Have you ever wondered what you need to design the supply chain processes within your (newly build) warehouse and production facilities? How to deal with the higher volumes and the new and complex material flows throughout the site(s)? More importantly, how do you set up these processes most efficiently, but also practical for the floor and its operators? 

Those questions and more always arise especially when a new company site is constructed or when investing in automation. You grab such opportunity with both hands to (re-)evaluate your processes, and preferably design and improve those in such a way to ensure higher material throughput with less hard labor. 

The warehouse automation is based on three main pillars; reducing costs, increasing speed, maximizing space utilization.  

The Costs

As they say, it is all about the money; on average, labor costs constitute 65% of most warehouse facilities’ operating budgets.  Last year in the Netherlands alone, 63 new automated warehouses were build, for which the labor costs decreased by 40% to 75%.  These are impressive figures that directly get your attention. By automating key processes within your company, you can decrease the labor costs for certain processes, and increase efficiency.

The Speed

On top of this, as most have realized by now, due to the recent exponential growth in omni-channel supply chain, more and more warehouses are required to prepare and meet the demand for quick customer deliveries, some even for same-day deliveries.  Automation is therefore key into the warehouse of today and the future. Just to give a small example, Pick-to-Light, Pick-by-Vision, and Pick-by-Voice technologies reduce picking error rates by 67% compared to paper-and-pen methods.


The Space

As is said by the Logistics bureau, “One of the reasons is the need to use the footprint of a warehouse as efficiently as possible by extending warehousing vertically: automated systems can work to heights of as much as 40 meters. The other reason for automation are the difficult working environments, such as cold-stores for fresh products or even frozen products.”  

Where to start?

Many warehouses rely heavily on manual processes and labor to move products through their warehouses. These processes are usually the first indications of where to apply automation. Therefore in essence, you start by identifying the processes that gain the most benefit from automation and apply a solution that fits their need. Below we describe a solution example for the Cost pillar.

McCoy can help you identify which process requires the most labor and find a fitting solution to automate that process. As an example, combining Pick-by-Vision with the EWM Interleaving solution, where you optimize the utilization of your operators by reducing the travel times, and by minimizing the amount of empty travels (without material movements) by the operators. Above that, it has been proven that the introduction of technologies – such as Pick-by-voice or Pick-by-Vision – can improve your pick rate by 25-50%.


Combine into Success

So how automated do you go? Obviously, it depends on how you can fit the technology into your supply chain processes and ensuring you achieve the goals set, whether the Cost, the Speed or the Space. When doing it right, it can result in the best combination of the three, and even deciding to build an entire new warehouse and introducing new solutions to make your company future-proof and ready for the market needs.

McCoy & Partners has a lot of experience in automating processes, and in multiple automated warehouses in different industries. From helping small organizations with their transformation to a high throughput automated Warehouse, to the extensive involvement with major retailers to realize and build big distribution centers. We can help and advice you in every step of the way and can support you in all levels of automation.  How automated do you go? Please share with us your opinion and experience.

Links to refererence materials:

Richards, Gwynne. Warehouse Management: A Complete Guide to Improving Efficiency and minimizing costs in the modern warehouse. London: Kogan Page; 2018. https://books.google.nl/books?id=bDw7DwAAQBAJ&printsec=frontcover&hl=nl#v=onepage&q&f=false