Thought Leadership
What is a Warehouse Management System (WMS)
Warehouse Management Systems are fundamental software platforms in the global supply chain. In this post we highlight the function and importance of these systems, and the rich data they contain.
Trackstar Team
February 4, 2024

Thanks to the revolution of cloud-based logistics, Warehouse Management Systems (WMS) have become critical tools in the arsenal of 3PLs, manufacturers, and retailers alike. With a powerful WMS solution, it’s possible to gain full visibility of your entire fulfillment operation from end to end, unlocking valuable insights about warehouse performance and efficiency.

But here’s the catch: A WMS offers valuable insights if you can access and extract the data you’re looking for, and this is far easier said than done.

In this blog, we’re going to explore the capabilities of Warehouse Management Systems and the benefits they offer, as well as the difficulties encountered when trying to extract data–and how Trackstar can help!

What is a Warehouse Management System (WMS)?

A Warehouse Management System (WMS) is a technology platform designed to monitor and streamline operations within a warehouse. This includes order processing and fulfillment, inventory management, storage configuration, return management, and more. 

A robust WMS tracks every stage of the fulfillment process, from fresh inventory arriving in your warehouse to dispatching completed orders for shipping. This real-time visibility makes it possible to monitor warehouse performance and identify areas of friction that are causing errors or slowdowns, so you can ensure your fulfillment operation is running at peak efficiency. 

Who uses a Warehouse Management System?

Warehouse Management Systems are used by lots of parties in the supply chain to manage warehouse operations more effectively, including manufacturers, wholesale distributors, and third-party logistics (3PL) companies. Some large retailers may also use an in-house WMS if they’re running private warehouse facilities.

What is the difference between a WMS and an ERP?

WMS systems are often confused with Enterprise Resource Planning systems (ERPs) because they both play important roles in supply chain management. However, they have different use cases.

Where a Warehouse Management System is tasked with managing warehouse-specific operations, an ERP takes more of an overarching organizational role. This includes logistics and other departments such as HR, procurement, finance, CRM, and more. This means an ERP is not a replacement for a WMS, as they aren’t configured to manage day-to-day operations within a warehouse or offer granular reporting.

The benefits of using a Warehouse Management System

Streamlined order processing. A powerful WMS system massively speeds up order processing by integrating directly with eCommerce platforms and routing new orders to the warehouse as soon as they’re placed. This means a faster turnaround from placement to fulfillment, saving precious hours in getting orders ready for shipping.

Optimize inventory levels and storage. Forecasting demand for different SKUs can be a major challenge, especially if you don’t have full visibility over inventory. A WMS gives you a complete view of inventory movements inside your warehouse, so you can make more informed decisions about inventory replenishment and storage/picking configurations. 

Better scalability. A rapid growth in order volumes can lengthen fulfillment timeframes if a logistics operation cannot keep pace. A WMS is designed to scale alongside rising order volumes or SKU proliferation, ensuring the same level of visibility and responsiveness as businesses grow.

Leveraging rich data insights. Because a WMS tracks every stage of the fulfillment process, these systems hold vast amounts of data that help businesses identify inefficiencies, optimize their operation, and gain a competitive advantage.

What types of data can a WMS track?


A WMS gives you a bird's-eye view of your operation that’s impossible to get on the ground. Whether it is receiving times for fresh inventory, picking accuracy, or even safety metrics related to accident rates on-site, WMS systems offer a valuable portal to record all of these data in one place.


Even with a relatively small product assortment, it’s easy to underestimate the depth and complexity of SKU management. Your WMS can monitor every item in your inventory to give a real-time overview of inventory levels, storage location, and when fresh replenishments are en route. This offers a gateway to tracking important KPIs like shrinkage, days on hand, and holding costs, so you can make informed decisions about inventory.


Monitoring the flow of orders from receiving to shipping gives businesses useful data on how well orders are being managed. A good WMS can offer information on processing times, order status (i.e. received, picked, packed), order history, and shipment status, so businesses can get up-to-the-minute order updates and understand where slowdowns are occurring.


No one wants to think about orders or inventory bouncing back into the warehouse, but returns are unavoidable. Being able to track the frequency of returns via your WMS, as well as turnarounds to restocking and refund rates, enables you to identify patterns in return activity that are affecting your operation. 

How to leverage WMS data to grow your business

Your WMS is a rich data source on just about every facet of your warehouse operation. The question is: How do you access it?

While WMS are great at gathering and holding data, actually extracting this information can be extremely difficult. Many warehouse management systems don’t offer customizable reporting capabilities, or else structure data using proprietary formats that are time-consuming or difficult to format into user-friendly reports. 

Depending on the WMS provider, you may not have permission to retrieve certain data independently for security reasons. Even when you do have permission, there’s a risk of WMS data being corrupted as it gets transferred from one format to another, playing havoc with your ability to get the full picture of your operation.

This is where a powerful universal API like Trackstar provides a single source of truth so businesses can get to grips with the latest activity in their warehouse–no developer expertise needed!

By syncing seamlessly with your WMS, Trackstar offers a unified overview of your data on orders, inventory, returns, and more so you no longer have to waste valuable time and resources ensuring data accuracy. Instead, you can take action on the latest operational insights to grow your business and streamline fulfillment.