The Ultimate Guide to Warehouse Automation

60-Second Summary

This guide provides a comprehensive overview of warehouse automation, covering its benefits, types, technologies, and considerations for implementation. It discusses both digital and physical automation solutions, including software, robotics, and advanced systems like AS/RS and AMRs, aimed at enhancing efficiency, reducing costs, and improving safety. This guide also outlines steps for planning automation, from goal setting and data analysis to physical space assessment, highlighting the necessity of automation in modern supply chains and offering best practices for successful integration.

Are you considering implementing automation in your warehouse but aren’t sure where to start? This ultimate guide will introduce the different types of warehouse automation and technologies to assist you in choosing the right solution to help your operation successfully meet its goals.

An Overview of Warehouse Automation

Warehouse automation is the process of automating repetitive tasks involved with moving inventory in and out of a warehouse, distribution center, or retail space using equipment, robotics, or software. It streamlines inventory handling to reduce overhead costs and speed up order fulfillment, distribution, or replenishment while driving efficiency and output. Automation can be simple or fairly complex, ranging from using barcode scanners to autonomous robots that aid workers with moving inventory or preparing items for shipping.

Rapid Industry Adoption

With the need for supply chain technology and automation growing to meet rapidly fluctuating consumer and market demand, many companies are implementing automation to some degree in their warehouses and fulfillment centers. According to Research and Markets, the global warehouse automation market is expected to reach USD $33.34 billion from 2022 to 2026 at a CAGR of 13.60%.

Types of Warehouse Automation

Warehouse automation takes many forms, ranging from simple to complex, but the two main types are digital and physical warehouse automation, each of which can be divided into different categories.

Digital Warehouse Automation

Digital warehouse automation is comprised of the software and data used to reduce the need for human intervention and manual, labor-intensive processes.

Digital warehouse automation provides many advantages – faster and more accurate inventory handling, improved security, better data management, reduced operational and legal risks, and improved safety. It can also result in higher profitability and reduced expenses.

Physical Warehouse Automation

Physical warehouse automation consists of robotics, equipment, conveyors, and similar technology to streamline material handling workflows and reduce manual, labor-intensive processes. It provides better warehouse space utilization, improved worker safety, more accurate order fulfillment, improved inventory security, and increased inventory storage.

Implementing physical automation in your warehouse can provide a fast ROI, helping to increase profitability, reduce overhead and labor expenses, and improve customer service and satisfaction. However, to implement this type of equipment in your warehouses or distribution centers, you’ll need significant capital upfront and comprehensive planning beforehand. Physical automation systems will also need maintenance and service to keep downtime at a minimum.

Classifications of Warehouse Automation

Warehouse automation can be broken down into smaller categories, ranging from simple pieces of equipment to complex systems that can use both physical and digital automation technologies. The four main categories are:

1. Basic Warehouse Automation: Basic warehouse automation assists manual and repetitive tasks to move inventory throughout the distribution or manufacturing process. It can include conveyors or carousels.
2. Warehouse System Automation: Warehouse system automation typically combines software and equipment, but can include other elements such as robotics, machine learning, and data analytics to automate tasks and workflows involving order fulfillment, inventory management, shipping, returns processing, or similar applications.
3. Mechanized Warehouse Automation: Mechanized warehouse automation consists of robotics equipment and systems that assist warehouse employees with tasks and workflows to minimize human intervention in repetitive tasks or reduce labor-intensive procedures. An example of mechanized warehouse automation is the OPEX? Infinity? AS/RS, a system with a grid-racking structure where wireless robots retrieve totes containing inventory. The totes are then delivered to a presentation port where an operator can fulfill an order.
4. Advanced Warehouse Automation: Similar to mechanized warehouse automation, advanced warehouse automation combines robotics and equipment with machine learning or artificial intelligence (AI) to completely replace manual and labor-intensive workflows.

Types of Warehouse Automation Technologies

With a wide variety of systems on the market from numerous suppliers, it’s important to know which type is best suited for you and what benefits it provides.

