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Warehouse consolidation demands automation

  • 01-Jul-2018
  • Articles|Technical Articles


A few years ago, when VE Commercial Vehicles (VECV) wanted to increase the productivity and efficiency at its Pithampur plant, it opted for automated guided vehicles (AGVs) for material movement without any human intervention. With this, the company was able to raise the capacity of product line by 30 per cent. Today, VECV’s entire assembly line is using these robots. Examples like VECV are not uncommon today as companies are deploying for robotic systems to transform their supply chain. The Indian logistics and warehousing industry has been making steady transition from traditional manual processes to modern infrastructure with increased emphasis on automation. The logistics sector is expected to grow by more than 34 per cent from the current $ 160 billion to $ 215 billion by 2020. Warehousing, constituting about 60 per cent of the supply chain function, forms a crucial link in the overall logistics value chain. The Indian warehousing industry, pegged at about Rs 560 billion (excluding inventory carrying costs, which amount to another Rs 4,340 billion), is growing at over 10 per cent annually.
 
Warehouses, not only in India, but across the world have remained technologically starved for decades. In the past few years, with e-commerce booming, the pressure has increased on warehouses to adopt advanced robotics technology to ensure higher productivity and faster delivery. With logistics sector getting ‘industry’ status and GST unifying the market,there will be a rise in logistics and warehousing activities as companies are looking to consolidate their warehousing facilities. This entails fewer, but larger individual warehouses, which need automation to manage efficient operations smoothly.
 
Consolidation in logistics and warehousing sector is resulting in requirements of advanced handling technologies. High growth witnessed in H2 2017 and Q1 2018 by the material handling equipment (MHE) market is likely to be continued in the entire 2018.
 
Intense competition among the major players, in a price-sensitive market like India, makes customer retention a major task as cost of switching is low. At the same time, lack of standardisation among Indian MHE manufacturers is leading to high product variant within a range of product. For example, an electric stacker in India is offered with lift height greater than 6.0 m, though the international standard is 5.3 m. These are some of the challenges on the way to modernisation.
 
The potential of advanced technologies, including robotic logistics and cobots, to transform supply chain operations is evident, and it can be predicted that more and more companies will plan to switch to fullyautomated or robotised warehouses to enjoy its benefits - they are more flexible, cost effective, improve productivity and enhance space utilisation. As the industry moves towards large capacity warehouses, automated warehouses become vital for efficient operations. Battery-operated electric forklifts and warehousing equipment will be base of smart warehouses and pull the demand of battery-operated material handling equipment. The logistics and warehousing sector is at an inflection point, with GST, growth of e-commerce and the granting of infrastructure status. This will lead the next wave of growth for the sector. Do write in with your suggestions at feedback@IPFonline.com


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