Optimizing Your Warehouse Layout for Automation

A warehouse’s layout is integral to operational efficiency, flow and productivity. Improper layouts can create bottlenecks and delays that negatively impact your bottom line. When introducing automated warehouse solutions, your business must prioritize proper warehouse organization to maximize the benefits of these solutions.

Several practical steps can help you assess your current layout and find strategic opportunities for improvement backed by data. Explore key considerations for optimizing your warehouse layout for automation to help your operation run faster and more profitably.

Top Benefits of an Optimized Layout

Reorganizing your warehouse does more than minimize problems or save time. It will also bring you and your organization new benefits that can transform daily operations and your bottom line for the better.

Advantages of optimized warehouse layouts include:

• Decreased operational costs: Optimized pathing through the warehouse reduces fuel costs for forklifts and automated guided vehicles (AGVs). It also means these vehicles can reduce their total workload, which can reduce maintenance demands and extend their lifespan. Optimizing the layout can even eliminate the need for additional storage facilities and other buildings. Together, these tweaks can result in enormous savings.
• Boosted output: More efficient pathing and an optimized layout can significantly increase your warehouse’s total output. Receiving, storing and shipping are all made easier, as each process has a designated area that is arranged specifically for that purpose. Faster processes mean more work gets done each day. More getting done means more money rolling in. It also means your team can better handle peak seasons.
• Improved warehouse safety: Cluttered, confused spaces make it harder for forklifts and AGVs to navigate the warehouse and make loading and unloading more difficult. This can lead directly to damaged items and injured team members. Between 2021 and 2022 alone, there were over 24,000 workplace incidents involving forklifts. A simplified, organized layout can significantly decrease the risk of these incidents.

Map Out Your Current Warehouse

The first step of optimizing your warehouse for automation is to assess the state of the current layout. This will help you identify bottlenecks and opportunities for improvement throughout the space. Creating a physical map and tracking the movement of products, people and vehicles throughout a typical workday can be very useful. The map should be as detailed as possible to gain more accurate and actionable insights.

In larger warehouses, it’s impractical to track every movement throughout the day. Instead, select a few key products, people and vehicles and monitor their movement. Internet of Things (IoT) technology and sensors can be especially helpful with this. They can give you real-time location data, which can then be collected and codified at the end of the day to get a sense of the common paths the current warehouse layout encourages. They will also help you:

• Notice if team members are constantly having to search for tools and inventory.
• Identify activity hot spots, spaces where bottlenecks that slow down warehouse processes are created.
• Spot commonly used shortcuts, which can indicate a need for a more efficient path.

The current storage system and practices should also be evaluated. Is every inch of storage space being used, both horizontally and vertically? Are the most-used areas and items easy to access? If the answer to either question is no, adjustments can be made to make better use of the space.

Plan Your New Layout Around Your Data

Once you’ve created your map and identified common bottlenecks and paths, it’s time to begin planning your new layout. Use the data you’ve acquired as the basis for each of the changes, but stay open to new approaches and ideas that accommodate automation and other considerations. For example, structuring the warehouse based on the stages of the logistics process is almost always a good choice.

Some of the most common building layouts include:

• U shape: This layout positions receiving and shipping on the same side of the warehouses. It is easier for all logistics teams to support one another and fill gaps during peak hours to ensure a smooth loading or unloading experience. The U shape also allows vehicles, both automated and otherwise, to move smoothly through the arc, rather than back and forth. This keeps them from getting in each other’s way. The loading bay can get crowded, however, so the U shape is best for smaller buildings.
• L shape: This warehouse layout starts with receiving on one end and shipping on the other, with a storage area in between. As with the U shape, the L shape creates a seamless flow through the stages of the logistics processes while making the storage area accessible to all. It also creates a slight separation between the loading and unloading teams, which can aid focus and speed things up. It may even make navigation easier for AGVs.
• I shape: The simplest of all layouts, the I shape offers straightforward logistics processes and separate shipping bays. As such, it is highly effective at processing large shipments quickly. It is also extremely easy for anyone to access the storage area and either of the loading bays at any time. If the areas provide wide, effective paths, this accessibility does not need to come at the cost of bottlenecks for the receiving or the shipping area.

Your building’s infrastructure will determine which of these layouts is viable. Creating an effective workflow is not reliant on a particular building shape, however. You can create more usable, functional paths by embracing the following techniques:

• Clear pathways: Designate clear, wide pathways for forklifts, AGVs and pedestrians, as per the Occupational Safety and Health Administration (OSHA) standards.
• Stack inventory: Maximize space by stacking the storage area as high and tight as possible while adhering to safety standards.
• Prioritize operational space: Ensure that conveyor belts, forklift charging stations and other machinery have the space to safely operate and be serviced.

When combined with the building layout as a whole, these practices will lead to a safer, more efficient and effective warehouse for your business.