Automated Storage and Retrieval Systems (AS/RS)

Automated storage and retrieval systems (AS/RS) have evolved rapidly into a variety of different technologies since their original focus on heavy pallet loads and mini loads. This type of system has become so popular because it can reduce labor costs, improve space utilization, and increase inventory security while providing a significant ROI. Types of AS/RS technologies are:

• Goods-to-Person Systems (G2P or GTP): A goods-to-person system (G2P or GTP) is the most popular type of AS/RS. Common G2P systems consist of conveyors, carousels, and lift systems that bring goods to workers.
• Unit-Load Systems: Unit-load systems handle heavy loads (usually between 1000-5500 lbs.) of full or partial pallets and cases.
• Mini-Load Systems: Similar to unit-load systems, mini-load systems handle smaller loads of totes, trays, or cartons.
• Crane-Based Systems: These are designed to retrieve pallets or totes using a fixed or moveable crane located in an aisle.
• Shuttle-Based Systems: Commonly a feature of G2P systems, shuttle-based systems deliver inventory using a shuttle, bot, or automated guided vehicle (AGV) that runs on a track within an AS/RS or G2P racking structure. These vehicles deliver totes or trays to a workstation that can be integrated with the system.
• High-Density AS/RS: A high-density AS/RS has a dense storage racking structure that relies on AMRs or AGVs to navigate the racking system to find and retrieve totes or trays.
• Carousel Systems: Carousel systems are similar to conveyor systems, but retrieve and store inventory by spinning until an item is placed or removed.
• Vertical Lift Module (VLM) Systems: A vertical lift module system (VLM) is a fully automated and enclosed structure where an inserter/extractor is surrounded by totes or trays to retrieve and deliver inventory.

Automated/Automatic Guided Vehicles (AGVs)

Automated guided vehicles (AGVs) navigate a warehouse on a fixed path using wires, sensors, or magnetic strips. Since they cannot navigate around people or obstructions, they are ideal for simple warehouse layouts or within a confined system, such as an AS/RS or GTP system.

Autonomous Mobile Robots (AMRs)

Similar to AGVs, autonomous mobile robots (AMRs) navigate a warehouse space, but can do so without predefined routes. To safely navigate a space, AMRs rely on GPS, guidance systems, sensors, and sometimes AI, detecting obstacles and humans to stop or move around them.

Pick-to-Light or Pack-to-Light Systems

Pick-to-light systems utilize lights and digital displays to guide warehouse employees in item picking. These systems can be used with mobile barcode scanning devices or as a feature in AS/RS systems and automated sorting systems to reduce the time spent searching for items and improve item picking accuracy.

Voice-Picking, Voice-Tasking, or Pick-by-Voice

Voice-picking, also referred to as voice-tasking or pick-by-voice, involves using mobile headsets and software to create clear and direct item picking paths for where inventory should be picked or put away. Voice-picking removes the need for handheld barcode and RFID scanners.

Automated Sortation Systems

Automated sortation systems replace the need for traditional put-wall sorting, automatically sorting items according to predefined parameters or for order fulfillment. Automated sorting systems can be used for a wide variety of applications – ecommerce, order fulfillment, in-store replenishment, case-to-aisle, kitting, returns processing, and cross-docking.

Automation Software

There are many different types of warehouse automation and supply chain software available from a wide range of suppliers. Here are a few major software types:

• Warehouse Management System (WMS): A warehouse management system (WMS) is a comprehensive software solution typically used to manage logistics, supply chain, and warehouse operations. It can provide visibility into inventory movement, stock levels, and item location while also facilitating communication between automation solutions.
• Inventory Management Software: Inventory management software primarily tracks inventory throughout an organization’s entire supply chain, providing an overview of inventory and stock levels and sometimes stock availability from suppliers. This type of software is commonly used along with a WMS.
• Order Fulfillment Software: Similar to inventory management software, order fulfillment software handles inventory management activities that are focused on order fulfillment – receiving orders, creating item picking lists, guiding order picking and packing, shipping, and tracking.

