Your Guide to Logistics Automation in Supply Chains

Businesses must closely plan, execute and monitor their logistic activities to thrive. Automation is therefore the key at each stage of the logistics process. It adds new levels of efficiency, accuracy, and flexibility to the transportation of goods or services.

The logistics automation market is expected to grow to $158 billion by 2032 from $52 billion in 2022, according to latest data.

Here are some key drivers behind the wide adoption of logistics automation: 

Enhanced Efficiency and Speed

The most obvious benefit of logistics automation is that it enables faster and more efficient operations. Automated systems can handle repetitive tasks such as sorting, packing and labeling with greater speed and accuracy than human workers.

Moreover, automated guided vehicles (AGVs) and autonomous mobile robots (AMRs) can expedite the flow of goods by handling the transportation of goods within warehouses.

For example, Amazon’s use of Kiva robots in fulfillment centers has set the standard in the sector: these navigate the floors of the warehouse, bringing rows of shelves to the human pickers, both speeding up the picking process and enabling tighter storage configurations.

Reduced Costs and Higher Margins

Automation reduces the cost of logistics operations. Fully automated systems run around the clock, removing the cost associated with worker fatigue and absenteeism. More fundamentally, automation reduces the risks of human error. Automatic and predictive maintenance algorithms can be applied to equipment to identify and fix machinery malfunctions before they arise.

Robotics and automation can streamline other business processes as well, especially inventory management. Automated systems deliver real-time information on inventory levels, making overstocking and stockouts less likely.

Improved Accuracy and Lesser Errors

Human errors in logistics can lead to significant disruptions, including incorrect shipments, lost items and delays. Logistics automation leverages technologies, such as barcode scanning, RFID tags, and AI-powered systems to ensure accuracy in tracking and managing goods.

For example, DHL has rolled out a picking technology called Vision Picking in its warehouses by providing its workers with smart glasses that show picking information and guide the individuals through the process. This technology has not only sped up the picking process but also minimized errors. The worker wearing the smart glasses can read information, scan items and view action instructions.

Enhancing Supply Chain Visibility and Transparency

Logistics automation technologies provide decision-makers with real-time visibility and oversight of their operations, increasing situational awareness and improving strategic planning. Sensors, IoT devices and sophisticated supply chain analytics provide more granular insights into the flow of goods, inventory levels, asset performance and the overall effectiveness of operations on a day-to-day basis. This transparency allows supply chain and procurement leaders to detect blockages, anticipate disruptions and improve efficiencies along the entire logistics process chain.

Such real-time tracking and data analytics also enable better communication and coordination with suppliers, manufacturers and distributors so that everyone is on the same page, and that communication and coordination flow smoothly across the value chain.

More Scalability and Flexibility

As businesses grow, their supply chains need to scale accordingly. Logistics automation offers the necessary scalability and flexibility for handling more products and adapting to changes in market demand. Automated systems can be easily reconfigured to accommodate new products, larger production volumes, or seasonal fluctuations.

Moreover, it’s the dynamic ‘just-in-time’ nature of automation in logistics that allows companies to fix their supply chain on the fly.

Driving Sustainability and Reducing Environmental Impact

Sustainability is now one of the biggest concerns for supply chains all over the world. Logistics automation can make major improvements in making supply chain operations more sustainable.

Automated systems are utilized to optimize routing and transportation that consumes less fuel and thus helps in reducing emissions. Not only this, the use of renewable energy sources and energy-efficient technologies in smart warehouses also makes the supply chain more environment friendly.

To Sum Up

Latest trends in supply chain automation are changing not only its functions but also the very essence of supply chain management. Improving shipping efficiency, reducing costs, accuracy, visibility, scalability and sustainability, logistics automation technologies will be driving a more resilient and robust supply chain – a future logistics professionals should be prepared for.

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