Warehouse automation has a direct impact on Logistics in many ways, affecting the way we design and manage warehouses. Today, there is great interest in the positive impact of automation. It is estimated that by 2025, 50000 warehouses around the world will use some form of automation system. As it becomes more and more popular, many people are analyzing the challenges and advantages of this new trend of logistics.
In this article, we will study these problems in more detail.
● challenges of warehouse automation
● cost of warehouse automation
● key benefits of warehouse automation
● benefits of warehouse automation to third parties
Challenges of warehouse automation
The impact of warehouse automation represents a change that, like any change, brings challenges. Automated warehousing and logistics requires time and effort to start and operate, as well as experience and stable hands to guide and maintain the system when it is implemented. When considering automation, you may encounter some obstacles, such as:
● lack of knowledge on how to automate your warehouse, distribution center or manufacturing plant.
● possible downtime during conversion.
● lack of in-house expertise required to maintain such systems.
● capital required for investment.
However, if implemented properly, these obstacles need not be a problem. For example, if you choose to work with automation partners, you will gain the experience and security of working with experts in the field of automation who know how to evaluate the warehouse, how to maintain existing systems, and how to advise you on best practices.
Integrated warehouse automation system
In addition, it is clear that the initial cost of equipment and software is rewarded over time by increasing production and efficiency. With the right planning and foresight, you can fully meet the challenges of warehouse automation. Your business can implement, for example:
● maintenance plan to ensure that automated machinery always operates at the highest performance.
● provide services in cooperation with third parties.
● regularly audit inventory and internal processes to check the accuracy of automation.
Every automation challenge has an appropriate solution, which means you should never deny automation without proper consideration. The first major automation challenge many people face is cost. What is the cost of warehouse automation?
Cost of warehouse automation
The costs associated with automated warehousing and logistics will vary greatly, depending on the system the company ultimately decides to implement. For example, the costs associated with investing in automated guided vehicles (AGVS) are always higher than traditional forklifts, but may not be as expensive as a complete automation system considering the entire warehouse process. In addition, as AGV is the fastest growing type of warehouse automation, the price of AGV is expected to be more and more affordable.
It is estimated that labor costs can account for 65% of the total cost of the warehouse. There are also costs associated with warehousing, energy, packaging, employment, welfare, administration and many other key processes, all of which will increase. So what can you expect in terms of the cost of warehouse automation?
Physical applications and process based solutions can have different price tags. Any associated costs will be directly related to the complexity of the task. If you are looking for end-to-end automated warehousing and logistics and need software and hardware, our suggestion is to find a price that can ensure the quality and efficiency of the solution.
We understand that the cost of automation can be daunting. However, they are quickly amortized by the strategic benefits gained through automation itself.
Like many other types of embedded technologies, automation solutions should not be seen as a one-time investment, but as an investment with guaranteed return on investment.
Key benefits of warehouse automation
You will gain many benefits by automating in warehouses, distribution centers, or manufacturing facilities. An automation project will enable you to solve problems such as insufficient warehouse space or poor management, labor shortage and short delivery time.
The main benefits are:
(1) Productivity improvement
The most common errors in the warehouse are caused by human errors. They just happen, but in the end it takes time and money. Automation alleviates these problems by providing tracking and visibility throughout the internal distribution chain.
Automated warehouse logistics ensures that the flow of goods and materials is traceable throughout the warehouse, which means less products are lost, wasted or sent to the wrong place. With such instant visibility, the answers to queries will be easier to find and the evaluation will be more accurate.
Due to warehouse automation, you can also save some manpower. Automation that can be applied to warehouses of any size helps reduce the need for labor, which means that operators can focus on higher value-added tasks and their execution can continue overnight.
Boring and labor-intensive work is done by machines such as AGV, which operate more accurately. This means that key processes, such as product retrieval and inventory management, can be carried out in a short time. But these are not the only processes that can see productivity gains.
For example, there are also improvements in warehousing. In the traditional warehouse environment, the operator will store, which may lead to human error. However, by automating this process, warehousing becomes more efficient. Another improvement relates to better cross docking management, which means that products can be processed and placed in distribution areas rather than stored in warehouses.
Similarly, the replenishment process has also been improved. Automation makes inventory tracking more visible, so when an inventory item reaches a specified nominal level, the automation software will issue a requisition, which will be marked for approval.
This not only means that the warehouse will rarely be out of stock of certain products or materials, but also there will be no possibility of over ordering inventory. This is a good example. We call it just in time production.
(2) Reduce costs
The direct benefit of automation is the rapid reduction of cumbersome manual operations. By readjusting the work of operators to engage in higher value activities, the company will see more immediately profitable work completed.
The inclusion of automated processes will save money by supporting labor in times of high demand, where employees may have to work overtime in the past. In addition, it will save costs in the following aspects:
● injury reduction and compensation
● reduced damage to goods
● reduced energy usage due to optimized material management
● reduced handling and storage costs
● improve resource allocation
● improve data accuracy
● reduced inventory shrinkage
● improve delivery efficiency
Third party benefits of warehouse automation
When implementing automated warehousing logistics, it is not only the warehouse itself that benefits, but also other stakeholders.
Improve supply chain relationships
Warehouses, distribution centers and manufacturing facilities: all depend on the continuous flow of goods and raw materials. When they have a better view of their inventory level, they can actively order new products.
Supply chain partners will not be left behind when they need to deliver huge orders as soon as possible. The supply chain can better expand its scale to meet the market demand, whether on a daily or quarterly basis.
Improve customer satisfaction
When the orders are fulfilled accurately and delivered on time, and the operation efficiency is ensured through the powerful warehouse automation system, the company can better meet the needs of customers and maintain customer satisfaction.
With better warehouse management, the company can ensure the provision of popular services, such as next day delivery and accurate item tracking.
sustainable development
This is a word in the hearts of many enterprise managers today. When it comes to more environmental protection, facility management has always been an area of concern. Fortunately, automation brings warehouse managers closer to optimizing energy use by controlling where materials are placed, how they flow, and how much goods are needed.
Similarly, with the improvement of visibility of material use, other processes, such as recycling or reuse, can also be included.
With such broad benefits for both core enterprises and third parties, you may consider implementing automation. To determine if automation is right for you, we encourage you to do the following quick tests.
