Warehouse automation – the challenges and benefits

Warehouse automation has been a hot topic for several years. Each time, there are more and more facilities being built all over the world which are designed to store even tens of thousands of pallets and require only a few people to operate them. Everyone sees the huge potential of automation, although, there is still a challenge to overcome – creating an autonomous warehouse is a gigantic investment. However, the direction of change has been set and there is no turning back. According to the proverb, you find yourself between a rock and a hard place – invest to survive or don’t invest and cease to exist.

Although automatic machines and robots are expensive, more and more often they are replacing people in performing the most onerous, monotonous and often also dangerous tasks. 

Expensive automation, cheap operation 

Automation even in one spot may be expensive. The purchase of an autonomous forklift and preparation of a suitable working environment in the warehouse costs much more than employing a forklift operator. The upfront costs of implementing picking robots is similarly high. And this is just a foretaste of the enormous investment required to create a fully automated facility. As in most cases, adapting existing buildings is not an option so they have to be built from scratch. Construction works, installing equipment and commissioning are not only costly, but also financially risk.

Do the arguments above suggest you shouldn’t automate your warehouse? On the contrary! Warehouse automation pays off quickly. It starts to bring real savings in the short term. Automatic machines generate only maintenance, repairs and electricity costs instead of labor costs which often rise quickly, as there are less and less countries in the world offering cheap labor (which is a good trend!). It is also worth emphasizing that violation of workers’ rights and paying starvation wages in countries with low economic development may turn off customers. 

More and more people expect both large corporations and small family businesses to follow the principles of Corporate Social Responsibility (CSR). Which means, among other things, respecting workers’ rights, offering decent wages and creating a safe working environment. However, these requirements do not apply to machines which may work without pay 24/7 for 365 days a year with only short breaks for maintenance and repair. They are not affected by dust or poisonous gases and may withstand extreme temperatures. They do not have accidents, do not get tired and do not lose concentration. 

Automation speeds up warehouse processes 

Automation is especially beneficial in warehouses with a high rotation of goods. The ability of the machines to perform a task repetitively with precision may significantly speed up warehouse processes – the stock in, stock out and  internal transport (horizontal and vertical movement) and make them also much more predictable. There is no possibility of confusion about the location or loss of cargo. There are practically no losses related to damage or destruction of goods during transport. 

Automation also makes sense for warehouses with low rotation of goods but with difficult working conditions. This applies, for example, to places with a risk of explosion or with extreme temperatures, i.e. primarily cold stores and freezers. The rationale for the use of automatic machines is also the necessity to handle particularly high-value loads for which physical protection and constant monitoring are necessary. The use of robots and automatic machines reduces the risk of unauthorized access.  

Automatic warehouse may add to your competitive advantage 

Producers and traders competing in the global market are looking for any and all possible ways to build a competitive advantage. In practice, this means, first of all, cost optimization and speeding up order fulfillment. It is extremely difficult because the costs of electricity, fuel, raw materials and labor are constantly rising. Automation is one of the few areas still with unused potential. It applies to production processes, but also to warehouse processes. A warehouse that is cheap to operate and independent of the economic situation in the local labor market, can be a development opportunity and a chance to increase the company’s competitiveness.