Warehouse Automation Buyers Guide
A Complete Guide to AS/RS
White paper
Warehouse Automation Buyers Guide
A Complete Guide to AS/RS
by Dan Labell, president, Westfalia Technologies, Inc.
One indisputable fact exists for most manufacturers
and distributors: Warehouse automation stands as
one of the last areas where long-term costs can be
significantly reduced.
on-site training, maintain parts in inventory, and
operate 24/7 support centers. Vendors have a vested
interest in customer success. They want repeat
business as well as referrals and references.
Given this fact, the decision to implement an
Automated Storage & Retrieval System (AS/RS) should
be an easy one to reach. Yet, many executives have
reservations that center on two distinct, yet
interrelated, issues. The first concern is captured in
the question: “What happens if the AS/RS breaks
down?” The second issue focuses on implementation
cost: “How will I be able to afford an AS/RS?”
Cost presents far different considerations. As in all
major capital purchases, basing acquisition decisions
on the purchase price alone is shortsighted. First, it
may totally eliminate quality from the equation.
Further, it fails to consider the long-term value an
AS/RS delivers. It is important to remember that over
a 25+ year life cycle, the significance of the initial cost
lessens when evaluating the annual benefits, which
are usually related to labor cost reductions, smaller
footprint, and higher customer service levels.
AS/RS technology has come a long way in recent
years. Component materials have never been
sturdier, and engineering designs are thoroughly
vetted. Warehouse Management System (WMS) and
Warehouse Control System (WCS) software has
undergone numerous refinements and operates
almost flawlessly. Most AS/RS vendors recognize the
importance of customer service and employ
well-trained staff, offer their customers complete
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A high-tech Automated Storage & Retrieval System
(AS/RS) offers companies the ultimate combination:
a 20-25+ year lifespan with ROI achieved in 5 years
or less. Warehouse automation via AS/RS thus offers
firms many years of cost savings and profit potential
arising from:
• Optimized space utilization. An AS/RS can store 40%
more pallets in the same space as a
conventional rack warehouse.
• Reduced labor and equipment costs. Although
every warehouse situation is unique, a single crane
operated by three staff members across three shifts
can do the same work as nine forklifts and nine
employees.
• Less waste. An AS/RS results in less product damage,
and theft is eliminated by “locked” inventory. Further,
stretch wrapping costs decrease because less wrap is
needed to secure goods on a pallet.
• Lower maintenance costs. Forklift leasing and
maintenance costs (battery charging station, battery
replacement and general cleaning costs) generally
exceed normal AS/RS maintenance requirements.
• Lower energy costs. Especially in refrigerated and
frozen warehouses, businesses experience lower
energy costs, often on the order of 30% or more. An
AS/RS allows businesses to operate using less square
footage and in a tighter cube, with smaller ingress/
egress openings. Thus, there is less space to cool.
These are just some of the reasons why companies
worldwide are investing in high-tech AS/RS. Better
still, the efficiency gains realized through optimized
warehouse operations and the cost savings accrued
via maximized space utilization are only expected to
rise as new innovations advance the technology.
UNDERSTANDING AS/RS
An AS/RS comprises five essential components:
1. A rack system to store product
2. A crane/SRM (storage retrieval machine) that runs
on a floor rail
3. A load-handling device/shuttle to move product
from the crane to the rack location
4. A conveyor system to move goods to and from the
AS/RS and dock areas
5. Warehouse management and material flow control
software (WMS, WCS) to control, track and optimize all
product movements
An AS/RS can be installed in an existing facility or
designed specifically for a new facility. Most
systems can go as high as 130 feet (these are typically
rack-supported buildings), and some can be installed
in buildings as low as 20 feet (these are generally
conventional buildings).
As stated above, an AS/RS can store approximately
40% more pallets in the same space as a conventional
rack warehouse. Why? An AS/RS can go higher and
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be more compact. These characteristics translate into
more storage capability within a much smaller space.
In the instance of building a new warehouse,
integrating an AS/RS means the building footprint
can be considerably smaller, reducing construction
and maintenance costs. For existing facilities, business
growth can be accommodated within existing space,
avoiding costly expansion and maintenance costs.
Regardless of a company’s building size and product
throughput requirements, an AS/RS can be designed
and installed that yields economy, efficiency and
unprecedented space utilization.
