Modernizing a distribution center requires significant investment, so businesses often choose to postpone or avoid expansion of warehouse capabilities and functionality.
What’s surprising, however, is how business leaders can overlook the steps necessary to truly understand the costs of doing nothing.
Businesses routinely choose to not invest in distribution without giving careful consideration to the impact on operational costs and missed business opportunities.
They thoroughly evaluate whether to purchase material handling equipment, warehouse software and distribution buildings.
The same scrutiny should be applied to real and often hidden expenses and the opportunity costs of the option to do nothing.
This approach needs to be included in decisions that lead to a business case for automation or other improvements that expand the warehouse operation.