Processes Suitable for Automation

Any warehouse activity that is repetitive, manual, or labor-intensive can be automated to increase efficiency, reduce overhead expenses, and improve worker safety. Logistics operations will commonly use a WMS to manage automation and warehouse activities. A few of the major tasks that can be automated to some degree are inventory replenishment, returns, receiving, item sorting, item put-away, picking, packing, and shipping.

Timing of Automating Your Operations

Automating your warehouse with some degree of technology is no longer a luxury, but a necessity to keep up with constantly fluctuating consumer demand and unpredictable supply chain disruptions. If your goal is to reduce expenses, raise efficiency, or even improve supply chain resilience, it’s likely time to automate your warehouse.

Five questions to determine if it’s time to automate your warehouse operations:

1. Are your existing tasks, procedures, and workflows manual and labor-intensive?
2. Does your workforce increase or decrease based on demand during peak seasons?
3. Is inventory data inaccurate or incomplete?
4. Are customer orders delayed due to a long or complex order fulfillment process?
5. Are inventory levels imbalanced from supply chain disruptions?

Considerations Before Implementing Automation

Before implementing warehouse automation, it’s important to consider your operation's needs and what you’ll need to meet your goals. Implementing warehouse automation is no small feat and requires extensive planning, capital, and preparation, depending on the level of automation you choose. It’s important to consider aspects beyond purely financial ones.

• How will implementing automation affect your existing employees or future hiring needs?
• How does automation affect your sustainability goals – will you use less power and resources?

See the top 10 things you should consider before automating your warehouse. Click here to download the ebook.

Warehouse Automation Challenges

Even though warehouse automation provides a range of substantial benefits, equipment can break down or malfunction, causing unexpected downtime that can impact order fulfillment and cause delays. It’s important to account for maintenance costs and have service schedules to keep your equipment up and running at top performance. When choosing a warehouse automation solution, it’s crucial to choose a provider who is involved in the entire implementation process from the initial proposal to service after installation.

Benefits of Automating Your Warehouse

Aside from improving efficiency, increasing throughput, and reducing overhead costs, automating your warehouse has countless benefits and advantages over competitors:

• Increased order fulfillment throughput
• Improved order fulfillment accuracy
• Optimized warehouse space
• Improved supply chain resilience
• Enhanced data analysis and information accuracy
• Reduced workplace injuries
• Enhanced customer satisfaction
• Higher profitability
• Reduced overhead expenses
• Stronger inventory security and visibility
• Increased sustainability practices and less resource use

Warehouse Automation Best Practices

When searching for the solution that’s best for you, it’s important to:

1. Choose a Scalable Automation Solution: With consumer and market demand constantly fluctuating, it’s best to choose a solution that can grow with your business or scale back to accommodate lower demand without impacting existing labor.
2. Ensure WMS Integration: The automation solution you choose should be able to integrate with a WMS system to ensure interconnectivity and communication with all warehouse operations, providing accurate inventory and performance data.
3. Keep Warehouse Design and Space in Mind: The automation solution you choose must be able to accommodate your existing warehouse space (brownfield) or fit the needs of a new fulfillment center or warehouse (greenfield).

Prerequisites for Automating Your Warehouse

As mentioned, warehouse automation takes extensive planning, time, capital, and preparation to implement. If you’re looking to implement a warehouse automation system, it’s best to follow these major steps:

1. Create a Team of Stakeholders
2. Establish Your Goals
3. Collect and Analyze Data
4. Assess the Physical Space
5. Consider the Future

Conclusion

As the global environment is constantly changing and affecting supply chains everywhere, implementing warehouse automation is no longer a luxury, but a necessity to navigate climbing inflation, increasing shipping and logistics expenses, shrinking labor pools, and rising wages. In order to choose the right solution that’s best for you, it’s crucial that you understand the types of automation available to you and what they’ll take to implement.