Assessing your current warehouse operations is the first step toward effective automation; by understanding demand, capacity, and growth goals, businesses can identify where automation solutions, like those offered by Tension Packaging & Automation, can alleviate bottlenecks, reduce overtime costs, and position fulfillment processes for scalable growth.
For all the buzz around automation in fulfillment and distribution operations, the casual observer who hasn’t automated their warehouse yet could be forgiven for thinking they’re the last ones to take the plunge. In reality, as recently as 2021 more than 80 percent of warehouses had no automation whatsoever. In some cases, that may be because those businesses took a close look at what they required to meet demand and concluded that they didn’t need automation. But it’s far more likely that they are part of the much larger group that isn’t sure what automation can achieve for them and, more importantly, isn’t sure how to get started implementing a warehouse management solution that would be right for them.
Growth is often the catalyst that pushes a business to move from curiosity regarding automation to an urgent need to do something to alleviate bottlenecks in their fulfillment processes. However, the wrong solution could potentially cost your business money without producing any significant benefit in accurate throughput. In this series, we’ll go through the steps to getting started on your automation journey to help ensure that your chosen solution meets your needs today and into the future. It begins with understanding what’s happening in your business now.
Taking a General Overview
Before you even begin looking at possible equipment and software, the first question is: How is your operation running today? Do you have enough people to keep things moving? Are you getting your orders out on time consistently? And if the answer to that last question is yes, are you using overtime to do so?
If you’re finding your existing workforce can’t keep up with demand on a regular basis, that’s an obvious problem that flags the need to consider automation. However, if you’re relying on overtime regularly to keep up, or surges in order volume routinely overwhelm your company’s ability to maintain timely shipments, these are also signs that your capacity is stretched to a point that limits your potential for growth. Leaning too hard on overtime also erodes your bottom line and runs the risk of burning out your workforce. In these cases, by expanding your capacity, automation helps to keep overtime expenses down and to reduce turnover.
Drilling Down on Specifics
Automation is a general term for different types of equipment, plus warehouse management software, that increase the volume of packages a fulfillment operation can process while optimizing accuracy. What configuration of packaging equipment, conveyor systems, and sortation systems will produce the greatest benefit for a company, however, depends on the specifics of how much and what they are shipping.
Volume is the first consideration. How many orders do you have going out per day? In our experience, around 500 to 1,000 orders a day is a point at which a warehouse should really be looking at options for integrating automation—but that’s a minimum, not a maximum. For a SLAM (Scan-Label-Apply-Manifest) system, it depends on the operation, but 500 orders per day is a general minimum where it starts to make sense.
Beyond that, it also matters what you are shipping and how. Are your products going out in boxes? Bags? What is the average mix per day? For example, if you’re shipping 500 packages per day, is it 200 boxes and 300 bags? This will help determine what type of conveyor and sortation systems would be best, as well as what type of automated packaging equipment might benefit your operation.
How Fast Do You Want to Grow?
The final factor you should be considering at this stage are the growth goals you have for your business in the near future. What are your growth plans in the next two to five years? What percentage of growth are you anticipating or aiming for per year? Twenty percent? Thirty percent?
You don’t have to invest in equipment that can instantly handle the volume your loftiest goals would demand, but you need to be sure your initial configuration is set up to give your operation room for immediate growth targets. You also want to be sure that your system can be readily adapted and augmented to keep pace with increased shipping volume and changing needs. The right solutions will make it easier to expand with a minimum of growing pains.
Your Automation Partner
If it’s time (or past time) for your warehouse to take a serious look at automation, Tension Packaging & Automation is your ideal partner. Our experience in taking eCommerce and pharmacy operations from little to no automation to customized systems that optimize productivity allows us to guide those just starting their automation journey. We’ll assess your needs, make recommendations that support your business goals, integrate your chosen solutions into your existing processes, and provide the training and support essential to ensure you get the most out of your automation investment.
Ready to get started? Contact Tension Packaging & Automation today to discuss your distribution needs.