Warehouse automation combines technologies like scanners, conveyors, sorting systems, and robotics. It provides flexible frameworks that enable quick responses to changing circumstances. An automation strategy helps companies use their resources efficiently. It brings benefits like error rate reduction, increased productivity, and speed. Moreover, it offers improved storage density/utilization of space and standardized work processes.
Automated logistics systems minimize supply chain disruptions
Automated systems, such as robots and AI-driven software, enhance inventory management, allow real-time tracking, and reduce human error. This leads to faster order fulfillment and better response times to demand fluctuations. Moreover, integrating automation eliminates dependency on manual labor, which is affected by workforce shortages or labor disputes. Automated warehouses maintain steady output levels by maximizing workflow and increasing accuracy. This keeps the supply chain strong during unexpected disruptions.
Integration of robotics in the warehouse performs error-free, repetitive actions with no negative impact on quality. There is no need for salary or breaks, resulting in lower operating costs. Moreover, IoT technologies allow businesses to share information about packaging and shipping, minimizing errors and waste. In addition, blockchain technologies help to keep the operations transparent and traceable. According to Roland Berger’s report (2016), robots are six times more efficient than human workers and can reduce 20–40% of cost.
Dematic stated that KION GROUP AG, its parent company, acquired Digital Applications International Limited in March 2020. DAI’s addition significantly widened the company’s intralogistics software offerings, encouraging the distribution, storage, and movement of goods throughout the entire supply chain. Its core product, which is a warehouse management system, broadens Dematic iQ’s automation capacities by allowing a larger range of applications—from initial manually operated functions to fully automated supply chain operation. Furthermore, the combination of products was specifically attractive to new customers who wanted a single software platform. It was also appealing to the customers looking for an updating their current software.
Cost reduction through utility and fast ROI
The dramatic rise in e-commerce shopping resulting from the COVID-19 pandemic led to a notable expansion of the warehouse automation market. It is projected to garner a revenue of $57.6 billion by 2031, growing at a CAGR of 15.3%. Consequently, the requirement for logistics and warehouses facilities also increased for balancing limited expenses with shipping operations.
This is the reason why numerous warehouse managers have turned to automation. Although the initial costs for software automation and robotics seem overwhelming, they have a lesser investment entry point than most people expect. The fast ROI and exceptional usefulness of the recent warehouse upgrades can notably reduce costs and improve productivity.
The rise in robotics as a service has also changed the automation landscape. RaaS minimizes the cost of entry for business owners who want to adopt automation solutions. In addition, it offers flexibility of scaling their operations rapidly and seamlessly as the dynamics of the market and client preference change. For instance, Plus One Robotics creates vision software that provides robots with the hand-eye synchronization required to choose and place different objects in warehouses and distribution centers. The company’s platform allows one human worker to administer almost 50 robots anytime from close or remote locations. This boosts the robot’s capacity to manage exceptions, keeping a minimal downtime, allowing 24/7 fulfillment, and markedly reducing labor costs.
A study by the Aberdeen Group found that organizations implementing warehouse automation witnessed a 25% increase in order accuracy and a 20% reduction in labor costs. Enhanced efficiency leads to faster order processing and fewer errors, lowering operational costs.
Amazon and Honeywell’s integration of warehouse automation
Amazon announced that it had acquired Kiva Systems, a leading robotics company and pioneer of material handling technology, in March 2020. Known to employ automation in its fulfillment centers for a long time, it is ambiguous how Amazon was expected to add Kiva technology in its operation, but the apparent implications of the contract were interesting. This acquisition significantly boosted Amazon’s logistics capabilities, enabling the company to automate its fulfillment centers and enhance its overall supply chain operations. The $775 million deal also marked an important step in the company’s strategy. Leading retailers like Estee Lauder, Sax Fifth Avenue, Staples, Toys R’ Us, GAP uses Kiva technology to facilitate the product distribution to their physical network of stores. They have also been the preferred technology for e-commerce outfits.
Honeywell completed an acquisition of Intelligrated in 2016, which is worth $1.5 billion. The company was held privately and was announced in July to be a leader in warehouse automation solutions and supply chain management, held privately. Its supply chain and logistics solutions included palletizers, software, automated storage and retrieval systems, robotic solutions, and tote-handling systems. The undertaking was integrated into Honeywell Safety and Productivity Solutions. Intelligrated’s co-founder Chris Cole, who reported directly to Waldron, led the business. Honeywell Safety and Productivity Solutions provided technology that improved enterprise performance, enhanced workspace security, and enabled innovation and greater product design. Customers relied on the connected solutions of the company to boost work productivity, enhance operational intelligence with data-driven insights, and provide real-time safety intelligence.
Concluding thoughts
Robotics, IoT, and AI streamline operations in warehouses. They eliminate human errors and enhance productivity, leading to substantial cost savings. The rise of robotics-as-a-service further lowers barriers for businesses seeking to adopt automation. Major acquisitions and collaborative efforts from industry leaders are expected to motivate operational strength and competitiveness in an increasingly dynamic market in the upcoming years.
✍ **𝑨𝒓𝒕𝒊𝒄𝒍𝒆 𝒘𝒓𝒊𝒕𝒆𝒓: Saranya Ganguly
