Cloud vs. SaaS Warehouse Management System – The Key Differences

Supriya Bajaj

Supriya Bajaj

Senior editor

Parul Saxena

Chief editor

Last updated: May 14, 2021

Warehouse optimization is a critical performance parameter that can help your business surge ahead of rivals. Poor warehouse management can cost your business tons of money and gain a negative market reputation!

You do not want to have inefficient delivery practices, overstock inventory, and undergo pilferage of supplies. So, what’s the solution?

Investing in a professional warehouse management system (WMS) is a smart decision that can transform operational efficiency.

Looking for Warehouse Management Software? Check out SoftwareSuggest’s list of the best warehouse management software solutions.

Read on if you are looking to implement the best inventory and warehousing practices – they can make a world of positive difference and give your business an instant competitive edge!

In the post-pandemic world, we can expect a surge in online demand for multiple goods from various industrial sectors such as pharmaceuticals, food and beverage, cosmetics, and daily essentials. This will encourage the growth of automated WMS solutions to facilitate contactless and timely delivery to global markets.

What Is A Warehouse Management System?

WMS platforms have already taken over the business world by storm. Warehouse management solutions empower supply chain professionals to boost productivity and adopt new technologies for stock management.

But what exactly do we mean by a warehouse management system?

Simply put, a warehouse management system is an automated platform that helps organizations manage their inventory cycle and track the movement of supplies through warehouses and distribution centers.

Sounds like a helpful business asset, right?

Well, it is the perfect tool to optimize your warehouse design to ensure you save space and allocate inventory in the right location at storage centers. Not only that, with warehouse management software, you get to implement and master new state-of-the-art technologies such as radio-frequency identification and barcode scanning for real-time inventory tracking.

Warehouse Management System

Source: WMS

There’s no doubt that warehouse management systems are the future of efficient stock-keeping! The warehouse management software market is expected to grow to a whopping USD 5.1 billion by 2025. This depicts the phenomenal growth in the automated warehouse management technology sector worldwide.

The Major Differences Between SaaS And Cloud-Based WMS Platforms

While you may feel you know it all about warehouse management systems, it is imperative to make an informed decision to accrue maximum benefits. One aspect that often confuses users is the method of deployment – is it better to opt for a Software-as-a-Service (SaaS) or a cloud-based WMS system?

Well, if you are a key decision-maker for your organization, you need to clarify some common misconceptions about SaaS and cloud-based WMS platforms that may influence your choice:

  • Affordable Pricing: Both SaaS and cloud-based warehouse management systems are highly affordable. Hence, you need to assess your business requirements before deciding on the one option that will be suitable for your inventory and warehousing model.
  • Advanced Functionality: Some people may feel that cloud-based warehouse management platforms have more innovative features than advanced technology. However, SaaS and cloud-based WMS solutions offer superior top-of-the-line features that can handle all your delivery, shipping, supply monitoring, packing, inventory movement, and distribution.
  • Great Customer Service: Both SaaS and cloud-based warehouse management platforms provide good customer service, depending on the contract with your software vendor. Hence, choosing a reliable service provider to receive after-sales support and training is critical, whether you opt for a SaaS or cloud-based warehouse management system.

Now that we have cleared the air about some common myths surrounding SaaS and WMS platforms let’s check out the major differences between them.

SaaS-Based Warehouse Management Software

SaaS, the popular acronym for Software-as-a-Service, is a delivery model where the web-based system is stored or hosted on shared infrastructure. In SaaS-based warehouse management systems, your organizational data will be stored on a common server with other customer data; however, only specific users will have access to view and utilize the data.

Wondering when to buy a SaaS-based WMS system? 

Ideally, SaaS-based warehouse management software is a good option for smaller and less complex business organizations. Here the software vendor will manage all aspects of system performance and provide a core standardized functionality. This may limit the scope for customization of features and the overall flexibility of the model.

One significant advantage of SaaS-based WMS is that your organization gets speedy implementation with full IT and technical support. Most service vendors provide a flat-rate or per-user pricing model that works for companies to get advanced functionality at an affordable cost.

Cloud-Based Warehouse Management Software

In comparison to SaaS WMS platforms, cloud-based warehouse management software resides in the cloud and is hosted on a separate server based on vendor specifications. Most service vendors offer a high level of customization for cloud-based WMS solutions, and you can personalize modules to meet high inventory requirements for seamless warehousing.

Data security is one of the biggest advantages of cloud-based warehouse management software. It ensures that your organization maintains a secure data backup in the cloud to safeguard inventory and supply-related records in case of any mishap or unexpected loss.

Cloud-based warehouse management platforms are comprehensive and have various features that manage and optimize warehouse operations. Most service vendors handle all aspects of implementation and provide complete support to tide organizations through the transition phase so that all employees can use the new system to full capacity.

A one-time investment, cloud-based WMS solutions are fully scalable and can be integrated with key business applications, making them a valuable organizational asset. They are best suited for medium to large enterprises with multi-location offices as they increase data accessibility and task agility.

How To Choose The Right WMS Platform For Your Organization?

With tons of warehouse management platforms available in the market, it is overwhelming to decide which one to implement.

How To Choose The Right WMS

Source: WMS

If you are confused, don’t worry. We have curated a list of important factors to keep in mind that will help you get the best WMS platform:

  • Budget: It is important to have a fixed budget in mind to negotiate with your service provider and get the best deal. Most software vendors have flexible pricing plans, so let them know your budget well in advance and come to a mutual agreement to ensure you don’t overshoot your financial limitations.
  • Customization: Make sure to invest in a credible service provider willing to customize the warehouse management system aligned with your business goals. Most software vendors can include or remove modules based on your requirements to deliver a tailor-made package for your organization.
  • Scalability: It is essential to invest in a warehouse management solution that can grow with your business. You should be able to purchase extra modules and features as the business diversifies, expands in new markets, or handles additional volumes.
  • Customer Support: A good software vendor makes sure to provide life-long support to clients – that is just what you need! Make sure to discuss after-sales support and user training sessions with your service provider to ensure that your employees can adapt to the new system with ease.
  • User-Friendly Interface: Make sure to get warehouse management software that has a navigable visual interface. The system should be intuitive and user-friendly so that all stakeholders can utilize it to the optimum capacity.

Closing Thoughts

One of the greatest debates in the business ecosystem is whether to invest in a SaaS or cloud-based WMS solution. While it is not an easy decision to make, it is imperative to remain objective and oversee all critical aspects before making an intelligent move.

Whatever you choose, be rest assured that implementing a warehouse management system will help your organization practice world-class inventory operations and streamline all related processes. So, go ahead and get the best WMS platform to build your supply chain success story!

Do you have any more questions or tips to share with us about warehouse management software? Do let us know in the comments section below.

Supriya Bajaj
Supriya is a senior content writer with vast experience in writing about technology for various industries. Interactive, synergetic, and influential content is what she believes can make a positive difference in our daily lives!

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