Many companies today know they need a warehouse management system (WMS) or an upgrade to their existing system. But often it's not as clear how to choose, and more importantly, how to justify the cost of a new system.

"Warehouse management systems range in price from under $100,000 to over $1 million," Brian Smith, vice president of North American sales for LIS (www.lis-online.com ) said at a D/C Expo seminar last month. "At the end of the day, everyone has to put down a cost justification plan for their proposal."

Smith and Bob Carver, LIS' vice president of marketing, walked users through the basics of today's WMS systems for Tier I, II, and III users.

"Not all WMS systems are equal," Smith said. "It's important to understand the different functionality at different price points and compare those to your needs. Maybe you don't need a $1 million system."

The pair then presented a methodology that allows WMS users to identify their major problem areas, estimate how much those problems are costing them, and determine how much a WMS will help them save on those problem areas.

"Most distribution managers know in their gut that there's room for improvement," Smith said. "With these tools, they can quantify those improvements and tell management why a new WMS system is worth the investment."