When Warehouse Automation Does, and Doesn’t, Make Sense (Part 2)

October 16, 2018 by Amware Fulfillment

In last week’s post, we offered up five questions your company could use as a litmus test for determining whether or not to invest and use more warehouse automation. This week, we’d like to offer you four more – and clue you in on where we at Amware stand on the "fully manual” to “fully automated” continuum….

How much of a challenge are you experiencing in finding – and keeping – good people?

Like it or not, our industry is in the midst of a huge labor shortage, and all signs point to that shortage getting worse rather than better.  By contrast, there’s anything BUT a warehouse automation shortage.   So if your fulfillment center is located in a tight labor market or has experienced high degrees of employee turnover, it may behoove you to consider automating at least some of your manual activities. 

It could be the key to helping you handle massive order surges more reliably, especially when you consider that machines rarely call in sick, get injured, or ask for several weeks of vacation during the peak holiday shipping season.  

Have you considered all the costs?

Dr-Evil-one-millionWhen it comes to order fulfillment automation, it’s easy to assume that its sticker price is the final price.  However, nothing could be further from the truth.  As you calculate your ROI, make sure you factor in the cost to install and implement your new piece of equipment, including integrating it with your existing WMS or other systems and getting the personnel who will operate it up to speed.

In addition, don’t forget to account for the expense associated with maintenance and repairs, because both will eventually be necessary.   And if you think you might move to a different facility anytime soon, bump the price up another 50%, because some adaptation will be required. 

Have we weighed all of the possible benefits?

Most companies pursue order fulfillment automation in order to increase their picking speed or capacity.  But that doesn’t mean that there aren’t several other potential advantages that also deserve to be included in your final analysis. 

For example, don’t underestimate the huge role that warehouse automation can play in improving order accuracy and customer satisfaction.  After all, it takes a lot of time and money to rework an improperly filled order before it goes out the door, and that doesn’t even begin to take into account how much you’ll pay for returns – and quite possibly, lost business – if that inaccurate order actually reaches your customer.   In a similar vein, bear in mind that some forms of automation, like a WMS, can provide you with significant amounts of data about where time is really being spent – insight that could lay the groundwork for dramatic process improvements and cost-savings later down the line.

So, don’t dismiss an automated solution as not worth your while simply because it won’t deliver big results in one key area.  There may be bigger-picture advantages that are equally valid.

Are we trying to automate too much, too soon?  Or, have we considered taking a more scalable approach?

While it’s true some forms of order fulfillment automation are highly elaborate and can cost millions of dollars, the operative word is “some.”  

There are also many kinds of automation that can help you take your fulfillment and productivity to the next level without requiring a major cash outlay.  And it often makes good business sense to explore those options first. 

In fact, here at Amware we strongly advocate a modular approach to automating your fulfillment. While your business is gaining traction, that may mean a predominantly manual approach supported by a Warehouse Management System (WMS). As order volumes increase, it may make sense to incorporate other forms of automation like box erectors, auto tape machines, or poly-bagging with print-on-bag technology.  Finally, as your business matures and requires high-volume, high-velocity picking and shipping, a move to automated/smart conveyors and highly advanced options like voice picking makes sense.   

The idea behind this approach is it allows your company to deploy systems and automation when (and only when) your volume dictates.   As a result, you can funnel available cash to wherever it’s most needed and avoid getting tied into inflexible processes or investments that may not be a good fit for your business as it grows.  (For more about this scalable emphasis and why it’s important, check out our eBook Can Your Fulfillment Operations Scale?)

Much like Elon Musk and Tesla eventually discovered, the best answer to manufacturing challenges was a combination of machinery and manual labor. Your decision to deploy warehouse automation doesn’t have to be an all-or-nothing kind of thing – or fully set in stone.    Nor does it have to have to be done in-house.  Fulfillment specialists like Amware already have tools and technologies in use at multi-client warehouses, including many you might not have considered.   Contact us today to arrange a discussion.

Can Your Fulfillment Operations Scale?  Poor choices at the start can undermine long-term growth. Download our free white paper.

 

Filed Under: Logistics Outsourcing, Scalability, B2C Fulfillment, eCommerce Fulfillment