2014 Warehouse/DC Equipment study reveals increasing interest in automation and software

For many key figures in retail distribution, the results of the State of Warehouse/DC Equipment and Technology Survey, conducted by Peerless Research Group, make required reading. The Logistics Management website reports that the latest study shows automation and software becoming an ever-greater focus for spending in the sector, with decisions being significantly influenced by workforce issues.

Such trends are recorded on the backdrop of an industry continuing to adjust to such events of recent years as the boom in e-commerce and the global economic slowdown, together with the emergence of increasingly sophisticated materials handling equipment and software. The effects have been seen in the instability in average anticipated spending levels from one year’s survey to the next, with rises as high as 15 per cent and falls of up to 26 per cent both being recorded since 2010.

Nonetheless, this year’s figures make pleasant reading for the major decision-makers in retail distribution, with activity levels as a percentage of capacity not having been this high since 2007. In addition, over the next two years, 95 per cent of respondents expect to increase their activity levels, by an average exceeding 20 per cent, or to maintain present levels.

The survey also shows a rise in the proportion of respondents “proceeding with investments”, from 19 per cent to 27 per cent, while a “wait and see” attitude was adopted by 43 per cent in the most recent poll, down from the previous 50 per cent. This does not tally, however, with a downward trend in spending, suggesting that the retail distribution landscape is now seeing more targeted investment decisions following a period of hefty expenditure.

The Logistics Management report stated that there were heightened activity levels in manufacturing (from 2012’s 63 per cent to 75 per cent), warehousing supporting manufacturing – from 56 per cent in 2011 to 69 per cent now – and standalone warehousing, which recorded 68 per cent in the most recent survey, up from 60 per cent in 2011. Such growth was largely attributed to “doing more with less”, as existing facilities were optimised rather than new ones built.

There were also signs that automated processes would become more fundamental to retail distribution over the next two years. The number of respondents presently evaluating productivity using automation was some way shy of those anticipating a transition to automated approaches over the coming 24 months. Respondents clearly felt that technology and equipment investments would continue to drive improvements.

Director of research for PRG (https://www.prolog.co.uk), Judd Aschenbrand commented: “Technology is expected to become even more critical in the upcoming years as a growing percentage of operations plan to automate inventory control and handling, distribution processes, and labour management. In warehouses and DCs, continuous improvement, workload planning, and lean processes are key initiatives going forward.”