Warehouse technology is used in the logistics industry for operations automation, productivity enhancement, and efficiency maximization. At the same time, technology in warehousing aims to improve the processes of inventory control, order fulfillment, and the internal movement of goods in one warehouse or between warehouses.
The market of warehouse automation solutions is predicted to reach $38.23 billion in value by 2027.
This can be explained by the continued growth of eCommerce and the desire businesses have to save money. Statistics say that a typical warehouse with 100 employees costs more than $3.7 million in labor expenses annually. The implementation of technology in warehouses can help address this and many other challenges.
We’ve created a comprehensive article explaining how to choose warehouse technologies and how to implement them in business operations.
A few things you’ll learn about are:
- Key trends in warehouse technology
- Problems & how you can solve them with smart warehousing
- Types of automated warehousing systems
- Things to consider when choosing a warehouse technology
- 3 Steps to incorporate technology in warehousing
Read on to learn about technology in warehousing and how to choose a solution to streamline operations.
Warehouse Technology: Overview, Trends, & Statistics
Warehouse automation is an integral part of supply chain optimization. Warehouse technologies reduce time, errors, and the effort generated by manual and repetitive tasks.
Despite this, consider that more than 80% of the warehouses have no automation.
Only 15% of warehouses are mechanized, and only 5% use sophisticated automation warehouse technologies and equipment. As a result, companies are wasting a lot of money.
The situation is slowly improving and in 2026 the warehouse automation market will grow to $31.03 billion at a CAGR of 15.45%.
Because of the benefits promised, more and more companies are starting to implement technology in warehousing. Some businesses, like Amazon, set an example by building fully automated warehouses.
Problems You Can Solve by Using Warehouse Technologies
Warehouse operations are repetitive and error-prone. Warehouse technology can help companies organize efficient and accurate operations by automating all the processes, simplifying them, and taking repetitive tasks out of human hands.
Many companies use software development services to bring technology into their warehouse operations.
Let’s take a closer look at the role of technology in warehousing:
- Automates control over logistics operations
- Coordinates multiple logistics processes and programs
- Organizes employees and vendors by syncing the tasks of operators and machines
- Provides real-time stock control
- Maximizes efficiency in logistics operations
- Guarantees greater ROI
Need help with streamlining warehouse operations?
Get in touch with our team for a detailed consultation and implementation of your project. We can create highly customized automated warehouse solutions of any complexity based on your business needs.
Modern Warehousing: Top 10 Technologies to Utilize
A lot of technologies are finding their way into modern warehousing.
Depending on your business needs, you can automate data processing, implement robotics instead of manual work, or adopt cloud technologies.
Let’s look at some of the most popular technologies in warehousing.
1. Warehouse Management Systems
A warehouse management system consolidates warehouse data into a single platform that provides a complete overview of all your processes.
Every member of your supply chain has access to that platform and can create reports in real time, gain insight into business operations, and efficiently plan supply chain replenishment and management.
The use of technology in warehousing should align with your business needs and automate the critical business processes.
Such a solution should provide the following benefits:
- An overview of the whole supply chain
- Accurate demand forecasting
- Efficient labor allocation and reduced labor costs
- Better inventory accuracy
- Efficient warehouse processes
- Better warehouse security
- Reduced level of warehouse injuries
- Better relationships with suppliers
- Maximized space utilization
- Improved profitability
Before choosing a system, answer the following questions to avoid costly mistakes and improve ROI:
- Do you have an existing WMS? What are its benefits and downsides?
- What processes do you want to improve with a WMS?
- Do you have any specific business needs and requirements?
- What needs and requirements will your business have in the future?
- How much are you ready to invest?
- What other solutions do you need to integrate with your WMS?
There are numerous solutions for warehouse management, including TECSYS Warehouse Management, vTradEX Warehouse Management System, Microlistics WMS, and many others.
