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Building the Business Case for Distribution Center Automation

Dustin Crandall | 06 February 2020

Your business is growing, your organization’s sales division is offering more and more SKUs, marketing strategies are driving sales to all available channels, and your distribution center (DC) operation is having trouble keeping pace. Sound familiar? If so, you are probably considering modernizing your DC. While there is often a compelling ROI for automating your DC operations, there are several other key factors that should also be considered when building your business case.

Productivity and Asset Utilization

Automated solutions, such as voice/light-directed picking and packing, high-speed conveyors, auto-guided vehicles (AGVs), robotic palletizers and automated storage and retrieval systems (ASRS), are tools that can be used to maximize the efficiency and productivity of your reliable, full-time workforce. High asset utilization can also be achieved since many types of automation can run continuously throughout days, nights, weekends and holidays.

Hiring and Retaining Skilled Labor

The costs associated with hiring and training employees, both full-time and seasonal, can be significant. This is especially true for operations who suffer from a high turnover rate. By reducing the amount of labor required, automated solutions can bring throughput capabilities in highly competitive markets with a shortage of skilled labor.

Space Utilization

Automated technologies can be designed to maximize the space utilized within your existing DC or reduce the space requirement for new facility.  High-density AS/RS can store more products in a smaller footprint than conventional rackConveyors, sortation equipment and robotic technologies can be mounted to walls, installed within shelf systems, suspended from ceilings or located on platforms overhead. 


Automated technologies do not get tired and they do not get distracted. They can produce consistent, high-quality output because tasks are executed accurately and precisely time and time again. It is highly likely that quality levels decrease as volumes increase, especially if a large amount of seasonal labor must be utilized during peaks. In contrast, quality levels produced by automated solutions remain near constant as volumes increase.

Inventory Accuracy and Product Damage

Implementing automated solutions should reduce the number of human interactions with inventory. Fewer touches equates to fewer opportunities to misplace or damage product. 

Shipping Accuracy

Warehouse software, such as warehouse management systems (WMS), warehouse control systems (WCS) and transportation management systems (TMS), can be coupled with automated print and apply applications and high-speed sortation equipment to attain a high degree of shipping accuracy. These technologies work together to ensure orders are labeled properly, sorted to the right shipping lane, and loaded onto the correct pallet/trailer. 

Safety and Ergonomics

Goods-to-person applications decrease the amount of walking, pushing, and bending workers need to perform. Robotic loading and unloading technologies eliminate twisting, bending, and lifting movements. AS/RS can be deployed inside freezers, eliminating the need for workers to be exposed to sub-zero temperatures. 

No matter what business problem you face, there is most likely an automated technology (or combination of technologies) that can be selected to provide a cost effective and compelling solution for your operations

Author: Dustin Crandall

Dustin is a Consulting Engineer at Bastian Solutions. Dustin has over 10 years of experience in process engineering, conceptual design, and project management. Dustin attended the University of Missouri – Columbia where he earned a B.S. in Industrial Engineering. Outside of work, Dustin is an active member of Missions of Mercy, a ministry that provides charity and aid to homeless individuals in Houston, Texas.


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