Warehouse management has historically been a challenge for supply chain professionals, linked to a host of external variables including logistics, technology, commodities and the state of the global economy.
Modernization has brought additional challenges like an increased emphasis on customer satisfaction, Amazon's game-changing supply chain and warehouse processes, and an overall shift toward omni-channel retailing and fulfillment. The COVID-19 pandemic has also recently added complications to the already challenging puzzle of warehouse management.
Warehouse automation technology is a logical solution for many businesses grappling with a growing number of responsibilities when it comes to running and optimizing their warehouses. Managers are tasked with handling increasing volumes of inventory and materials, maintaining and upgrading outdated equipment technologies and trying to reduce costs while maximizing productivity.
Businesses also need to manage their employees in an industry with statistically massive turnover rates. Data from the Bureau of Labor Statistics shows that warehouses experience a whopping 36 percent worker turnover rate, on average.
Warehouse Automation Technology to the Rescue
Warehouse automation solutions give managers the tools they need to achieve greater outcomes with less effort, through the use of technology. A comprehensive automation offering will be scalable, intuitive to use and will enable efficiency and transparency among all warehouse systems.
It also can increase customer satisfaction because of automation’s inherent efficiencies. Not to mention the reduction in human error. Automation frees up warehouse workers to focus on higher-level and more challenging tasks, which improves morale and lowers turnover and churn rates, too.
Automation solutions also generally provide a quick return on investment (ROI), typically within months.
Essentially, warehouse automation is the single most important way for businesses to dramatically improve their warehouse management.
Some of the key elements of warehouse automation today include:
1) Automated mobile data collection
Automation helps increase inventory data accuracy and productivity by eliminating tedious manual capture and input processes.
2) Inventory management control
Comprehensive software offers better inventory control as well as real-time visibility of stock levels, storage locations and product information.
3) Warehouse management systems (WMS)
WMS solutions provide direct receiving, putaway, picking, packing, shipping and space utilization information along optimized routes. This streamlines and accelerates all of these important warehousing tasks.
4) Automated storage and retrieval systems
These can include cranes, enabling stock to be stacked vertically for higher storage densities and improved space utilization. Conveyors and automated vertical carousels may also be used to move stock and improve space optimization.
5) Industrial robots
Robots are increasingly being used for palleting, de-palleting, packaging, commissioning and order pickup. They are also capable of identifying and tracking containers using barcodes and RFID tags.
6) Radio data terminals
These terminals are usually handheld or truck mounted and use radio to connect to logistics automation software. They provide instructions to operators moving throughout the warehouse and often have barcode scanners to enable identification of containers quickly and accurately.
Warehouse Automation is Inevitable
Warehouse automation technologies are the clear path forward for the supply chain industry. Thousands of businesses are already making investments, and ResearchandMarkets.com forecasts the market will more than double over the next few years to account for an estimated $27 billion by 2025.
That rapid expansion is being attributed to overall growth within the e-commerce industry along with the emergence of multi-channel and omni-channel distribution systems. Other factors include the globalization of supply chain networks, the growing popularity of micro-fulfillment centers, and the rise of autonomous mobile robots along with increased demand for same and next-day delivery.
As mentioned earlier, Amazon has had a profound effect on the warehousing and supply chain industries. The company has been an early proponent of automation, which has further driven growth and uptake in the market. According to ResearchandMarkets.com, Amazon Robotics has automated the e-commerce giant's fulfillment centers with more than 100,000 autonomous mobile robots. That number is up this year by more than 300 percent, from just 30,000 at the end of 2015.
The research also indicates that fully automated solutions can reduce warehouse labor costs by up to 65 percent, while reducing logistics-related spatial use by up to 60 percent. Automation also increases maximum output capacity at the same time, making it a truly worthwhile investment.
It's clear that warehouse management is in a state of flux and growth, and automation has a major role to play now and moving forward. As managers seek to streamline costs, improve productivity, decrease worker churn and better serve customers, they need flexible, scalable and affordable solutions. Warehouse automation technology offers those capabilities and more, making it a compelling investment and a necessity for any warehouse hoping to remain competitive in the rapidly changing supply chain world.
This post is the first in a seven-part series on warehouse automation. Our next piece will define warehouse automation technologies in more depth, explaining their uses and benefits for overall warehouse management.