The warehousing and logistics industry is undergoing a significant shift. Ecommerce growth means warehouses face incredible pressure to innovate or get left behind. Consumer expectations around fast, convenient, and free delivery have never been higher. Vacancy rates may be seeing a slight uptick to 3.5% but are still well below the 10-year average of 5.0%. Responding to these challenges, warehouses are adopting technology and automation, and inventions once considered futuristic are now instrumental.
While the pandemic created extraordinary supply chain challenges that forced businesses to innovate quickly, technology shaped the warehousing landscape well before COVID-19. Everyone from logistics upstarts to ecommerce giants are looking for agile and responsive solutions.
Warehouses deploying the latest technology trends are finding many benefits—improved accuracy, efficiency, and scalability from integrating formerly disparate systems. Smart warehouses lean into automation to optimize nearly all processes and boost employee capabilities and productivity. Armed with an unprecedented amount of operational data, from inventory tracking and transportation management, these warehouses can make strategic decisions to achieve operational resilience that meets (or exceeds) evolving customer expectations.
Innovative technology alone isn’t enough to reach the goalpost, however. New solutions and systems can cause strain among workers unfamiliar with the technology and introduce complications in integrating new technologies. And that’s if warehouses can keep tech-savvy employees during the ongoing labor shortage.
To create and sustain success in this environment, warehouses are automating and optimizing operations through digital and physical innovative technologies.
What is Warehouse Automation?
Investing in smart warehousing technology is critical for logistics companies looking for cost efficiencies to scale successfully. Automating manual processes drives operational efficiency, empowering warehouses to address potential issues proactively surfaced through real-time data insights. In warehousing, there are two types of automation: digital and physical.
- Digital automation uses a combination of electronics and software to reduce and alleviate manual processes to let employees better focus on customers and vendors. Popular warehouse management systems (WMS) are one example of digital automation software as they can replace manual inventory tracking while providing order status and supply chain location information.
- Physical automation reduces the physical labor of employees. One example is Automated Guided Vehicles (AGVs), which transfer products or materials within a warehouse, reducing the number of work-related injuries and eliminating many manual, rote functions. This is especially important as warehouses are estimated to be understaffed by 10-25%, with material handlers and forklift operators in the shortest supply.
Automating alleviates cost pressures on warehouses and reduces errors that impact profitability. A mistake in inventory tracking can cascade into a series of mishaps, potentially jeopardizing customer or client relationships. Modern warehouse management technologies ensure precise tracking, maintaining brand trust, and delivering cost reductions and improved service, allowing businesses to expand services and capture a more significant market share. Analytics dashboards today also extend into the workplace, spotlighting employee efficiencies.
Emerging Technology Trends
Digital automation is driving the adoption of several trends and technologies in modern warehouses. Fulfillment processes are getting a boost from barcode scanning, giving a clear view of inventory data. Beyond the traditional barcode, RFID tags and QR codes hold a wealth of data, streamlining inventory processing and facilitating better data-driven decisions. The Internet of Things (IoT) is becoming deeply ingrained in warehousing, predicting even more integration in the coming years, with projections to grow to a $94B market over the next five years.
Connected logistics technologies break down data silos, offering insight into operations and aiding in real-time decision-making. With on average 2.7 systems integrated with a company’s WMS, these tools revolutionize how goods are located and prepared for shipment, from automated picking to voice-automated selection. Advanced analytics and real-time data visibility tools are transforming warehousing. Businesses no longer rely on paper-heavy processes but are leaning on software solutions to keep errors at bay and improve inventory management. While AI and Machine Learning are in their early stages for warehousing, they promise a deeper understanding of data, predictive insights, and more streamlined supply chain management.
The Robotic Revolution
Physical automation is the area ushering in the kind of robotic-led future that science fiction has imagined for decades. In warehousing, the buzz about robotic automation isn’t just hype, especially as it’s become increasingly affordable with new pricing models like robotics as a service. AGVs and Autonomous Mobile Robots (AMRs) can efficiently move goods within a warehouse using sophisticated sensors and AI for path planning and obstacle avoidance. Collaborative Robots (Co-bots) use is also on the rise. Instead of replacing workers, co-bots collaborate with them. They’re beneficial for repetitive tasks like material handling and pick-and-place, though their utility will likely expand with new use cases.
Warehousing is no longer just about storing goods – it’s about harnessing technology to do so efficiently, accurately, and at scale. As ecommerce continues to grow and as technology continues to evolve, the warehouses that adapt–and automate—will be the ones that thrive.