Surveying the software landscape

Multichannel merchants shopping for direct and retail systems have long complained that there were few choices in terms of vendors and their offerings. But this has changed in recent years, as some new and impressive systems competitors have emerged.

Some e-commerce platform providers are expanding offerings into order management. Enterprise-wide systems are starting to be installed more widely in this market niche. And there are multiple choices to manage the warehouse and supply chain. These are just some of the trends we see emerging that give software buyers many realistic choices. Here are some new systems options for multichannel merchants.

E-commerce to order management

Several e-commerce system providers are expanding from Website development into order management and on into fulfillment. In some cases this is driven by competition, and in others it's a logical extension of functionality.

What's interesting is that the bricks-and-mortar retail industry, which has generally favored in-house, licensed software options, has been willing to embrace services, including e-commerce, Web development and hosting, point-of-sale, help desk functions, and so on.

GSI Commerce acquired NewRoads, a call center and fulfillment third-party logistics provider in 2007. The company's service offering now spans from e-commerce through fulfillment.

In the Micros-Retail family, Fry — the provider to many top e-commerce companies — has integrations to CommercialWare's Order Management Suite, Serenade. Fry also has a service offering for call centers with Convergys, a player in call center outsourcing.

The Micros acquisition of CommercialWare, eOne (e-commerce software for small- and moderate-size direct businesses) and Fry rounds out its multichannel POS and store offerings. This synergy is apparently paying off: The fiscal year ending June 30, 2008, was one of record sales for Micros and Micros-Retail.

Another provider worth looking at is Vcommerce Corp., which counts Target and Overstock.com as clients. The vendor's software offering includes e-commerce and a solid order management solution.

Several e-commerce companies are extending functionality to include call center and customer service. A reasonable number of customer calls overflow from the Website as customers seek answers to their product choice, inventory availability and offer questions. And many customers are wary of submitting their credit cards in an online shopping cart.

One of the biggest benefits to this expansion in scope — whether a service or a licensed product — is that it can eliminate some of the most complex integrations between a Website and business systems, involving business rules, inventory availability, pricing engines, etc.

But in many cases, these new offerings do not offer the fulfillment system functionality that is required for warehousing functions. So users will require a warehouse management system for backend fulfillment.

WMS, WCS or SCM systems: Which do you need?

Assuming that your order management or ERP system does not have fulfillment functionality or can't meet the more complex needs of your warehouse or supply chain, there are three categories of software to consider: the warehouse management system (WMS), the warehouse control system (WCS), and the supply chain management (SCM) system.

Keep in mind that order management and fulfillment systems may be less robust than a full-function WMS. A warehouse management system is a key component of the supply chain, as it manages the four-wall inventory location and movement throughout the receiving, checking, stock put away, replenishment, picking, packing and shipping processes, and the returns department and processes.

Work order systems are available to assemble kits and sets in the production process. They also help schedule labor and report on productivity.

WMS often provide and use barcode scanners, mobile computing devices, and radio frequency for real time data capture. A WMS generally does not have the advanced software drivers required to manage workflow and material handling equipment (MHE). Workforce management systems interface to enterprise (ERP) or order management systems, which pass down to the WMS orders for in stock, pickable product.

How do you choose? Very carefully, as there are hundreds of tier 1, tier 2 and tier 3 WMS vendors, and their systems are available with varying functions and costs. But many of these WMS do not have small-order pick, pack and ship fulfillment industry experience.

A WCS is generally imperative where there is advanced MHE that must be interfaced between the order management or warehouse management systems. The WCS directs automation of conveyor lines, shoe or tilt-tray sorters, automated packaging systems, palletizers, etc. Some WCS vendors say they plan to add more WMS functions to their future offerings.

SCM systems encompass the movement and storage of raw materials, work in process, and finished goods from the point of origin to the customer's home, place of business or stores. Manhattan Associates offers broad and deep functionality in this area, including:

• Warehouse management
• Retail, e-commerce, catalog and wholesale SCM planning, forecasting and inventory management optimization
• Multiwarehouse inventory management and order fill rules for distribution centers, by region or from-store fulfillment.
• Inbound and outbound freight management
• Labor management and slotting
• Workflow management

System choices often revolve around IT platforms. Manhattan Associates offers three levels of product offerings that cater to major IT hardware and software platforms: Microsoft.net, iSeries, and Open Systems.

While the offering is not identical for all three platforms — resulting in different license costs — Manhattan makes much of the full functionality available to a wide range of company sizes and number of users.

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