Warehouse automation is gaining traction in modern logistics. It integrates advanced robotics, computer systems, and specialized sensors to enable advanced capabilities like robotic order packing, AI-driven equipment analysis, and automation software for self-driving vehicles. Warehouse automation solutions not only boost efficiency but also enhances safety and reduces costs.
Some stats, per Robotics Business Review. Automated warehouses —
Smart warehouses, powered by IoT and AI, utilize real-time data to enhance productivity and cut costs. With over 11,000 smart warehouses in North America, Amazon leads the charge, deploying 750,000 robots across its facilities in 2023—an increase of over 40% from 2022's 520,000 robots.
Needless to say, smart warehouses and warehouse technology are driving a significant surge in investment.
52% of warehouse managers anticipate increased spending on automation and robotics in the coming years, and according to Deloitte, 96% of industry leaders deem innovation crucial for growth. As we look closer at the landscape of warehouses in 2024, we’ll uncover everything you need to know about the trends driving the demand for intelligent automation.
According to Logistics Management, in 2018, warehouse management system adoption topped 90% for the first time while paper-based picking system use, previously common before WMS, dropped by 60%.
This warehouse management trend is being driven by fluctuating market demands, causing major organizations to adopt more scalable solutions that allow them to adjust inventory and storage in real time as their business grows. These systems, such as Oracle NetSuite WMS and SAP Extended Warehouse Management, use data integration and automation to streamline tasks like order picking, shipping, and inventory measurement.
Almost every major company uses both warehouse automation and management software. For instance, Walmart uses a cloud-based WMS to coordinate and manage inventory across stores and distribution centers, allowing it to achieve its targeted inventory levels.
Collaborative robots (cobots) are emerging as an adaptable solution for dynamic environments. In comparison to traditional industrial robots, which have sparked concerns over job displacement, cobots work alongside human workers, augmenting the workforce.
For example, with the implementation of these warehouse robots, human workers can devote their time to tasks requiring creativity and problem-solving, while robots can handle more repetitive jobs like inventory management and material handling. Through this collaboration, human-cobot teams have been found to be 85% more productive than teams composed solely of robots or humans.
Beyond facilitating more efficient collaboration, cobots also help to significantly boost safety.
Over the last two decades, artificial intelligence (AI) and machine learning has significantly advanced and had a profound impact on the industrial world. This impact extends to warehousing technologies, where AI plays a key role in enhancing operational agility and decision-making. With AI adoption continuing to grow, around 42% of warehouses and distribution centers plan on further investing in artificial intelligence in the near future.
Automotive manufacturer, Mahindra and Mahindra, has used AI and predictive analytics to increase forecast accuracy by 10%, contributing to an increase in service levels by 10% and a reduction of inventory investment by 20%. Aniruddh Srivastava, their Head of Demand and Supply, called AI “the cornerstone of their strategy.”
The trend of Industrial Internet of Things (IIoT) integration in warehouse automation systems stems from the need for enhanced operational efficiency. By connecting various devices and systems, IIoT enables warehouse workers to gain not only better visibility in their operations, but also be able to complete tasks with greater precision.
RFID tracking enhances visibility, accuracy, and efficiency in warehouse logistics and inventory management by utilizing radio frequency identification technology to automatically identify and track items in real-time. Most commonly, barcode scanners scan parcels before shipping, eliminating manual data entry errors and enabling warehouses to efficiently monitor inventory movement throughout the supply chain.
In addition to using cloud-based WMS, Walmart is also one of the earliest adopters of RFID technology. As early as 2006, the company mandated all incoming pallets of product to contain RFID tags. Today, Walmart has expanded the RFID technology mandate to cover all products sold in U.S. stores, enhancing supply chain visibility and enabling customers to access real-time inventory levels in store.
Wearable technology, such as smart glasses and wearable scanners are transforming warehouse operations by enabling workers to access real-time information and instructions hands-free. By doing so, the technology has the potential to enhance worker efficiency, safety, and productivity.
Take, for example, a scenario where a warehouse worker wears smart glasses while picking orders. These glasses project picking instructions and the precise location of each item directly onto the lens, thereby reducing errors and expediting the picking process.
Alongside improving efficiency, companies like Microsoft and Vuzix provide warehouse workers with augmented reality glasses that improve worker safety by providing real-time alerts and warnings about potential hazards or unsafe conditions in the environment. This could include elevated temperatures or unsafe movements, ensuring a safer work environment for employees.
In recent years, there has been a notable shift from outright vehicle purchases to rental and license models. For instance, we have already seen the “as a service” paradigm move from cloud-based software to hardware. However, today, this shift is evident in Robotics-as-a-Service (RaaS), a subscription-based model that allows organizations to rent assets such as vehicles from service providers.