2. Automated Picking Tools
Automated warehouse picking uses robotic and semi-robotic technologies to enhance the work done by human pickers.
These solutions can be quickly integrated into existing warehousing processes and streamline the process of product picking. These systems can be used across industries such as retail, manufacturing, transportation, medical equipment, food and beverage, and more.
Picking technology in warehousing provides several benefits:
- Supports accurate picking and packing
- Reduces walking time and shorten picking routes
- Improves labor allocation
- Reduces human error
- Provides near-perfect picking rates
The warehouse management system automatically calculates the best locations to store products, picks the best paths for stock, and streamlines picking processes together with automated picking tools.
A great real-life example of warehouse picking tools is Cardinal by Amazon. This robotic workcell picks packages weighing up to 50 lb from piles, reads the labels on packages, and then places them in a GoCart for packages to continue their journey through the warehouse.
The solution reduces the heavy manual work, such as lifting, that Amazon employees need to do every day.
3. Automated Guided Vehicles (AGVs)
Automated guided vehicles follow digital paths through warehouses to load and unload pallets, boxes, and other containers with products.
AGVs navigate the warehouse thanks to radio waves, vision cameras, magnets, wires, floor stickers, and lasers. AVG operators can direct vehicles to pick and drop locations precisely thanks to GPS. They can also work fully independently from human operators, providing 24/7 operations.
The adoption of automated guided vehicles doesn't require warehouses to be rebuilt. You can integrate them into your system seamlessly and expand the fleet to meet growing business needs.
There are a few types of AVGs:
- Unit load AGV – this is a type of compact vehicle for transporting a single (or multiple) unit load for long distances. AVGs of this type can’t pick up loads and work in sync with other equipment that can pick and load goods.
- Forklift AGV – this is a pallet truck that picks up floor-level pallets and stacks them at various heights.
- Towing AGV – this tugger vehicle is like a train; it drags one or more non-motorised carriers loaded with goods to deliver them across warehouses.
The choice of automated guided vehicles depends on what tasks you need done. To make the right choice, keep the following points in mind:
- Weight of the loads
- Height where loads are stored
- Types of tasks to be automated
- How the AGV will move around the warehouse (e.g., rail, wire-guided, magnetic type, laser-based navigation)
- Working environment (e.g., extreme hot or cold conditions)
4. Robotics & Automation
Robotics and automation are interconnected solutions that streamline warehouse operations.
Robotics deals with designing, constructing, and operating robotic solutions to perform manual warehouse tasks. Automation deals with operations that can be performed autonomously with minimal or no human involvement.
There are a lot of repetitive, error-prone, and process-oriented processes that can be performed by robots automatically. Robotic warehouse systems and automation improve operations, reduce the physical strain on human workers, provide faster order fulfillment, and lower overtime.
Here are a few benefits that the implementation of robotics and automation can bring:
- More consistent, efficient, and accurate streamlined warehouse operations
- Lower physical strain on workers
- Improved morale and motivation of employees
- Faster order fulfillment time
- Lower overtime costs
Walmart partnered with Symbotic to introduce robotics to their distribution centers back in 2017. Today, the company uses robots across 42 locations. Mobile robots by Symbiotic cam move stock, robotic arms can pack and unpack items, and vision-enabled technology streamlines the process of order fulfillment. The system can process 1,700 cases per hour to organize products into different storage structures.
Before you start with the development of such a solution, first understand the following points:
- Processes you want to automate with robotics
- Average weight and size of your products
- Level of human involvement in the processes
- Conditions where robots will work
5. Cloud Technology in Warehousing
Cloud technology is a must-have in modern warehouses. Instead of putting physical servers in your warehouse, you can find a suitable provider and store all business data in the cloud. You can store anything there – from inventory records to sales numbers and analytical data.
Cloud technology can be integrated into existing warehouse technology and customized based on business requirements. Cloud technologies improve data sharing between departments and provide insight into all the processes within the company.
