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New construction or retrofit an existing warehouse?

Distribution e-commerce grocery retail micro-fulfillment retrofit

The rise of e-commerce, changing consumer preferences and growing customer demands have drastically changed order fulfillment requirements. Companies must now offer greater product variation and provide fast, accurate fulfillment in order to stay competitive. Many warehouses find themselves operating at full capacity to meet these demands, while dealing with inefficient processes, outdated equipment and a lack of available space for accessible storage.

Often, businesses reach a point where their existing facility can no longer support their current volume, let alone accommodate future growth. Many consider moving operations to a new warehouse with a larger footprint. But a drastic location move poses its own series of hurdles. For example, construction of a new facility can be a costly and time-consuming undertaking that many companies lack the budget to complete.

Retrofitting manual facilities for greater efficiency

Instead, companies can adapt their current facilities to meet the changing marketplace through automated technology. By retrofitting an existing facility with robotic material handling hardware and software, warehouses can optimize material flow, improve efficiency and better utilize the space they have available without having to uproot their business. Whether picking small, direct-to-consumer orders or large quantities for retailers, warehouses can get more shipments out the door faster and with 100-percent accuracy.

Further, retrofitting with automation can solve staffing challenges. Across all industries, warehouses are experiencing a talent shortage, particularly in highly concentrated, industrial areas where competition is high. This lack of available labor is one of the most common reasons why many businesses look to relocating. Rather than moving operations to a region with a larger labor pool, companies can implement automated solutions to overcome insufficient staffing, cut costs and run efficiently 24/7. Notably, automated systems can be up to six times more efficient than manual operations, and free up existing human workers to focus on more sophisticated – and fulfilling – tasks.

High-density storage and better inventory control

Lack of storage space is another major issue that leaves companies feeling strained in existing facilities. Since many older warehouses were built with smaller footprints and lower ceiling heights than those designed today, it can be difficult to accommodate the necessary racks and shelving needed for manual storage. If the available square footage is poorly utilized, warehouses inevitably struggle to house the growing number of SKUs and increased inventory volume during peak seasons.

An automated storage and retrieval system (AS/RS) creates high-density storage areas and optimizes space utilization. In fact, the right AS/RS can operate efficiently even in low buildings while using up to 50 percent less space than traditional storage methods. For example, warehouses can utilize a floor-based storage system in which goods are stacked on the warehouse floor and retrieved from overhead.

Warehouses can also save space by using a Warehouse Control System (WCS) to optimize inventory volume. With an effective WCS handling inventory management and replenishment, facilities can maintain the right SKU levels for rapid order fulfillment without needing to carry overstock.

While much of the focus is on fast-moving items when considering automation, these solutions can also be used to optimize the handling of slow-moving products. By automating steps of the picking process for slow movers, facilities can shorten the driving distances required to pick from pallets. This improves the overall speed and efficiency of remaining manual picking operations. Further, companies can free up more space from slow movers to house new SKUs, translating to more customer sales.

Modular, scalable solutions for faster ROI

From initial planning and design through construction, a new warehouse build requires high capital investments and may take years to complete. And when the time comes to move to the new facility, productivity declines as operations are disrupted.

A turnkey, modular robotic system is easy to install in an existing warehouse without impeding operations. While automation can be used to run entire operations, modular systems can be installed through a phased implementation. Operating as “islands” of automation within a manual facility, these systems can then be scaled as volume increases and business grows. By gradually expanding automation over time, warehouses can keep costs down for a faster return on investment.    

If your business is feeling the strain of an outdated warehouse, an experienced solutions provider can evaluate the challenges caused by your existing space and determine if a retrofit is the best solution. Using the right automation technology, your warehouse can optimize efficiency, increase throughput and keep up with the changing business pace.

Author Kai Tuomisaari

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