The market for storage and retrieval systems is coming of age, bringing new levels of efficiency. Johanna Parsons examines the way in which e-commerce is driving the market.
E-commerce has changed retail forever, but it has also transformed the market for automation systems. Handling technology itself has reached new heights of efficiency, and the way businesses use the storage and retrieval systems at the heart of their warehouses now reflects a new level of maturity.
83 per cent of e-retailers now think automation will drive future online retail growth, and 49 per cent will have reduced manual processes even before the next peak period, according to a recent survey by Sapio Research for Conveyor Networks.
It’s widely accepted that e-commerce is the biggest influence on today’s logistics operations, so it’s worth considering what Sapio’s survey reveals about the way the wind is blowing. 45 per cent of e-retailers reported lack of staff as being a key problem, and 42 per cent said order errors were a big issue. So, as surely as pack follows pick, automation is on the agenda.
The business case for automated systems is often inarguable, “They really do deliver,” says Neil Adcock, of Bis Henderson Consulting.
“Some of the technology that we’ve seen recently and that we’re advising on at the moment, the speeds and the efficiency that can be sustained are absolutely superb.”
And as reflected by the Sapio statistics, hiring extra people is a problematic and pricey alternative. Adcock sees the costs and complications of labour as being one of the key drivers in take-up of automation.
“It’s a whole range of factors. The technology is improving, the pick speeds are getting better but equally labour is getting more expensive and less reliable. You’ve got the national living wage, the apprenticeship levy, all of those things bear a cost so suddenly those trade-offs make the payback look more interesting. Particularly availability at peak is a real challenge in this industry and its becoming more and more and more difficult,” he says.
Logisticians are, of course, thinking wisely about the systems they take on. While the argument for automation is compelling, more automation is not always the answer, and while robots may be de rigueur, they are not necessarily taking over.
Ian Fisher, chief information officer for DHL Supply Chain UK & Ireland, says: “With recent technological advances enabling robots to be aware of their environment – meaning they can now work safely alongside humans – we are moving closer to a logistics environment where automation plays a leading role in storage and retrieval. However, far from replacing people, we are looking into how robots can support our employees and where it makes sense for humans and machines to work together.”
Adcock explains that robots are no panacea: “A lot of customers with their products will require the manual dexterity that only a human can give… In an omni-channel warehouse that might have a range of fashion and household in it, that’s actually a much more difficult thing for robotics to do. It goes back to why you have ASRS and picking stations – because they are still phenomenal at doing that kind of activity on a really broad range of products.”
Storage and retrieval is now a focal point for investments, with staffing one of the biggest of several factors putting pressure on this side of the warehouse. “Storage and retrieval systems are now firmly under the spotlight – and being brought increasingly into sharp focus – as the threat of a Brexit-induced labour shortage looms large over British industry…. Crossing the shadow line into automation has never before been so appealing as it is now,” says Mike Alibone of SSI Schaefer.
Part of that growing appeal is that as the technology matures, cutting edge systems are becoming more affordable. Adcock says that it’s not just the big retailers with mega-bucks budgets that are able to take on high end systems. “When you’re looking at some of the robotics coming in now they are getting more cost effective, more flexible, easier to implement than perhaps they were a few years ago,” he says.
Mike Holton of TGW says that the demands of e-commerce are forcing more operators to turn to automation: “Product ranges, sales channels, distribution strategies, labour requirements and energy costs can all shift significantly in a relatively short period and affect the warehouse operation. Advances in automation and robotics, combined with a reduction in unit or operational cost have made the technologies a more viable consideration across a range of sectors.”
Edward Hutchison, managing director of BITO Storage Systems agrees that there is better economic justification now for more types of business, citing “higher volumes, a growing demand for faster order fulfilment and greater value on the one hand, with rising staff costs on the other.”
“Automation’s modularity, sophisticated control systems, and performance developments can create a more practical and flexible solution for a greater variety of applications – from fulfilling omni-channel retail to supplying line-side manufacturing,” says Hutchison.
Numerous factors influence fulfilment speeds besides shuttles and robotics and as highlighted by the Sapio survey, an important one is error. To that end logistics operators are taking on board the impact of a good IT system within the warehouse and Jungheinrich’s Richmond says that there is an increasing engagement with software and warehouse management systems to oversee flows and minimise mistakes.
He says another key is to have the right kit for the job and suggests letting the product dictate the handling systems deployed.
“For some of our customers, manual solutions are still best suited for their requirements, for example where the items are bulky or not readily suited to an automated solution. For others, we’re providing semi-automated solutions, bringing product to pick faces, and then engaging in a high degree of efficiency bringing those products to a formal pick area,” says Richmond.
Adcock says understanding the product portfolio is vital for future-proofing the operation. “Understanding current and future growth is also particularly important.”
“And that’s true not only in terms of throughput and stockholding, but also thinking outside the box of what else is it that I’m going to sell in the future? Am I going to sell a lot more SKUs for example, and how are they going to be handled? Am I going to sell different types of products and can they be handled?” says Adcock.
For the time being there is an encouraging level of investment in storage and retrieval systems, with some reporting an “urgent” demand for ASRS to service e-commerce fulfilment. But the requirement is by no means limited to e-commerce driven single item picking.
“While in some ways e-commerce is driving uptake of systems that can optimise lots of individual item picks, there’s still a significant demand for third party logistics companies and manufacturers to store goods in bulk quantities at the point of distribution or manufacture,” says Steve Richmond, director of logistics systems, Jungheinrich UK.
