Comparison
| Criterion | ERP | WMS |
|---|---|---|
| Purpose | Manage purchasing, sales, finance and accounting | Execute and record the physical work of the warehouse |
| Inventory control unit | Product by warehouse, with its value | Product by location, lot, serial number and pallet, with its status |
| Users | Purchasing, sales, finance, management | Operators, supervisors and warehouse managers |
| Where it is used | On a computer | On the handheld, on the floor, and on a computer |
| How data is captured | Documents typed or imported | Barcode or RFID scanning |
| What it validates | Accounting and tax rules | Location, lot, expiration date, serial number and quantity at each step |
| Result | Financial statements, invoices, inventory value | Accurate stock by location and movement history |
What the ERP does
The ERP is the record of the business. Purchase orders and sales orders originate there, invoices are issued there and inventory cost is calculated there. Its inventory module records how many units of each product are in each warehouse and what they are worth.
What the WMS does
The WMS is the record of the warehouse. It records which location holds each item, with which lot and expiration date, and it directs each operator: what to receive, where to put it away and which location and lot to pick for an order. Each step is confirmed with a scan, so the record matches physical stock.
How they connect
Three types of information are exchanged between an ERP and a WMS:
- Master data, from the ERP to the WMS: products, suppliers, customers and warehouses.
- Documents to execute, from the ERP to the WMS: purchase orders to receive, sales orders to pick and transfers.
- Confirmations, from the WMS to the ERP: what was actually received, shipped or transferred, with lots and serial numbers, and count adjustments.
With that division, the ERP remains the source of orders and of the inventory value, and the WMS the source of the work executed on the floor. Each document is recorded once, without duplicate entry.
Examples with SAP Business One and Odoo
- SAP Business One: the purchase order is created in SAP; the warehouse receives it on the handheld, and the WMS posts the goods receipt PO in SAP against the same order and line, so that SAP closes the order. See Chainlink with SAP Business One.
- Odoo: Odoo creates the receipt for the purchase; the WMS executes it, writes the quantities, lots and serial numbers on the same transfer and validates it. The pending quantity remains open in Odoo for the next delivery. See Chainlink with Odoo.
When the ERP inventory module is sufficient
Not every warehouse needs a WMS. The ERP inventory module is usually sufficient when:
- The warehouse is small, and one or two people know where each product is.
- Products have no lot, expiration date or serial number.
- Stock does not need to be controlled by location.
- Picking errors and inventory discrepancies are infrequent and low in cost.
When the warehouse grows, products have expiration dates, several people pick at the same time or discrepancies start to be costly, the lack of locations and scan validation is what the ERP module does not solve.
How Chainlink WMS integrates
Chainlink has a REST API in every plan and connectors for SAP Business One, SAP S/4HANA, Odoo, Microsoft Dynamics 365 Business Central and ERPNext as an add-on for Professional and Enterprise, with setup assisted by BW. See integrations.