Logistics Technology
Warehouse Management

Why Warehouse Automation Is the Coolest Part of Logistics Automation

Published by in Logistics Technology

If you’re going to drop a huge chunk of cash on improving your company, there are much worse investments than in automating your logistics operations. In my mind, the coolest part of logistics automation is what’s happening with warehouse systems.


Warehouse automation uses many of your company’s existing systems and assets to bring even greater flexibility, efficiency, and scale to your operation. It’s like gutting your ’96 Toyota Camry and dropping a jet engine under the hood – well, except that it won’t kill you and it’s totally legal. Maybe that’s a poor analogy.

In this article, I’ll talk about the basics of automation, what sorts of changes you can implement – depending on budget – and where you can go for more information on warehouse automation.

The basics of automation

Automation in any setting is all about finding repetitive tasks that consume large amounts of time or that commonly lead to errors. Once you find those points in your process, you can start to think about automating them.

Manual data entry in accounting is a pretty classic example. It both requires a ton of repetition and it’s prone to be riddled with mistakes. To combat this, we’ve created systems that automatically pull in data from our banks, apps that convert pictures of receipts into accounting entries, and payment systems that automagically import their data into your accounting system.

Warehouses also have these repetitive pain points. You walk to a bin, pick a thing out of a bin, and put that thing in a new location over and over. You enter shipments into tracking systems over and over. You sort, categorize, and store items over and over.

Each of these repetitive tasks is an opportunity for automation.

Picking automation

Picking automation is pretty close to magic. Solutions like Perfect Pick from OPEX basically turn warehouse picking into a one-person operation. Using custom, modular shelving – shelving is a bit of a misnomer, this stuff is crazy – you can store goods in massive towers.

To get the goods you need for an order, you load up the order at a picking station, attached to the shelving. Then, a robot flies up and down the towers, pulling out the goods you need to fill the order, sliding out tracks and boxes and bringing them to the picking station.

One person can stand there and take items from the robot, placing them in a box as they go. The system even tells you which box to put them in.

These systems are the opposite of cheap, in absolute terms. Setting one up is likely to set your business back $1 million, at least. According to industry consulting firm Bastion Solutions, you’ll take between two and four years to recoup your investment.

Barcode and scanner automation

Barcoding is one of the oldest – and cheapest – tricks in the book. Using barcodes cuts down on manual entry and error as you track and ship inventory. In its most basic form, barcoding is simply a handheld scanner reading a classic barcode.

In its more advanced form, barcoding can use powerful scanners, able to read barcodes from fifty feet away. That allows you to track and manage inventory on higher shelves and with less walking across the warehouse floor, which cuts down on time spent climbing ladders and in other dangerous situations.

The price range on a full barcode and scanner solution is going to scale very closely with your operation’s size. If you’ve got a small space and limited inventory – supporting a plumbing and HVAC operation, for instance – you won’t be out a bundle, but you’ll save a bundle of time.

Automated vehicles

Beyond automating, storing, and retrieving your stock, you can also – or alternately – automate moving stock in a traditional warehouse. While most businesses rely on forklifts and pallet jacks, there are alternatives in automated guided vehicles (AGVs). These aren’t self-driving cars, they’re self-guided forklifts and pallet carts.

These machines follow digital paths through a warehouse, locating and picking up pallets or boxes. By removing the human component, you increase efficiency and decrease risk. Like computer-controlled players in Mario Kart.

The beauty of AGVs is that they a) can work in your existing warehouse and b) can be purchased as needed. You won’t be the hook for a whole new layout and system right out of the gates.

AGVs can be leased or purchased, with monthly the rental cost for a single unit coming in around $5,500, according to NDC Automation. Expect to pay less per vehicle as you increase the number you lease.

What to do next

If you’re considering moving to some sort of automation, consider all the options available. With any amount of automation, the goal is to increase the safety and profitability of your business. To figure out what you’ll achieve, you need to build a business case. Most major automation suppliers will be happy to help you out, but be wary of over-optimism.

I would also suggest doing a number of site visits to other warehouses or operations that have the sort of tools in place that you’re considering. See how they work on an everyday basis and get a real idea of what sorts of challenges implementation may pose.

If you’re looking for an ERP or inventory management system to go along with your new hardware, check out Capterra’s ERP and inventory management software directories. We’ve got lots to choose from.

Looking for Warehouse Management software? Check out Capterra's list of the best Warehouse Management software solutions.

About the Author

Andrew Marder

Andrew Marder

Andrew Marder is a former Capterra analyst.


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