6. Business Intelligence & Predictive Analytics
Business Intelligence provides companies with meaningful insight from the data generated. BI tools access the company’s data, analyze it, and present the information in reports, dashboards, charts, graphs, and summaries.
The use of business intelligence solutions brings several benefits:
- Marketing team can track campaign metrics and customer behavior in real-time
- Finance department can see what affects profit and loss
- Sales team can use BI to track KPIs
- Operation department can optimize business operations
7. IoT Technology in Warehouses
The Internet of Things (IoT) connects devices, such as sensors, barcode scanners, mobile phones, and wearable gadgets into a network of equipment.
The system gathers and exchanges information between physical devices connected to the internet and the internal network helping to optimize inventory control, labor planning, and customer experience.
The IoT can help companies reduce risks and avoid accidents that can lead to losses in the supply chain by detecting issues early. For example, sensors can monitor temperature, moisture, and other conditions in the warehouse in order to provide the best conditions for product storage.
Another example is the collection of information from vehicles, shipping conveyances, and products in order to reduce spoilage, theft, counterfeiting, etc.
Verizon Connect offers advanced GPS fleet tracking software that allows users to monitor and manage a mobile workforce. The solution helps uncover hidden costs and reveal the potential for higher productivity and efficiency.
8. Blockchain Technology for Warehousing
Blockchain is a distributed ledger technology that records and connects blocks of transaction data. Without affecting all other blocks, there is no way to change a single block’s information. As a result, the stored data is protected from unverified changes and fraudulent actions and is not susceptible to tampering. However, the data is still accessible to anyone within the blockchain.
Blockchain in warehouses can change key operations – from inventory management to transportation tracking. Thanks to data transparency, manufacturers can manage product origins, track products back to their manufacturers, and ensure that they are using authentic products.
Another use case is inventory management. Manufacturers can see consumer-level demand in real-time. The data they get helps them forecast demand more accurately and plan product manufacturing or replenishment more efficiently to avoid spoilage. The technology optimizes business profitability and reduces the risk of lost sales.
IBM Blockchain is a great example of this technology being used in warehousing. Thanks to the use of a blockchain, partners within a supply chain can share trusted data from the allowed blockchain solutions.
9. AI Technology in Warehousing
Artificial Intelligence (AI) technology in warehousing revolutionizes the old approaches. This technology turns warehouses into smart ecosystems with advanced technologies that automate operations and ensure efficient data-driven processes.
Artificial Intelligence works with other technologies, such as machine learning, neural networking, deep learning, computer vision, and speech and visual recognition.
Thanks to AI, machines can perform human-like tasks such as decision-making, speed recognition, spatial awareness, and visual perception. AI technologies in warehousing process massive amounts of data using machine learning algorithms and statistical models for data analysis and prediction building.
You can use AI to automate warehouse operations such as product replenishments based on demand predictions. As well, you can use AI-powered chatbots to address customer inquiries with little to no human involvement. As a result, you can improve business efficiency, reduce costs, and streamline operations.
10. Mobile & Wearable Technologies
Mobile and wearable technologies are small devices users wear or carry around. They allow employees to view the necessary information while moving through the warehouse.
Thanks to the use of wearables, warehouse operations have become more efficient. Employees don’t need to walk to the workstation to view information; instead, they can make informed business decisions more quickly.
The use of wearable technology in warehousing is extensive. Smartwatches can be used to improve the efficiency of employees. Voice-controlled headsets can provide real-time inventory updates. Employees can also use voice-activated picking solutions. Smart glasses allow employees to view information hands-free while working on other tasks.
Zebra WS50 is an excellent example of wearable devices and their use in warehouses. The device is the world’s smallest all-in-one Android enterprise-class wearable mobile computer and an industrial barcode scanner. Zebra is light-weight and can be worn ring-style on two fingers, on the back of the hand, or on the wrist. The solution improves product picking and order fulfillment.
