Is SAP EWM suitable for small and medium-sized warehouses?

SAP EWM (Extended Warehouse Management) is a powerful warehouse management solution designed to optimize companies' logistics processes. It provides real-time visibility into inventory management and increases efficiency by using technologies such as machine learning, Radio Frequency scanning and RFID.

As an owner or manager of a small to medium-sized warehouse, you may be wondering if SAP EWM is the right choice for you.

In the past years our team has implemented EWM solutions at warehouses of all sizes, ranging from small warehouses to huge retail DCs with 100,000+ pallet places. Based on our experience we feel safe to say any warehouse, large or small, can benefit from running EWM.

In this blog we will explain why and how.

Recently we have noticed a shift in the type of companies implementing EWM solutions. With the introduction of S/4HANA and the “embedded” deployment option of EWM, all companies running SAP automatically get the basic version of the EWM module at their disposal. This makes it attractive for companies with warehouses of all sizes to implement EWM and enjoy the benefits of advanced warehouse management functionality.

At the same time, we have experienced in multiple implementation projects that smaller warehouses have different operational dynamics and considerations to make.

Below are the top 4 questions we have encountered.

What are the benefits of a Warehouse Management System (WMS)?

Improved efficiency: a WMS allows you to automate and streamline the warehouse management process, improving staff productivity and efficiency.
Improved inventory management: The system provides real-time visibility into inventory status, allowing companies to make better decisions about inventory replenishment and movement.
Increased accuracy: Using a WMS minimizes manual errors and reduces the risk of human error in the warehouse management process.
Improved customer service: The system provides real-time visibility into inventory location and availability, which enables companies to better inform their customers about delivery times.
Cost effectiveness: A WMS leverages advanced technologies such as RFID and automation, allowing companies to streamline their warehouse management processes and save costs.

Can I keep my processes simple and lean?

Even though SAP EWM can handle complex warehouse processes, the system is modular and can be configured for basic processes as well.

For example, advanced storage and putaway strategies can be configured and applied. However, EWM can also be configured in such a way that the warehouse operators can decide the optimal bin locations themselves.

This is just one example of the flexibility within EWM, and the key is to define a setup which is “fit for purpose” for your warehouse.

Guided by our consultants the sweet spot can be identified so you can leverage the advantages of a WMS without overcomplicating things and adding administrative tasks.

Is handling unit management mandatory?

One of the features of SAP EWM is its handling unit management functionality, which can be used to group materials for transport or storage. While this may be useful for some warehouses, there are reasons why small warehouses may be better off without handling units in SAP EWM.

Small quantities: When dealing with small quantities in storage, handling units have limited added value and can bring complexity with them.
Increased efficiency: Without handling units, the process of receiving and storing goods can be faster and smoother because there is no need to create the handling units.
Reduced complexity: Handling units can add complexity to warehouse processes, requiring additional steps for packing and unpacking goods. Working without handling units can simplify processes.

The power of SAP EWM is that the system can be configured to work with and without handling units. We have even implemented EWM at warehouses which use a combination of both. In this case handling units are not used internally, but in the outbound process shipping handling units are used to register packages required for transportation.

In the end, whether to use handling units is a decision to be made case by case and our experts can provide tailer-made advice what fits best for your warehouse.

SAP EWM supports all your warehouse processes with and without using scanners. However, using RF scanners in your warehouse can provide several benefits, including:

Increased accuracy: Using RF scanners, warehouse workers can work more accurately when receiving, shipping, counting and moving goods. The system records all movements directly upon scanning and can provide error messages when incorrect actions are taken.
More efficient processes: RF scanners can make processes within the warehouse more efficient, increasing productivity and reducing lead times. There is no more need for paper registration and separate data entry in the system.
Real-time information: RF scanners can track real-time information on inventory levels, locations and order statuses, allowing warehouse workers to work faster and more efficiently without constantly walking to their workstations. The executed actions are also available to the rest of the company in real time.
Improved traceability: RF scanners can accurately track every movement of an item within the warehouse, improving the traceability of goods.
Increased customer satisfaction: With the accuracy and efficiency offered by RF scanners, orders can be processed faster and more accurately, which can lead to increased customer satisfaction.

In short, working with RF scanners can lead to more efficient and productive warehouse operations.

Please note that if you decide to use RF equipment for SAP EWM, working with barcode labels for products and locations is essential. Working with barcode labels is therefore an important part of using RF equipment in conjunction with SAP EWM.

Conclusion

In our experience, SAP S/4HANA EWM is a smart choice for small logistics companies looking to grow and stay competitive in a rapidly changing business environment. The system provides a flexible and effective solution to improve and optimize warehouse management processes without adding additional complexity or license costs.

Interested to continue the discussion?

With our proven track record and expertise, insideSCM is the right consulting company to help you optimize your warehouse operations.

We have extensive experience in successfully implementing SAP EWM for small and midsized warehouses over the past years. Our team of experts has a deep understanding of the unique needs and challenges faced by these businesses and can provide customized solutions to address them.

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