Can an AS/RS Save your Operation Time and Money?

Several years ago I was offered an opportunity to start working with Automated Storage and Retrieval Systems (AS/RS). I jumped at the opportunity with excitement and willingness to find the perfect customer who needed something like this to meet their needs.  What I didn’t realize, although the technology has great benefits, it requires operational review and analysis in order to apply properly and develop the right cost justification.  I learned that technology is not right for every operation, but for the RightFIT operation, there are great benefits and savings.

Free Guide: Top Order Fulfillment KPI Indicators

How is it defined?

An AS/RS is a type of machine or system of machines that puts away, stores, and retrieves products without direct labor involved in the process. There are different types of ASRS technology that handle pallets, totes/cases, or units, and there are multiple factors that can impact the cost of as/rs.

1. 1. Space Savings – AS/RS technologies are more space efficient than conventional storage and order fulfillment systems, and require a much smaller footprint/square footage resulting in lower construction and operating costs or postponing costly and sometimes difficult building expansions.
      • • Unit load (pallet) AS/RS reach much taller (45-125 ft tall) than manual systems with narrower aisles. They can cut square footage requirements by 30-50% and reduce construction costs by almost as much.
        • Miniload AS/RS can store products much higher (40-60 ft) and more efficiently than conventional storage. It does not require the additional height required at each storage level for a person to see the product and reach in with their hand to remove it.
        • Individual units or hanging garments utilize space over the top of work areas where this space is typically unusable and wasted.

   2. Inventory Control & Labor Management- Inherent to all AS/RS is an inventory control system.  Each AS/RS has to keep track of what products and quantities are stored in each location within the system. This can add a layer of control that is not present in many ERP systems.  Inventory control is also important in dealing with labor management and waste reduction. Each operator interfacing with the AS/RS is identified by the software and their activities are recorded and traceable. This makes AS/RS a good fit for high-value products or any operation that requires increased inventory accuracy or control.

   3. Ergonomics and Training- AS/RS operators by working one stationary location with the work brought to and taken away from their station automatically. These workstations are more ergonomic and productive because the work is always at a comfortable height. The system will create an environment that decreases expensive work-related injuries caused by bending repeatedly.  This will result in lower costs due to injury and employee turnover.  It also has lower training costs and allows new employees to be 100% productive in a much shorter amount of time.

   4. Productivity – AS/RS software determines and uses the optimal sequence and path every time.  It does not talk to other AS/RS about last weekend’s games, go to the bathroom, or take days off. Automated systems of any type are most productive when operated 2-3 shifts per day and are inherently more accurate. Higher Throughput X Fewer Errors = Increased Productivity

   5. Operating Costs- Since there are no people working inside an Automated Storage and Retrieval System there is never a need for lighting.  The only heating and cooling required is for the product.  If your product requires temperatures above or below freezing, an AS/RS has lower energy costs because you will heat or cool a much smaller space.  If your product requires climate control, like a certain humidity range, the AS/RS can be enclosed to maintain almost any climate requirements with lower energy costs.

What does a real life application look like?

Most people have read articles like this, and are left wondering if this type of technology is a RightFIT or if its cost justifiable for their operation?  To help make this decision, ask yourself a series of questions: Am I running out of space? How much are inventory, picking and shipping errors costing me? What are injury claims and lost time costing each year? Could I reduce operating costs if I used less space? After you answer and quantify these questions, you begin to investigate what type of AS/RS is right for your operations, what it may cost and what would be your achievable ROI.  The first step is Analysis your current operation.  Most AS/RS has its best benefit in a certain type of application and/or under certain business or operational circumstances.

So gather some of the following information before you contact a solutions provider to help you with the analysis:

• SKU movement velocity – The number of cases and pallets SKU moves over a 12 month time period
• Labor productivity by task – Lines and units moved per hour
• Annual labor costs by task – Should include all benefits, training, vacation, and other ancillary costs per person
• Existing building costs – Per square foot costs for rent, lighting, heating/cooling, etc
• New building costs – Construction costs per square foot