As warehouses continue to face supply-chain bottlenecks and labor shortages, Cyngn’s VP of Business Development, Ben Landen, describes RaaS as a model that allows organizations to “mitigate the negative impact you might feel from workforce issues.” As a result, ABI Research predicts that there will be 1.3 million RaaS installations by 2026, generating over 34 billion in revenue.
Predictive maintenance also plays a crucial role in industrial automation by proactively identifying potential equipment failures before they occur. Warehouses will see improved safety as this technology ensures that equipment is always operating at optimal condition. According to Mckinsey, predictive maintenance has been shown to not only reduce machine downtime by 30-40%, but also increase a machine’s lifespan by 20-40%.
Leading predictive maintenance platforms like IBM’s Watson IoT Platform and Microsoft’s Azure IoT suite leverage the capabilities of IoT, advanced analytics, and machine learning capabilities. In a warehouse employing robotic arms, for example, these platforms can anticipate potential equipment failures. Equipped with AI-driven sensors, these robotic arms continuously monitor their performance metrics, with any deviations prompting instant alerts via the platform. This warehouse automation solution ensures timely repairs and uninterrupted operations.
With the increasing need for efficient utilization of warehouse space and the demand for faster order fulfillment, AS/RS systems have risen to replace conventional storage methods. These systems, including carousels, unit load cranes, and shuttles, utilize robotic arms and computerized controls to accurately manage inventory, optimizing storage density and minimizing wasted space.
As a result, AS/RS systems enable warehouses to handle higher volumes of inventory with greater accuracy and speed, making them well-suited for the increasing demands of e-commerce and omnichannel retail.
Read more: What are the Differences Between AGVs, AS/RS, and AMRS?
Projected to grow to $3.3 billion by 2028, the automated guided vehicle (AGV) market continues to capture the attention of warehousing for their ability to reduce labor costs, increase throughput, and enhance safety by minimizing the need for manual material handling.
Following predetermined tracks such as magnetic tape or laser navigation, these vehicles transport goods without human intervention and are more flexible and intelligent than AS/RS systems. They are commonly used for transporting raw materials such as plastic, paper, rubber, and metal. For instance, by deploying a fleet of AGVs to transport bulk materials, paper manufacturer, Clairfontaine, automates heavy lifting and reallocates its workforce to safer, more satisfying tasks.
In addition to AGVs, the autonomous mobile robot (AMR) market is also growing at an impressive 17.5% per year and is anticipated to reach $4.1 billion by 2028. These warehouse robots are revolutionizing warehouse operations due to their versatility, flexibility, and ability to navigate complex environments without requiring fixed infrastructure.
However, in comparison to AGVs, these mobile robots use complex artificial intelligence, machine learning, and advanced sensors to navigate independently. As a result, they can easily adapt to changing warehouse layouts and workflows, as well as be scaled up or down to match changes in demand.
One example illustrating their benefits can be seen at U.S. Continental, a leading provider of leather and fabric care solutions, where Cyngn’s AMR took on pallet transportation. After a brief integration period, the company not only experienced a 4x increase in efficiency, but also facilitated the promotion of a former forklift driver.
According to Logistics Management, 22% of warehouses are currently using some form of voice-directed technology, with voice picking being the most common. Voice picking enables warehouse workers to fulfill goods-to-person tasks by using voice commands and responses, eliminating the need for handheld devices or paper-based picking lists.
DHL is among those utilizing this technology. At their logistics center in Essen, Belgium, DHL workers can simply speak commands into a headset, receiving verbal instructions for navigating the warehouse with greater efficiency and accuracy during the item picking process.
Autonomous fleet management systems (AFMS) play a key role in making AGVs and AMRs more intuitive to manage, monitor, and command by enabling autonomous operation of vehicles within the warehouse. This logistics trend enables organizations to optimize fleet operations, reduce downtime, and enhance efficiency.
In addition, AFMS are designed to be quickly implemented in a facility. For example, Cyngn’s AFMS is simple and straightforward to operate, and can be adapted into existing workflows to make teams more efficient. In fact, it’s so easy to use that teams can be trained before lunch.
It can take human workers 90 days to scan all inventory within a large warehouse whereas drones can do the same job in just 3 days. As a result, warehouse drones are increasingly transforming the way goods are managed and moved within facilities. With a 99.7% inventory audit accuracy rate, specialized drones can navigate aisles, scan inventory, and even transport small items from above, offering a new level of efficiency and accuracy in warehouse logistics.
By significantly reducing the time spent on inventory management, workers can focus on more rewarding tasks. For instance, Progressive Logistics, a provider of logistic management solutions, is using drones in its own warehouse to scan inventory across its facility within minutes. This implementation has resulted in significant time savings, allowing them to save hours on routine inventory checks.
