Viewpoint: How warehouse/ DC automation is changing logistics

In every issue of Logistics Management (LM) we devote an article to the growing importance that warehouse and distribution center (DC) operations are playing in transportation and overall logistics management. In fact, more and more of our case studies highlight the benefits of a truly integrated logistics operation, where transportation staff is working in unison with an automated warehouse and DC operation to ensure an uninterrupted flow of goods.

The driving force behind much of this improved collaboration and the growing interest in materials handling automation across the board is the concept of multi-channel retailing.

In this emerging, multi-channel environment, flexible retail warehouse and DC operations are now handling a variety of functions out of one facility—direct-to-consumer order fulfillment, store replenishment, wholesale distribution, and global distribution. And, of course, any retailer worth its salt today has to fill orders in all of these channels, even though each has distinct order profiles, order quantities, and inventory requirements.

This move toward multi-channel order fulfillment and the related importance of piece picking is having a game-changing effect on how quickly retailers are turning to automation to do more with less in smaller facilities. But not only is this automation helping to fill the variety of complicated orders more accurately, it’s also collaborating with transportation management systems to solve the new freight challenge that comes with filling multi-channel orders.

In many cases, smaller more frequent deliveries are now going to store fronts, smaller regional DCs, or customer homes. In turn, retailers are moving to smaller trucks and vans due to the nature of these shipments and congestion in more urban areas, putting greater emphasis on proper trailer loading and speed to market.

To put context around the exciting materials handling automation developments for LM readers, we’ve turned to Bob Trebilcock, executive editor of LM’s sister publication Modern Materials Handling. According to Trebilcock, both the conveyor and automatic guided vehicle (AGV) sectors posted impressive year-over-year growth numbers despite the fact that much of the materials handling industry has yet to get back to pre-recession peaks. However, the growth of these sectors should come as little surprise.

“The multi-channel mandate has forced the hand of any reluctant retailers,” Treblicock told me as he wrapped up his article “The State of Automation.” “Today, the best retailers are implementing goods-to-person order fulfillment solutions that are flexible enough to pick ‘eaches’ and cases in one facility. Now, with retailers pushing the envelope even as far as fully-automated, ‘lights-out’ facilities, the manufacturing sector will soon benefit from these developments.”

Starting on page 22, Trebilcock offers a comprehensive look at the state of materials handling automation and the impact these developments are sure to have on the future of transportation and logistics management.