Adjust the Layout for Automation

Your new layout can only go so far by solving the problems of the past. It must also embrace the technology of the future. For the warehouse, this often means automation. Conveyor systems, AGVs and other technologies promise to optimize logistics in revolutionary ways. These systems boomed in the aftermath of COVID-19, and they have shown few signs of stopping. This boom isn’t just a matter of convenience, either. They are popular because they offer robust benefits to logistics operations, including:

• Increased efficiency, whether in receiving, storing or shipping.
• Decreased risk of injury due to human error.
• Improved monitoring and data collection mechanisms.

Integrating this technology into your warehouse is not without its challenges, however, especially if you’re trying to integrate multiple forms of automation. Let’s walk through the receiving, storing and loading areas in turn to see how the layout of each can change to include automated systems.

Conveyor Belts and AGVs

These systems are your best friend when it comes to smoothing and optimizing the unloading process, but they do require significant infrastructure in order to be effective.

In order to install a conveyor system, you will need to make space for the track. Oftentimes, this track runs from the mouth of the shipping area to the storage area, but it can be placed wherever it is most useful. There should also be enough space so that the engine, belt, idlers and other components can be maintained and repaired easily. The belt’s placement should not prevent people and vehicles from moving through the space. If it does, it should be placed elsewhere.

Once the conveyor belt is installed, place hazard markings around the belt to signal clearly to team members and vehicle operators where the belt is. The conveyor belt controls should also be placed out of the way so that they aren’t damaged or used unintentionally.

AGVs facilitate a similar purpose without having to take up so much space. That said, they do still require a number of tweaks to the warehouse’s structure in order to work. Some rely on a charging system built into the floor along the path the AGV moves. Some AGVs utilize a digital twin system for their movement, while others move along a colored strip or length of magnetic tape attached to the ground. Either way, clear, consistent paths should be defined and marked before AGVs are used.

Automated Storage and Retrieval Systems (AS/RS)

The storage area — typically the largest, densest section of the warehouse — can also be enhanced with the power of automation. AS/RS allows you to store more and retrieve faster, which can both save space and make logistics processes more efficient. They can also reduce picking errors and the risk of dropping or spilling items.

AS/RS requires significant infrastructure changes, however. This often means altering your warehouse’s layout. Some AS/RS are primarily vertical, standing directly in parallel to the storage modules and taking up relatively little space. Others include a horizontal aisle at the base that allows extracted items to be easily loaded up and hauled away. So, before installing one of these systems, be sure your warehouse’s flow can accommodate those extra space requirements.

Order Picking Systems

If your warehouse does not have the space or resources to invest in AS/RS, then order picking systems may be the way to go. These mechanisms guide team members to the correct items and don’t take up the space that AS/RS do.

Pick-to-light systems, for instance, can indicate which items need to be unloaded and how many. These systems take up relatively little space, as they consist of simple panels that are mounted on the storage modules themselves. They require relatively little in terms of layout changes.

Voice-picking systems — headsets that help team members pick the proper items in the proper amounts — are also unintrusive. They do need to integrate with a warehouse management system (WMS) or an enterprise resource planning (ERP) software to work, but they don’t require much in terms of infrastructure otherwise.

Measure the Success of the New Layout

Once you’ve made the necessary adjustments to your warehouse’s layout, it’s time to measure its performance. This is a vital part of the process because it lets you know what is working and what isn’t. You can then adapt the layout to minimize problems and promote efficiency.

Your warehouse needs to track several different key performance indicators (KPIs), both before and after the changes. Some of the most useful include:

• Order picking accuracy: The percentage of orders picked without errors.
• Order cycle time: The average time from order placement to shipment.
• Safety incidents: The number of accidents and injuries.
• Total warehouse throughput: The number of orders shipped per day.

You can take these insights even further by assessing your return on investment (ROI). Start by assessing the total cost of the layout changes. Tally up the price of equipment, labor, installation fees and any other costs that came as a result of the layout change. Then, calculate the money your warehouse has saved from the increased productivity, reduced number of errors and the lowered cost of labor. Dividing the two numbers will yield your total ROI percentage.

This number will likely change over time, but you should still be able to observe where the data is trending. When combined with the KPI measurements, ROI provides a powerful insight into the effectiveness of your layout changes and how they might be altered to improve performance further.

Any changes made from then on can also be subjected to a KPI/ROI analysis to determine their effectiveness and guide future decision-making.

Streamline Optimized Warehouse Design With an Expert

Take the guesswork out of designing your warehouse layout for automation by partnering with the experts at Arnold Machinery Company. We offer a simulation-driven design process that visualizes your warehouse before you move a single rack.

Our Warehouse Design Simulation blends human workflows, material handling equipment, storage systems and processes into a data-backed layout that’s safer, faster and ready for modern automated tools and picking tech, from AGVs to conveyors.

Plan Your Warehouse Layout With Arnold Machinery Company

Planning a new warehouse layout can get complicated fast, especially if you’re trying to integrate new technology. But it doesn’t have to. With Arnold Machinery Company, you gain access to the experience and knowledge necessary to plan your layout to perfection.

We also offer new and used warehouse equipment, including forklifts and AS/RS. With us, you can take your warehouse to the next level. To learn more about our warehouse planning services, fill out our contact form or give us a call at 888-214-1847