With a 99% accuracy in picking and sorting, put-to-light and pick-to-light systems are another trend streamlining warehouse operations by guiding workers to the precise location of items for picking and packing. For example, companies like Falcon AutoTech and ekko are creating systems that utilize visual cues, such as lights or displays, to streamline the process. This approach minimizes errors, enhances order accuracy rates, and accelerates fulfillment times.
The development of digital twin technology in warehouses has been fueled by advancements in simulation and modeling techniques, enabling the optimization of warehouse design and operations. This involves replicating workflows or entire warehouses to enhance layout, identify bottlenecks, and visualize operational improvements, which all play a role in defining the future of logistics.
Furthermore, digital twin technology can be used for predictive maintenance capabilities, a trend we’ve already identified, with some companies reporting a 13% reduction in maintenance costs and a 15% increase in efficiency.
Finally, the importance of sustainable practices, or green logistics, in modern warehouse automation is continuing to grow due to significant cost savings, governmental requirements, and brand reputation. Today, businesses are prioritizing efforts to reduce their environmental impact and align with evolving regulatory requirements.
In addition, there’s a strong consumer preference for environmentally-conscious companies, with 84% of consumers believing poor environmental practices will alienate them as a company. One solution to this is the increased adoption of automated solutions, from energy-efficient conveyor belts to robotic systems.
Through the integration of advanced robotics and remote control technology, teleoperations is the final key trend we’re seeing in 2024. This technology enables the remote operation and supervision of vehicles and machinery from thousands of miles away.
As a result, organizations can access a remote workforce with lower wage expectations and reduce the risk of workplace accidents and exposure to hazardous environments. With more than 7,000 forklift-related accidents happening per year since 2012, teleoperations have emerged as a safer approach for forklift and other industrial vehicle operators while also enabling companies to tap into a global pool of talent.
By exploring the 15 trends, we can see that technological advancements are shaping warehousing in 2024. Now, let’s explore the different market trends influencing the industry and driving the need for warehouse automation. From tackling labor variability through automation to the rise of micro-fulfillment centers, warehouses are evolving to meet the demands of a rapidly evolving landscape.
According to a study conducted by Descartes, 76% of today’s supply chain operations are being impacted by substantial labor shortages. Particularly, 41% of warehouse managers have reported an inability to attract and retain workers. As a result, addressing labor variability challenges in warehousing has become paramount and driven the need for automation to mitigate the effects.
As stated in Forbes, “If you can't get people to take certain jobs that need to be done, then the next best thing is accomplishing the tasks without a human doing the work.” Warehouses are increasingly adopting this mindset as a solution to labor challenges. By automating repetitive and mundane tasks, warehouses can reallocate existing workers to higher value jobs, improving operational efficiency and productivity.
The demand for same-day delivery for e-commerce sites has surged in recent years and is characterized by consumers' desires for faster, more reliable, and more convenient shipping options. This desire is forcing warehouses to adopt more agile and efficient operations to meet customer expectations.
To cope with this demand, companies like Amazon and UPS are implementing strategies such as micro-fulfillment centers and automated picking systems to expedite order processing. By adopting this technology, warehouses are able to adapt their logistics processes and remain competitive.
The rise of micro fulfillment centers signifies a shift towards more localized and efficient order fulfillment strategies, which is driving these warehousing trends. Along with demand for same-day delivery, warehouse rents have surged by 28.7% and are expected to continue rising. This presents organizations with a significant cost-saving opportunity by leveraging micro-fulfillment centers for their operations.
These small-scale warehouse facilities utilize automation technology to efficiently fulfill online orders, typically located near urban areas to enable fast delivery to customers. In addition, they often use a variety of automation solutions, such as AGVs, AS/RS, and robotic picking systems, to enhance efficiency and to deliver fast order processing features like same day delivery.
Originally fueled by the COVID-19 pandemic, the trend of online grocery retail is expected to increase at an annual rate of 12% over the next five years. Warehouses are adapting to accommodate the unique demands of perishable goods and frequent order turnovers associated with online grocery retail. To meet these challenges, organizations are having to implement efficient inventory management systems and temperature-controlled storage solutions.
Warehouses are leveraging predictive analytics and automation to derive actionable insights from vast amounts of data within their facilities. Valued at $274 billion and experiencing exponential growth, big data has allowed warehouses to implement data-driven decision-making processes, allowing them to stay productive and agile.
One way to leverage warehouse automation in 2024 is to incorporate Cyngn’s fleet of self-driving AMRs to automate material transport. Our DriveMod-enabled BYD Forklift, Motrec Tugger, and Columbia Stockchaser can make intelligent, real-time decisions, allowing organizations to minimize safety risks and optimize workflows.
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