Recently there has been plenty of chatter about automation and robotics. And the message to businesses operating across a broad spectrum of industries is clear – the age of automation and the industrial robot is here and you ignore the technology at your peril.
But for third party logistics (3PL) services companies investment in automation has traditionally been hard to justify: the technology required a relatively high level of financial commitment over an extended period of time before evidence of payback began to appear on a 3PL’s bottom line. This meant that unless a 3PL’s client was prepared to commit to a contract of at least five years, automating any aspect of the goods-in, storage, order picking or goods-out process within the warehouse rarely made financial sense.
However, recent developments have made automation more scalable and flexible and as more alternatives to, for example, stacker cranes – and the other kind of fixed assets that were always central to any fully automated warehouse project – enter the market, payback times are being cut significantly.
Promoters of warehouse automation also point to the rising cost of human labour and the predicted reduction in the number of people available to work in distribution and fulfillment centres following Britain’s withdrawal from the EU as factors pushing automation closer towards the economic justification zone for logistics operators.
So, as many 3PLs find themselves juggling higher volumes with growing demands for faster order fulfillment, at the same time as staff costs are creeping up and good quality, reliable workers are reportedly becoming harder to find in many parts of the country, it would appear to be getting easier to make a case for greater automation and/or the introduction of robotics.
Within the single client ‘mega sheds’ operated by the biggest logistics multi-nationals that certainly seems to be true, but is automated technology really a viable option for small and medium size 3PL companies who may serve multiple clients – all with unique product ranges – from a single storage facility?
At Walker Logistics, for example, we operate over 250,000 sq ft of ambient storage space within which we store, pick, pack and dispatch goods for nearly 50 very different clients.
The products we handle vary from garden furniture to cosmetics and we provide a full range of B-2-C online fulfillment services as well B-2-B stock replenishment. In a typical day we will process tens of thousands of online orders (which can be anything from an ecommerce basket of 2-3 items through to a subscription style order containing hundreds of items). And we fill multiple stand trailers per day for shipment to our clients’ retail customers.”
Of course, we operate sophisticated warehouse management software and our shop floor personnel all use the latest hand held data capture devices, which ensure that our pick-accuracy statistics are, we believe, among the highest in the sector. We operate a modern lift truck fleet as well as a range of other materials handling equipment, including state-of-the-art wave pickers, which we upgrade regularly. And yet, because of the diverse nature of our client base and the wildly varying dimensions and packaging requirements of the products that we process each day, automated technology that is capable of undertaking many of the tasks which are currently carried out by people is hard to identify.
We are fortunate to be based in a part of the country which appears to be blessed with an intelligent and dedicated working age population from which we draw our permanent and temporary staff and do not find it difficult to recruit personnel who are quick to learn and keen to work, so, perhaps we are not experiencing the same labour shortage issues that other 3PL companies of our size appear to be concerned about. As a result, we do not feel under any immediate pressure to adopt automation, but with construction of a new 100,000 sq ft storage facility expected to start soon at our Lambourn Woodlands site, we are keen to explore the benefits that automation or robotics might bring to our business.
We constantly evaluate our processes and look for ways to make efficiencies across all aspects of our operation, which means the case for investment in new forms of equipment is always up for review.
But we are not the sort of company to throw money at technology for technology’s sake, and while developments in automation and robotics are moving forward with tremendous pace, we believe that it is most likely that a balance will have to be struck between automation and manual labour to achieve the most cost-efficient, safe and accurate storage and picking in the future. For the moment though, we are quite content to retain the human touch across our business – and more importantly, our clients are happy for us to do so too.