ROI Factors for automation
- Floor space utilization: This is a key, but underestimated ROI factor for many operations. Because space is expensive, companies can reap significant benefits quickly once a system is installed that allows them to stay at their current location or delay new facilities. For landlocked operations in tight real estate markets, this can be a decisive factor.
- Labor efficiency: Labor is in increasingly short supply and it won't get better. AS/RS excels at reducing the number of people needed to operate a picking or assembly or manufacturing operation. People used to consider automation because it reduced costs. Now, it's seen as a way to operate in an environment where labor may simply be unattainable. This is frequently the driving force for automated systems ROI calculation.
- Picking accuracy ROI: Modern consumers have been conditioned to return products free and easily. AS/RS helps you reduce the errors that drive those return rates, which reduces costs throughout your system.
- Safer working environments: This works in two ways. First, because AS/RS tends to consolidate storage into tighter footprints, it reduces the interactions between people and forklifts -- one of the most constant industrial safety issues. Also, AS/RS improves ergonomics, by reducing the bending, stretching, reaching and twisting that result in musculoskeletal problems and injuries. Finally, it eliminates much of the unproductive walking and transit time spent by warehouse workers.
- Other factors: Remember to consider inventory control improvements, security, land and facility cost reductions, energy efficiency (when compared to manual or less automated solutions), productivity gains and worker satisfaction.
In-depth: automation ROI
How long does it take to achieve return-on-investment?
While it's difficult to calculate return-on-investment without specific metrics and for specific situations, ROI for automation has become more about operational capacity and less about cost savings in recent years due to supply chain problems, labor availability and increased demand for faster, more reliable distribution and warehousing. We can help customers in the Carolinas evaluate their automation alternatives. Call today for fast assistance.