WMS

Warehouse Management System

BusinessGlossary
Definition

A WMS (warehouse management system) is software that controls the physical work inside a warehouse: receiving, putaway, storage locations, picking, packing, shipping and counting. It tracks each unit to a specific location, lot and status, and directs workers through scanning so records match the shelves.

What a WMS does

A WMS covers the flow of goods from the dock door to the truck. It knows not only how many units you own but where each one is, and it tells people what to do next.

  • Inbound: check purchase orders and ASNs, receive, capture lots and serials, direct putaway.
  • Storage: bin locations, pick faces, stock statuses such as quarantine and hold.
  • Outbound: allocate orders, create pick lists, verify packing, print labels, dispatch.
  • Control: cycle counts, holds, recalls, returns and an audit trail of every movement.

A worked example

An order arrives for three bottles of OIL-008 and one box of phone cases. The WMS allocates the oldest-expiring lot of oil from the pick face and the cases from A-01-02, adds both lines to a pick list sorted by the route, and asks the picker to scan each bin and item. At the packing bench, each item is scanned again before a label prints. If the picker scans the wrong lot, the system stops them there, not after the customer complains.

WMS vs inventory software and ERP

Simple inventory software records quantities, often per warehouse. A WMS records quantities per bin, lot and status and directs the work that changes them. An ERP runs finance, purchasing and sales across the business, and usually treats a warehouse as a single number. Our comparisons of WMS vs ERP and WMS vs spreadsheets go into the trade-offs.

A business usually needs a WMS when it runs more than a few hundred SKUs, tracks lots or expiry, stores stock for clients, or finds that mistakes are coming from people searching for stock.

How NextStock fits

NextStock is a cloud WMS for brands, 3PLs and distributors, in open beta and free to use. It runs in the browser, with a floor app for phones and scanners that installs as a web app. It includes lot, serial, LPN and status tracking, allocation, discrete and batch picking, scan-verified packing, B2B freight documents, cycle counts, holds and recalls. See the product overview or the guide to choosing a WMS.

Part of the NextStock warehouse glossary. Browse the full glossary

Frequently asked questions

Short, direct answers to the questions warehouse teams ask most.

Do small warehouses need a WMS?

Size matters less than complexity. A small warehouse with a few hundred SKUs, lot or expiry tracking, or several clients' stock will benefit sooner than a large one with a handful of pallet SKUs. The usual signs are pickers searching for stock, counts that never match and orders shipping the wrong lot.

What is the difference between a WMS and an OMS?

An order management system (OMS) collects orders from sales channels and decides which warehouse fulfills each one. A WMS takes an order once it reaches a warehouse and runs the physical work: allocation to specific bins and lots, picking, packing and shipping. Many operations run both, with the OMS feeding the WMS.

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