Thanks in part to the IT slump, warehouse management system (WMS) software vendors are under more competitive pressure than ever before. The result is that the size of the average WMS deal was smaller last year than in 2000. So how much does that WMS cost today?

According to Steve Banker, director of supply chain research at ARC Advisory Group (www.arcweb.com) it depends on the size and complexity of the order fulfillment requirements.

A system designed for a typical high-volume, Tier 1 warehouse or distribution center is currently running about $550,000 from the WMS vendor. Of that total, $190,000 goes to software licensing fees and $360,000 to implementation costs charged by the software provider.

A system designed for a typical Tier II warehouse or distribution center is running about $290,000. Of that total, $110,000 goes to software licensing fees and $180,000 to implementation costs charged by the software provider. But remember, cautions Moe Trebuchon, a partner with PWC Consulting (www.pwcglobal.com): the price you pay for licensing fees and services is only part of the cost of implementing a WMS system. Hardware costs, integration costs, and training costs can cost twice the licensing fee.