Add Up The Savings In Three Key Areas For Significant Returns On ASRS Investment

by MHI Industry Group, Warehouse Automation

Available warehouse space is at a premium, according to CBRE, with demand outpacing construction by 169 million square feet. And space is pricey too, with rents jumping by 19.2% since 2015. Pair that with the rise of e-commerce (now approaching 12% of all retail sales according to the U.S. Department of Commerce) and an exceptionally tight labor market (with the U.S. Bureau of Labor Statistics reporting that Q3 2019 saw 7 million job openings but only 5.9 million people seeking work), and operations managers are looking for solutions. Specifically, automated solutions — such as automated storage and retrieval systems (ASRS), including vertical lift modules (VLMs), horizontal and vertical carousels, cranes and unit loads, shuttles, and cube-based systems.

While the initial capital investment in these technologies is not insignificant, the tremendous cost savings an ASRS solution can deliver will contribute greatly to the overall return on investment (ROI). Here, a look at the immediate and long-term savings an ASRS will deliver in three key categories:

1. Space Savings. For operations that have maxed out all their available floor and storage rack space to the point that efficiency has become severely compromised, an ASRS provides extremely high storage density as well as inventory management. Further, the installation is configured to match an operation’s space in a minimal footprint by utilizing the vertical, overhead cube within a facility. It also eliminates the need for wasted aisle space required for the navigation of forklifts and other material handling vehicles. This extremely dense storage approach extends the life of a facility without requiring expansion of its current footprint, construction of a new building, or a move to a larger warehouse (while also eliminating the costs associated with those options).

2. Workforce Savings. Labor, both qualified or unqualified, has become extremely difficult to attract and retain. Further, the American workforce is aging and better educated — meaning they’re less likely to be interested in basic warehouse work. ASRS technologies make work easier and more productive requiring fewer associates by automating the picking process and delivering items to an operator at an ergonomic, waist-height position. That further enhances savings facility-wide, speeding up processes from receiving to packing to shipping. By utilizing the goods-to-person principle, an ASRS significantly reduces walking and search time, as well as improves ergonomics as associates no longer need to bend, reach or stretch to reach items. It also stores and accesses items at lower and higher heights that would be unsafe for personnel to attempt without stretching or stooping. Further, the computer-controlled systems feature easy-to-learn, user-friendly interfaces that a new associate can quickly acclimate to after a minimal amount of training for maximum productivity in a short period of time.

3. Sustainability Savings. Thanks to their high-density design and automated operation, ASRS can reduce overall facility lighting, heating and cooling costs. Some are even used in completely lights-out operations. Additionally, they are ideal for harsh environments — such as cold and freezer storage — minimizing the need for personnel to enter and exit temperature-controlled zones and reducing associated expenses. Many systems are also engineered to harness the kinetic energy from the equipment’s movement and recycle it for to reduce an operation’s overall power utilization.

For additional assistance in calculating the potential ROI an ASRS investment can bring to your operation, connect with the members of the Automated Storage and Retrieval Systems Industry Group of MHI. The group also offers an interactive ROI Calculator on its website, and recently released an overview video on this topic that offers more details, here.