SmartTurn expands the online WMS market

In early 2005, Jim Burleigh and a development team had an idea: Apply the lessons they had learned selling online sales management software at SalesForce.com to the warehouse management software (WMS) industry. The result, which launched in the spring of 2006 at D/C Expo, was SmartTurn, a WMS system offered in a Software as a Service model.

While other companies have offered WMS in an on-demand model, SmartTurn took that to another level, providing its solution for just $500 per month per warehouse. “You can have unlimited users and unlimited transactions,” says Burleigh, CEO of SmartTurn. 

While SmartTurn didn’t land it’s first commercial customer until the second quarter of 2007, today the company has signed up 120 customers and is managing over 175 warehouses. The business model hasn’t changed: It’s still just $500 a month per warehouse plus a one-time $1,500 set up fee, or $7,500 for the first year. “We think of it as commodity WMS,” says Burleigh. “It’s smart, simple and safe. Tongue in cheek, we tell people it’s cheap and easy, which is foreign to most of the installed WMS packages that are on the market.”

I talked to Burleigh yesterday to find out what SmartTurn has learned after the last few years in the on-demand WMS business. “We went into this with a handful of major hurdles we had to overcome to make this work,” says Burleigh.

The first was that on-demand would never work because every warehouse was unique and needed a customized solution. “That’s baloney,” says Burleigh. “Yes, there are differences between warehouses, but they are manageable out of one set of solutions.”

The second was that warehouses would not accept having their information stored on the Web. “No one keeps their money in their desk drawer,” says Burleigh. “Why should it matter if all of their information is on site.”

The third was that the response time is too slow if your using wireless barcode scanners with a web-based application. “I don’t think you’ll ever be able to use our system with an automated conveyor and sortation system,” says Burleigh. “But most of our clients are using wireless handheld scanners in their receiving and shipping departments and it works wonderfully. Information lag time is not a problem.” Burleigh says the system integrates easily with scanning, voice recognition, RFID and pick-to-light systems.

The last was the most likely user would be a small warehouse of 5,000 to 20,000 sq ft and a few operators on the floor. “I’ve been blown away by the number of facilities in the 50,000 to 100,000 sq ft range, especially 3PLs, who are using our solution,” says Burleigh.

Who, then, is the ideal candidate for SmartTurn. Burleigh says most facilities are receiving pallets and picking pallets or cases, which typically means wholesale distribution or third party logistics. About 20% of users, however, are e-commerce sites doing direct-to-consumer fulfillment.

What’s next? SmartTurn is adding Web 2.0 functionality to its solution, including Google gadgets that can be downloaded from the Web to give customers visibility into items that are important to their business.

“There are a good 2,000 to 3,000 warehouses out there that need a Tier 1, best-of-breed solution,” says Burleigh. “But in our opinion, the other million or so can do with something less.”

SmartTurn has about 175 of them now. If Burleigh is correct, there’s a lot of room to grow.