The future of warehouse logistics

Innovative systems, robotics and artificial intelligence - the use of new technologies is fundamentally changing warehouse logistics. This affects the entire process chain - from the storage and movement of goods to order picking.

Robots are increasingly taking over the time-consuming work of picking, packing and transporting goods, minimizing errors and increasing efficiency. Automated high-bay warehouses enable faster and more accurate inventory management, while AI algorithms analyze vast amounts of data to predict demand and optimally manage stock levels.

The integration of AI-based software optimizes routes and task distribution in the warehouse, speeds up work processes and significantly reduces costs. These technologies not only ensure greater accuracy and reliability, but also offer incredible flexibility. They adapt effortlessly to changing requirements, whether sudden changes in demand or the introduction of new products.

In this webinar, we present two real-world contributions that show how the use of new technologies has made warehouse logistics more efficient, cost-effective and structured.

AI-based warehouse optimization in B2B retail

How can orders be prioritized, controlled and processed in such a way that warehouse processes can be optimized? Arne Lenz, freelance consultant at FREIGEIST-BERATUNG, gives an exciting insight into a project for a medium-sized B2B retailer for automation technology and cable management. The aim of the project was to optimize warehouse processes, reduce the workload of employees and significantly improve delivery times for customers.

At the start of the project, a comprehensive analysis of the company was carried out to identify weak points. Warehousing and order picking handling turned out to be high-priority "pain points". This led to the lighthouse project for warehouse optimization, which was launched in 2021. One of the main challenges was the manual handling of picking slips and the associated organizational effort, such as the prioritization and redistribution of orders. The aim was also to reduce the amount of walking required by employees. This was understandable, as 89% of order picking consisted of just one item.

Use of AI for process optimization

The use of AI became necessary in order to efficiently control several factors that could not be influenced, such as staff availability and incoming orders. The AI was to replicate and optimize the creative decision-making process of the human team leader. To this end, information about personnel, orders and materials was fed into the AI.
The implementation took place in several steps: First, two days were used for workshops and on-site analysis to record the processes and data. This was followed by five days for data preparation and the creation of a prototype. It took two months to fully integrate the AI solution into the existing SAP system and warehouse management.

Advantages and successes of the AI solution

The AI-based software enabled automated and more efficient prioritization and distribution of orders. Employees were assigned their tasks digitally via Zebra scanners, replacing the paper-based process and increasing transparency in the warehouse. A live monitoring system provided an overview of the status of orders at all times.
According to Mr. Lenz, the total cost of the project was 65,000 euros, with 5,000 euros spent on the analysis and prototype phase and 60,000 euros on implementation. This illustrates that efficient AI-based warehouse optimization can also be implemented with a comparatively low budget.

Future steps

Further steps are currently being discussed, such as the implementation of Autostore systems to further automate and optimize warehouse processes. To summarize, Arne Lenz clearly shows how the use of AI has significantly improved the warehouse processes in the medium-sized B2B company. The successful implementation of the project within a few weeks and on a low budget proves the potential of AI to increase efficiency and optimize delivery times for customers. Employees benefit from the reduced workload and increased transparency, which ultimately optimizes the entire operation.

Field report on the introduction of an automated storage and retrieval system

Sebastian Bayer, IT Application Manager at Eduard Lutz Schrauben-Werkzeuge GmbH, reports in his presentation on his experiences with the introduction of an automated storage and retrieval system. Founded in 1946, the family-run company has five locations and currently employs 243 people. It offers high-quality screws, tools and fasteners, with a focus on innovation and sustainability.

Before the new system was introduced at the Gersthofen logistics center, logistics consisted of floor storage, a two-story shelving system and a pallet warehouse. The long distances, high error and return rates and long training periods for new employees made daily operations and company growth difficult. These bottlenecks made high-performance logistics a necessity.

Decision in favor of the new warehouse system

Internal factors such as the expansion of the locations and external influences such as the shortage of skilled workers and changing customer expectations led to the decision to introduce a new warehouse system. The objectives were to optimize material flows, provide greater flexibility for customers and make processes more efficient.

Project progression: from planning to implementation

The project began in 2017 with fundamental considerations and process analyses. Various warehouse technologies were tested in 2018 before the decision was made in favor of the AutoStore warehouse. The processes and systems were then coordinated from 2019 to 2020, and construction began in October 2020. The relocation of around 33,000 items to the new warehouse took place from December 2021 to January 2022. The AutoStore warehouse currently comprises 18 picking robots and 27,500 boxes for more than 36,700 items. Despite initial challenges, the change process was successful and almost all employees were brought on board.

Advantages of the implementation

Before the new system was introduced, picking was paper-based and based on the "man-to-goods" principle. This also meant long walking distances. In addition, the error and returns rate was high; there were regular stock discrepancies and logistics was often behind schedule. Following the implementation of the AutoStore warehouse system, picking is carried out on a daily basis and paperless. The new "goods-to-person" principle has significantly reduced walking distances. The training time for new logistics employees has also been reduced from around 3 months to around 15 to 30 minutes. The error and returns rate has fallen considerably and there are now virtually no more stock inconsistencies. Overall, the workload of employees has decreased significantly and with it the sickness rate.

Future plans: further development of logistics

In the future, Eduard Lutz Schrauben-Werkzeuge GmbH plans to use robotics in the incoming and outgoing goods process, driverless transport systems and the use of AI for product data maintenance. The processes are to be continuously adapted in order to remain efficient.

What challenges and opportunities does the integration of AI systems in warehouse logistics present?

In the subsequent discussion round, there was a strong interest in the practical applications and benefits of AI and automation systems in warehouse logistics. The participants were particularly interested in the challenges that can arise when integrating them into existing systems.
A central topic was the training of AI. The participants asked what specific data is needed to train the AI and how employees are involved in this process. This also included questions about the definition of priorities and synonyms that are important for the AI.
The panel was also interested in the comparison between existing ERP systems and AI solutions. Here, the question arose as to whether the functions of AI are absolutely necessary or whether existing systems could take over similar tasks.
Finally, future applications for AI in warehouse logistics were discussed. The participants inquired about other potential applications of AI, particularly in areas such as inventory management, slot management and automated packaging.
Overall, the questions and discussions showed that there is great interest in the practical implementation of AI technologies and their integration into existing systems. There was also a strong interest in the future possibilities of automation in warehouse logistics.

In the webinar series "From research into practice", research institutions and companies provide insights into current research activities and discuss these with participants. The aim is to support small and medium-sized companies in particular in making meaningful use of digital technologies in their production processes and engineering.
You can contact the team from the Mechatronics & Automation Cluster of Bayern Innovativ in person or via the email address CMA(at)bayern-innovativ.de.

Arne Lenz
Freelance consultant, FREIGEIST-BERATUNG
Contact by mail

Sebastian Bayer
IT application, Eduard Lutz Schrauben-Werkzeuge GmbH
Contact by mail

The webinars from the "From research to practice" series take place every 2 months on Thursdays from 13:00 to 14:30.
Participation in the event is free of charge.

The next event will take place on 10.10.2024.

Further information on the webinar series