Top 10: Digital Warehousing Solutions

Digital warehousing is transforming supply chains through advanced technologies such as warehouse management systems (WMS), IoT devices and robotics.

The global digital warehousing market is expected to be worth US$21.9bn by 2026, yielding benefits such as improved inventory tracking, reduced operational costs and enhanced decision-making.

IoT sensors can reduce inventory loss by up to 30%, while autonomous robots increase picking accuracy to 99.9% and cut labour costs by 70%. This is becoming increasingly essential to keep up with the competition and with customer demand in industries such as e-commerce which are seeing a rise in online consumption. 

Here, Supply Chain Digital takes a look at the top 10 digital solutions companies are leveraging in their logistics warehouses. 

10. Radio Frequency Identification (RFID)

Radio frequency identification (RFID) is a technology that uses electromagnetic fields to automatically identify and track tags attached to objects.

These tags contain electronically-stored information, which can be read from a distance without requiring line-of-sight.

Nike employs RFID technology in its distribution centres to enhance inventory tracking. By tagging products with RFID, Nike can monitor their movement in real-time throughout the supply chain, improving visibility, reducing loss and optimising stock management.

9. Drones

Drones, or unmanned aerial vehicles (UAVs), are aircraft controlled remotely or autonomously. They are playing an increasingly important role in modern supply chains.

Walmart has integrated drones into its warehouses for inventory management, where they scan shelves and track inventory levels.

This use of drones provides real-time data, significantly speeding up and enhancing the accuracy of inventory processes. By automating these tasks, Walmart optimises its supply chain efficiency, reducing labour costs and ensuring better stock management.

8. Warehouse management systems (WMS)

A warehouse management system (WMS) is a software solution designed to optimise the storage, tracking and movement of inventory within a warehouse.

Amazon employs its proprietary WMS to manage inventory and streamline order fulfilment across its extensive network of fulfilment centres. This system integrates seamlessly with robots and other automation tools, enhancing efficiency and accuracy in warehouse operations.

Amazon's WMS ensures faster processing times and better inventory control, contributing to its industry-leading supply chain.

7. IoT

The Internet of Things (IoT) refers to the network of interconnected devices that collect and exchange data through the internet.

DHL’s "Smart Warehouse" initiative leverages IoT sensors to enhance warehouse operations. These sensors monitor key factors such as temperature, humidity and equipment status, ensuring optimal storage conditions and enabling proactive maintenance.

By integrating IoT technology, DHL improves efficiency, reduces risk and maintains high standards in its warehousing processes.

6. Augmented reality (AR)

Augmented reality (AR) overlays digital information onto the real world, enhancing the user's perception with visual elements.

Zara employs AR glasses to support warehouse workers in picking and packing tasks. These glasses project real-time visual cues and instructions, improving accuracy and efficiency in order fulfilment.

By integrating AR technology, the retailer enhances operational performance, reduces errors and speeds up warehouse processes, leading to more effective and streamlined order management.

5. Automated guided vehicles (AGVs)

Automated guided vehicles (AGVs) are autonomous robots designed to transport materials within a warehouse or production facility.

IKEA’s distribution centres utilise AGVs to move goods between various locations. These vehicles automate material handling, minimising the need for manual labour and enhancing operational efficiency.

By integrating AGVs, IKEA streamlines warehouse operations, accelerates the movement of products and improves overall productivity, leading to more efficient and cost-effective distribution processes.

4. Cloud computing

Cloud computing involves using remote servers hosted on the internet to store, manage and process data, rather than relying on local servers.

UPS employs cloud computing for its UPS Orion routing software, which optimises delivery routes and enhances logistics operations.

By leveraging cloud-based systems, UPS gains access to real-time data and advanced analytics, enabling more informed decision-making and improving the efficiency of their delivery and supply chain processes.

3. Automation and robotics

Automation and robotics involve using technology to perform tasks typically carried out by humans, improving efficiency and precision.

Ocado, the UK-based online grocery retailer, employs a sophisticated automated warehouse system featuring robots for picking and packing groceries. Its facility uses a grid system where robots navigate high-density storage to retrieve items efficiently.

This advanced set-up reduces manual labour and speeds up the order fulfilment process, allowing Ocado to handle large volumes of orders with high accuracy and minimal human intervention, thereby enhancing overall operational efficiency.

2. Digital twins

Digital twins are virtual replicas of physical systems, created using real-time data and simulations to model and analyse their performance.

Siemens applies digital twin technology in its logistics operations by developing virtual models of its warehouses. This technology allows Siemens to simulate and optimise warehouse layouts, processes and workflows before actual implementation.

By using digital twins, Siemens can identify potential issues, refine operational strategies and enhance efficiency, ensuring that physical changes are well-informed and effective in improving warehouse performance.

1. Artificial intelligence (AI) and machine learning (ML)

Artificial intelligence (AI) involves creating systems capable of performing tasks that typically require human intelligence, while machine learning (ML) is a subset of AI that enables systems to learn and improve from experience without explicit programming.

Walmart employs AI and machine learning, including generative AI (Gen AI), to enhance demand forecasting and inventory management in its supply chain.

By analysing vast amounts of purchasing data, these technologies predict future demand and optimise stock levels.

This approach reduces overstock and stockouts, improves efficiency and ensures better alignment of inventory with actual consumer needs, thereby refining overall supply chain performance.

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