“We’re seeing an increased demand for semi and fully automated systems that support both small parts picking and storage, but also bulk storage, as organisations across the board look for new ways to drive further costs out of the business, improve efficiency and increase productivity,” says Richmond.
TGW’s Holton mirrors Richmond’s reports of demand for software and says that there is a distinct appetite for design updates and system support to match the growing complexity of clients’ supply chains.
“Establishing an accurate total cost of ownership is key to a purchasing decision but, once the installation and commissioning is complete, the focus should be on reducing that figure through a programme of continuous improvement and service enhancement. We are now at a stage where our Life Time Services portfolio is being adopted where we have only a limited or even zero presence in the customer’s existing supply chain,” says Holton.
It seems the way kit is being used is often as important as the actual equipment itself, with new ways of thinking about storage yielding new methods of working. For example, SSI Schaefer’s Alibone says that ASRS are now being used to organise and speed access to goods after the pick process, storing and sometimes collating orders as they are readied for the pack and delivery stages.
“Shuttle systems come into their own, with the ability to use them within an automated storage system in the shape of a shipping buffer,” he says. “This can then be used to consolidate picked orders and release them in sequence, according to the challenges and demands generated by short throughput times, short delivery windows, major delivery peaks and – in the case of e-grocery – a consistent cool chain right up to the customer’s doorstep,” says Alibone.
Holton says it is the demands of “just-in-time” fulfilment that are sparking inspiration for reinvention. “Across the piece automation that can store and retrieve quickly, such as shuttle technology is growing in popularity, together with desire to always bring the goods to the person using a range of ‘Goods to Person’ technologies. Automated guided vehicles (AGVs) are a prime example of this, a technology that has in truth been around a long time is now seeing a marked renaissance.”
Alibone concurs. “In a storage and retrieval context, AGVs are robots in their simplest form, which are now able to pick, locate and transport… In comparison to fixed handling devices within a racking complex, they are able to replace forklift trucks, trolley-pushing humans and conveyors, thereby adding an unprecedented degree of flexibility.
“They can also be adapted to carry and transport hanging garments, as SSI Schaefer have done with their Weasel AGV for NextLevel Logistics. In this instance the Weasel fleet bodies have been fitted with special fixtures for their transport. A fully automatic goods-in reading process is achieved by using RFID read tunnels for the automatic RFID bulk stock recording of the transported goods. With optical track guidance, the AGVs do not require any fixed system components,” says Alibone.
Hyster is another proponent of AGVs, using modified forklift trucks as a scalable version of automation. “We found that the costly automation solutions usually seen in the logistics sector are implemented on a large-scale but fail to meet the needs for recurring, but intermittent, automated tasks,” says Paul Smith, manager, integrated solutions, Hyster Europe.
“The flexible Hyster solution allows the truck to be used as a fully automated unit for repetitive tasks, or as a supportive, partly-automated machine, for activities such as order picking,” he says.
And AGVs are not the only alternative to high end automation. The classic concepts of conveyors and live storage offer a lower cost alternative that is especially suited to dense storage of pallets or cartons. They can also be incorporated into future automated systems. Bito’s Hutchison points out that live storage works particularly well as a part of a wider automated system.
“The two systems can also complement one another – with automated stacker cranes replenishing the live storage by feeding products into the flow lanes where they travel on rollers to the pick face at the front, allowing orders to be picked directly into their related bins.”
AGVs and live storage are also a good example of modularity. They can be scaled up relatively cheaply, which is a big advantage as retail peaks become more influential.
“For most integrated automated storage and retrieval systems, Return On Investment (ROI) remains a matter of years rather than months. For those more trepidatious about the ROIs of automation, there it is always possible to take a stepped approach, adding integrated conveyors and technology such as pick to light to carton and pallet live storage,” says Hutchison.
Multi-patent miniload from Jungheinrich
Jungheinrich unveiled its first high-performance miniload, the STC 2B1A, at Logimat in the spring.
The STC 2B1A has a travel speed of more than 6 metres per second. It has energy buffers that recoup energy released during braking and feed it back into the drive system during acceleration, reducing energy consumption by up to 25 per cent.
The miniload has three new patents: a lightweight 25m mast; a travel rail concept; and an integrated Omega drive system for more space-saving storage.
Jungheinrich says these features give higher storage capacity and higher throughput for a warehouse of comparable size.
“We have created an unparalleled intelligent and economical logistics solution for our customers that contributes significantly to lowering operating costs,” said Dr Klaus-Dieter Rosenbach, board member for logistics systems at Jungheinrich.
HELLA goes automated at Shanghai warehouse
International automotive parts supplier HELLA has ordered an automatic mini-load warehouse from TGW Logistics for a new intralogistics centre in Shanghai.
TGW will supply a six-aisle mini-load warehouse with around 120,000 storage locations, operated by six of its Mustang storage and retrieval machines.
TGW’s scalable KingDrive technology will provide the conveying system for the new installation and will connect an existing building and the new facility. The small-parts warehouse will be equipped with seven workstations and will also store raw materials for the production lines as well as finished goods for delivery.
TGW will provide the IT and control systems for the centre, as well as the warehouse control system. HELLA has also taken on a Lifetime Services contract.
“This order is a milestone for TGW China and we are excited to embark on this project with such a prestigious and well-known customer,” says Frank Imkamp, chief executive officer of TGW China. “Our one-stop solution is a milestone in automated intralogistics systems and this project will also serve as a benchmark to other prospective customers in China.”
This article first appeared in Logistics Manager, May 2018