Lower volume SKUs are typically handled differently,
in lane depths suited for their inventory levels.
AS/RS DESIGN
Modern AS/RS implementations can be flexible hybrid
systems. In a hybrid configuration, some lanes are
single deep, some are double and some are multiple
deep (3 to 12 pallets deep). Thus, AS/RS design can
match a client’s item/SKU mix and its varying product
throughput rates. An intelligent WES is the secret to a
successful hybrid system, enabling the use of
different lane depths and storage of different SKUs.
Should the hybrid AS/RS require expansion to meet
future growth, aisle lengthening and storage lane
extension can be accomplished easily.
For purposes of this white paper, examples use pallet
loads. However, the same technology exists for
moving totes, cases, paper rolls, bakery trays and even
large car-sized platforms.
System configuration — and the number of aisles
needed — depends on product mix and throughput
rates. Thus, customer-provided data regarding the
number of items/SKUs, product throughput rates and
more are critical to AS/RS design. Merely receiving the
data is not enough, however. System designers must
understand the customer’s data to develop a design
that maximizes all the technological advantages
possible and optimizes the results the AS/RS delivers.
Product can be stored in locations/lanes with pallets
placed single, double or up to 12 pallets deep.
Selecting the correct lane depth and designing the
AS/RS to that depth are critical steps in achieving the
high throughput rates fast-moving SKUs demand.
Today, two cranes/SRMs can be placed in the same
aisle, an AS/RS innovation made possible by greater
flexibility in controls and Warehouse Execution
System (WES) software. So, if anticipated throughput
increases are projected over the short term, the
addition of a second crane in one aisle can handle
them with ease. Plus, the second crane provides
redundancy should the other be undergoing routine
maintenance.
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AS/RS CAN ACCOMMODATE ANY PICKING STRATEGY
An AS/RS can integrate diverse order picking strategies in a variety of ways. It is possible to incorporate pick
tunnels within the rack structure to operate with pick-to-light, pick-to-belt and pick-to-voice technologies.
In the case of fast-moving products, pallet flow picking lanes can be automatically replenished by the SRM,
when guided by a WES in-sync with the crane/SRM and providing constant updates on current inventory
levels. When slower-moving products are involved, they can be organized and replenished in dynamic pick
lanes. In this scenario, SKU exchange will be ongoing based on the product requested for picking.
Notably, newer AS/RS designs integrate the cranes pick-up and drop-off conveyors within the rack, instead
of just at the end of the aisle. This innovation adds accumulation to feed SRMs, as well as reduce the average
travel distance of an SRM. Throughput rates per SRM can often increase by 10% to 20% if infeeds/outfeeds
are located near the middle of the aisle versus the end.
RULES TO FOLLOW WHEN INVESTING
There are five simple rules to follow when investing in warehouse automation:
1. Purchase high-quality equipment. Lowest cost does not equate to the best business deal. Any perceived
initial cost savings will soon be replaced by expensive equipment down-time and costly repairs.
2. Take a long view. No business success is achieved overnight. Most involve progressive steps implemented
over time. With a 25+ year life cycle, it is unrealistic to think an AS/RS can pay for itself in 12 months.
3. Bring in operating personnel early-on. Do not wait until the system is about to go live to involve staff.
Operating personnel should be part of the project team from the start.
4. Be proactive. It is less expensive to follow recommended preventive maintenance schedules today than
to skip them and pay for major repairs tomorrow. Delays that create dissatisfied customers are “hidden costs”
that can be avoided totally by following expert recommendations.
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5. Select the AS/RS vendor carefully. If a company does not possess credentials in the industry vertical in
which you operate, find a vendor that does. Understanding your business and your unique requirements is a
prerequisite to a successful implementation. Identify a vendor that sticks to the fundamentals, stays within its
core competencies and has the vision to identify with your problem domain.
While these rules may seem simplistic, they are guiding principles that all firms should follow. Adhering to
these five fundamentals will assure the purchase of a high-quality AS/RS that will yield economic benefits for
the next 25+ years.
It is no understatement to say that purchasing low-cost, low-quality warehouse automation machinery is
often more expensive than staying with a manual system. So, commit to the decision to automate and do it
properly. It is not the time to skimp on quality. You get what you pay for when it comes to technology and
expertise.