Making warehouse automation work for your business

Warehouse automation has had what might be best described as a ‘chequered past’. 

Transferring the technology from the world of manufacturing to the world of logistics did not work out as hoped in many instances; the ‘simple repeatable process’ that was ripe for automation on the manufacturing line was harder to replicate in the variable world of logistics.

The companies that have developed the most robust solutions to automation have understood the aspects of their warehouse operation that could be best automated and built around that a flexible, typically manual, solution to cope with the balance of activity.

Building ‘flexible automation’.

Trym worked with a global B2C manufacturer and retailer over a number of years, helping identify how best to deploy automated picking technology into their pick-pack facilities around the world.

The engagement started in the UK, reviewing their existing (predominantly automated) facility and using that as a benchmark to the throughput levels of different types of automation for different product types. Combining this information with cost information (either of labour, or the equipment in the different automated solution) allowed a trade-off model to be built, exploring the relative costs of picking and packing sales forecasts through a combination of manual and automated solutions.

With a base case built and signed off for the UK, this model could then be used to examine how future sites around Europe should be designed.

Local factors.

Not all warehouses are designed equal, and a number of factors; local sales volume, product mix and labour costs, have an impact on what the optimum level of automation should be for a facility. For example, a new facility in Bucharest, Romania, may have a completely different automation footprint to a similar sized facility in Berlin, Germany, because of these external factors.

The model we produced was able to answer such questions, and also produce a pan-European cost-to-serve with different facilities added to the network. The project was then extended into territories – specifically Asia – where local labour and picking efficiencies could be added to the model to explore when automation would be beneficial. This provided a framework of how best to support the forecast growth, and at which point in the growth path automation would be justified.

What this client did particularly well was ensure that whenever an automated solution was deployed, there was sufficient work to be undertaken through that solution to ensure it did not become a white elephant. For a mature businesses, with an established product range, the benefits of automation can be assessed on a ‘like for like’ comparison of automated and manual solutions. For businesses experiencing rapid growth and potentially changing product mixes, the message remains ‘proceed with caution’.

Ultimately, a data-led, analytical and flexible approach to warehouse automation ensures that whatever solution is decided upon, it works for your current and future business needs.

About the author

Jon’s client work extends across Manufacturers and Retailers with a scope that covers high-level supply chain strategy through to detailed operational reviews and performance improvement. 

We are independent supply chain and warehouse consultants who specialise in data analysis, leading strategy, and bringing a fresh perspective to your supply chain challenges.

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