When is Your Operation a Good Candidate for an automated storage and handling system?


Automated storage and handling systems can substantially increase your throughput and storage density capabilities but how do you know if an automated storage and retrieval system will benefit your warehouse operations?  Here are a few things to consider:

When your operation is running 18-24 hours a day, 5 to 7 days a week:

  • Typically single shift operations do not generate enough labor savings to justify converting a warehouse to automation.  However, when a warehouse operates for 18-24 hours a day, the labor savings are 2-3 times, thus creating much greater labor savings when the operation is automated.  Simply, the more you run automation the more it pays for itself.

Finding warehouse employees is difficult or labor costs are very high:

  • If your facility is finding it hard to attract capable warehouse employees or your labor market is expensive, automation may be your only solution to ensuring a smooth running operation.  Automation decreases the number of employees required to operate your warehouse and greatly reduces the risk of not having enough people to properly operate your facility.

Your warehouse is becoming too congested:

  • When you are running out of storage locations for increased storage requirements, or pallet movement/throughput is creating congestion issues, automation can solve both these issues.  Automation typically creates 15-20% more storage in a warehouse, depending on your SKU storage profile.  Automation designed to match your current and future pallet movement creates an organized and efficient warehouse.

Cost to expand/move or use outside storage is very high:

  • When your operation outgrows your current facility, your options are to expand/move or store your product at a 3rd party warehouse but in certain markets or industries (freezer & refrigeration are prime examples) this can be very expensive.  Increasing your storage and throughput capacity per square foot as automation does, can dramatically help to justify buying automation for your new warehouse space.

Running a tall building is hard to do manually:

  • Tall buildings are desirable because they require less land, create more storage per square foot and are more efficient for freezer/refrigeration operations (less heat loss through smaller ceiling surface).  However, they require expensive forklifts and generally decrease operator productivity, making them more expensive and complex to support.  Automation runs at the same rate in a tall building as it does in a standard size building and typically is cheaper on a per pallet cost in tall buildings.

You are storing high cost product:

  • Damage to product in a warehouse (and mistakes made in the picking process) are part of any warehouse operation.  However, when the product you are handling has a high value, the damage and inaccurate picking can really affect your bottom line.  Automatic pallet handling and storage can greatly reduce the occurrence of damage and inaccurate picking, thus helping to justify the move to automation.

You operate a freezer warehouse:

  • Operating storage inside a freezer has limits on what a human can do in terms of duration and efficiency.  Automatic pallet handling can make a freezer warehouse a “black box” from where the pallets are stored or retrieved, and no fork lifts and people have to enter.

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