.
