4flow has published the results of its new study on warehouse automation and volatile demand. In the study “Warehouse automation and volatile demand – a strategic fit?”, 4flow researchers address core questions in warehouse design for today’s supply chain decision-makers: Under what conditions is a warehouse automation design profitable? Can service levels be fulfilled considering possible flexibility constraints of automated warehouse technologies?
Striking a balance between a warehouse’s available capacity and efficiency is a constant challenge in supply chain and logistics. A warehouse that is too large is not cost-competitive – at the same time, opting for a more compact design can lead to significant performance issues, such as stock-outs. “Ultimately, the business case for automation is dependent on good planning and precise predictions about future demand” says Wendelin Gross, Head of 4flow research. “The study draws attention to the key factors that need to be considered and can help businesses to make more informed decisions about warehouse automation.”
By comparing a manual and an automated warehouse solution, the study found that demand volatility, in addition to labor and equipment costs, plays a significant role in determining the ultimate profitability of a warehouse automation design. Standardized planning approaches, such as 3D layout planning and sensitivity analysis regarding cost and performance-relevant factors, enable supply chain decision-makers to make informed decisions in this situation.
For more context, the full study in PDF format is available for download. You can also visit our interactive study to explore selected results and apply them to different scenarios.
Download
Request a copy of the study “Warehouse automation and volatile demand – a strategic fit?” in PDF format