Navigating the Automation Landscape
In the contemporary landscape filled with buzzwords and trending topics like robots, RaaS, and automated guided vehicles, prominently featured in trade publications, customers now find themselves more perplexed than ever. The questions loom large: which technology should be adopted, when should it be implemented, how can technology be scaled effectively, what’s the cost implication, and what kind of return on investment (ROI) can be expected?
Amid the allure of a fully automated warehouse, where robots pick products and place them onto automated guided vehicles bound for the shipping area, where a second set of robots packs and stacks them, the concept seems undeniably alluring. Yet, the reality is that not all warehouses are primed for this high-tech transformation. In fact, embracing such technology prematurely might inadvertently hinder operational efficiency.
These insights stem from our hands-on experience. As a pioneering material handling systems integrator, we have successfully executed over 500 projects for industry giants in retail, e-commerce, and distribution over the past 27 years, resulting in a wealth of knowledge.
The Crucial Role of Data Analysis
Before delving into the realm of automation solutions, or any solutions for that matter, our starting point rests on delving into our clients’ data. Data serves as the ultimate informant about operational nuances, and our unique three-step data analysis strategy, bolstered by AI and a team of design engineers, guides us to the most fitting solutions. Occasionally, this translates to full automation, at times partial automation, and often, it entails enhancing existing setups. Each approach hinges on a 24-month ROI calculation, with our average being 17 months.
In the data realm, we embrace the philosophy that more is better. We hunger for insights on building layout, inventory reports, granular product movement data, and every iota of item information we can amass.
Don’t misconstrue our sentiment; our fascination with automation is unwavering. Nevertheless, its deployment demands precision timing and meticulous execution. Missteps in this arena could lead to bottlenecks within the fulfillment process or substantial cost burdens. Furthermore, when introducing automation or material handling equipment, the primary question arises—where will it fit? The universally acknowledged scarcity of floor space underlines the significance of each square foot. Consider a scenario: if we reconfigure your facility and provide 10,000 to 20,000 square feet of additional floor space, priced at $300 per square foot, the savings on a replacement cost basis comes to $3 million to $6 million respectively.
Vertical Potential: The Z-Axis Revolution
Distribution centers have excelled in optimizing floor space, yet the same cannot be said for their vertical space. Here at LD Systems, our thought leader, Bob Sutphen, unveiled the “Z-UP” concept. While geometry lessons recall the x and y axes, the Z-axis, the often-forgotten third dimension, proves pivotal. The Z-axis signifies the vertical space within your facility.
Given the preciousness of floor space, ascending vertically can magnify storage capacity twofold or more within your warehouse or distribution center. This cost-effective strategy avoids leasing or acquiring additional structures and, in isolation, elevates productivity, safety, and storage potential. A fraction of the cost mentioned above.
Prior to diving into the realm of robotics, automated guided vehicles, or AS/RS systems, we suggest a preliminary examination of your current layout and space utilization, encompassing the Z-axis. Only then should your company’s data be combed through to make wise choices. If automation stands as the logical next step, then embrace it wholeheartedly!
Embracing the Automated Revolution
As a Material Handling Products System Integrator, our solutions revolve around three main principles: optimizing space utilization by 20% to 60%, increasing productivity by 20% to 60%, and improving order accuracy to a staggering 99.9%, all while guaranteeing an equipment ROI within 24 months.
Currently, we are immersed in automating a leading Master HVACR Distributor. Their journey started in 2019, after moving to a new building. Their previous vendor misjudged storage needs by a substantial 50%. Our intervention encompassed the addition of storage units, conveyors, two mezzanines, and a vertical lift. In totality, we doubled their item-carrying capacity, almost doubled storage, and redoubled throughput. The integration of self-driving forklifts followed, culminating in our ongoing endeavor to automate their facility and increase their shipment volume by a remarkable 120%.
For deeper insights into our several of our projects, visit www.ldslc.com.
Empowering Progress with Automation
If you’ve visited PROMAT or MODEX over the past years, the spectrum of automation options was everywhere. From on-demand packaging and autonomous forklifts to robotic pick arms and AS/RS systems, the pickings were ripe.
Recently, a 2023 automation study surfaced, revealing that surveyed companies were poised to revamp or embed various automation equipment. The quartet of pocket sortation, A-frame picking technologies, robotic picking, and automated guided vehicles emerged as the leaders of this movement, align with what we notice.
Pay-Per-Pick and RaaS: Innovative Payment Approaches
In sync with the rapid rise in fulfillment automation’s popularity, innovative financial models have emerged. Notably, Robots-as-a-Service (RaaS) and Pay-per-pick have gained prominence.
RaaS represents a business strategy wherein robotics companies lend their robotic assets through subscription-based arrangements. As the allure of robotics surges, a growing number of companies recognize RaaS’s merits in risk mitigation and adaptable resolutions for their clienteles.
This model frequently sidesteps upfront costs, relying on contracts spanning one to multiple years, facilitating seamless adaptation to evolving needs and automation trends. Given the non-ownership of equipment, the onus of maintenance and uptime rests on the manufacturer.
Pay-per-pick resonates with RaaS but takes a distinct route. In this pricing model, users are billed according to the volume of items handled by a robot. This proves especially advantageous in scenarios like warehouse automation, where charges are intricately linked to a robot’s efficiency in processing items.
This model offers flexibility, ensuring effortless scalability. Similar to RaaS, upkeep and guaranteed uptime fall to the manufacturer.
While the adoption of automation is surely a game-changer, warehouses and DCs should do their due diligence before making decisions. As our CEO often says, “you make business decisions based on data, shouldn’t you do the same with your warehouse?” No truer words can be spoken.
The good news is you have all the data you need to make informed decisions on how to best maximize space, increase productivity, improve safety, and reduce order errors. It’s just a matter of knowing how to extrapolate and analyze the data.
LD Systems is a world-class Systems Integrator, having orchestrated over 500 automation projects. Our track record underscores our knack for leveraging technology across industries to surmount productivity hurdles.
Rob Railis at LD Systems
If you’re in need of warehouse optimization or thinking about fulfillment automation, we encourage you to reach out via firstname.lastname@example.org or visit our contact page at https://www.ldslc.com/contact/.