Due to the pandemic, the shift from physical shops towards online spending has accelerated by an average of five years. In 2020, 87% of UK households made purchases online and recent statistics show that 70% now prefer it. E-commerce is booming, and it is a trend that is here to stay, with online retail spending in the UK expected to reach £75 billion by 2024.
So, what does this transition towards digital spending mean logistically for businesses? The race is now on for retailers and third-party logistics (3PL) providers to secure more warehouse space and capture a share in this growing market. As is stands, warehouse space has already increase by 73% since COVID-19 restrictions began in March 2019. In addition to this, Brexit also played a role in companies bringing their supply chains closer to home. It’s predicted that, by 2024, the impact of growing e-commerce sales in the UK could require an additional 92 million sq ft of warehouse space.
Businesses need also address speed and accuracy, with the average consumer expecting rapid deliveries of products that are both made to order and easily returned. Therefore, the pressure is on for businesses to operate as efficiently and effectively as possible to service a growing marketplace with increasingly high expectations – and all with fewer errors and at a lower cost to serve. This is where technology is set to play a major supporting role, bringing fundamental changes to the ways in which warehouses operate.
The Internet of things (IoT)
The IoT broadly refers to the connection of devices and sharing data via the internet. In the world of warehousing, this has become an increasingly important driver in boosting automation. Thanks to the IoT, modern warehouses can be more connected, coordinated, and seamless in their operations, helping them manage escalating demand and run more efficiently.
IoT sensors give an object digital intelligence. This enables devices to communicate with other online systems in real-time and share vital data with warehouse workers. Businesses can use the IoT to connect their equipment, robots, drones, and pallets, while monitoring their inventory and even supervising employees remotely. The IoT is particularly useful for a real-time view of inventory and capacity. Businesses can spot gaps when they appear and make best use of available space. Meanwhile, customers can receive full transparency on package tracking.
Warehouse Management Systems (WMS)
A fully optimised WMS can enhance a business’s productivity, boost efficiency, and lower costs by digitising its processes. It also helps avoid common mistakes like slow shipments, poor inventory management, or incorrect product details – all of which can be costly and lead to unhappy customers.
This software assists with an extensive range of key day-to-day operations. These activities might include inventory management, stock replenishment, order picking, labour management, and shipping. Ultimately, it gives an insightful and holistic overview of operations. As a result, informed decisions can be made. For example, an accurate, real-time view of inventory means companies can effectively gauge stock needs and avoid back orders. A WMS can even be used to boost productivity amongst workers, matching them to specific jobs at the right time, and guiding them around the warehouse in the most efficient manner.
Automation
Automation has become a key part of boosting warehouse operations. This can enhance efficiency, speed, accuracy, and safety. Over the coming years, all warehouse operation is expected to have some level of automation. In fact, automation is already a significant market, representing over $10 billion in annual global spending.
There are lots of exciting emerging technologies on the horizon, and it appears that the more established, proven technologies will have the biggest initial uptake. Recent industry research reveals that 65% of warehousing operations are expected to invest in conveyors and sortation systems over the next 3 years. 56% will adopt shuttle systems, which allow warehouses to increase throughput and storage density. Even well-established technology – such as stacker cranes and traditional automated guided vehicles (AGVs) – are expected to see relatively high levels of automation adoption.
A way to help transport bulk goods quickly and safely, forklift trucks (FLTs) are a popular form of automation in warehouses. Modern FLTs are fast to fuel, as they run on liquid gas rather than batteries. Therefore, warehouses with their own centralised supply tank can benefit from automatic top-up technology. This means they always have the power they need, increasing productivity and reducing downtime.
Robots
As we look to the future, robots are expected to take centre stage. In warehouses, robots can help operations become more efficient and productive whilst reducing errors and improving safety. It’s estimated that there’ll be around 50,000 robotic warehouses by 2025 with over four million robot installations. Robots are already used for a whole host of warehouse functions, from picking and packing, to sorting, batching, transporting, inspection, and security. Many large corporations are investing in these emerging technologies. As of 2021, Amazon has around 350,000 mobile drive units.
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