Ready to innovate your warehouse and streamline operations?
Get in touch with MLSDev for a discussion of your operations and requirements. We’ll help you decide what solution you need to improve business operations.
Things to Consider Before Using Warehouse Technologies
So, you’ve decided to adopt warehouse technology in your business operations.
Where should you start?
There are a lot of things to consider before kicking off the implementation process. We’ve analyzed all the points you need to consider before jumping in head-first.
Ready-Made Warehouse Technologies
These warehouse technologies provide everything you need right out of the box while ensuring a fast and easy setup process. Typically, they are great for small businesses with requirements that fit the capabilities of off-the-shelf solutions.
However, ready-made doesn’t always mean cheaper. Implementation costs may not be that low, going as high as half a million dollars or even higher. Such solutions for modern warehousing come packed with a lot of features; whether you need all of them or just a few, you’ll be charged for all the features.
What is Customized Technology in Warehousing?
Customized solutions are great if you have intricate business needs that ready-made technology can’t meet. These solutions are better suited for big businesses with extensive warehouses across different locations.
Developing a custom warehouse solution is a long process, but one that ultimately pays off. You can create a solution that will have only the features you need. You can customize the functionality set, support the required backend architecture, and scale quickly when business needs grow. In the end, customized solutions win because you have technology designed specifically for your business and you don’t need to pay for unnecessary features.
Ready-Made vs. Custom Solutions in Modern Warehousing
Between ready-made and custom solutions, which should you choose?
- Features
Ready-made solutions provide a pack of features. Your business might need only some not others; however, the provider will charge you for the entire package of functionality.
With custom solutions, you can invest in the development of only those features that you need. In the long run, building a custom solution might be more cost effective than using one that is ready-made. For example, you might want to add voice-activated technology, a system to manage regular qualification training for employees, or a technology to track the productivity level of employees in order to reduce burn-out.
- Integration capabilities
When adopting a warehouse technology, you will probably need to combine it with other solutions that your business uses. Here are a few solutions you might want to integrate your warehouse technology with:
1. Customer Relationship Management (CRM) is a system for managing all relationships and interactions between your company and customers or potential customers. Streamlining business operations, growing your business, and improving profitability are the main goals of CRM integration.
The list of possible integrations includes Salesforce, Microsoft Dynamics 365 Business Central, NetSuite, and so on.
2. Enterprise Resource Planning (ERP) is a system that organizes day-to-day operations such as accounting, project management, risk management, compliance, procurement, and supply chain operations. ERP systems collect and store data from the whole organization, providing data integrity and the ability for the different departments of a company to work with data.
The most popular ERPs are Oracle ERP, NetSuite ERP, SAP ERP, etc.
3. Product Information Management is a system for product information management. This system allows you to store technical data, product specifications, product descriptions and stories, relevant images, videos, manuals, and other information required to market and sell products.
Examples include Akeneo, PIMWorks, Syndigo, etc.
You may also need to integrate your warehouse technology with other solutions such as shipping systems, payment gateways, transport management systems, and so on based on your specific business needs
With ready-to-use solutions, you have a limited number of possible integrations. There is no guarantee that your favorite CRM will integrate seamlessly with a warehouse solution to meet your business needs. Thus, you’ll need to make a compromise.
With custom solutions, you can incorporate your warehouse software with any other enterprise systems. You don’t need to wait for a provider to add the support.
- Customizations
Out-of-the-box software offers limited customization capabilities. If you decide to build your own warehouse technology, its functionality will be easily extended and customized to changing business requirements and goals.
MLSDev, a software development agency, can help you build custom warehouse technology based on your business needs. We use a microservices architecture to make solutions easy to customize, scale, and support. When your business continues to grow, you’ll be able to extend the functionality, add new integrations, or customize the existing features.
3-Step Process to Incorporate Technology in Warehousing
Choosing warehouse technologies requires businesses to analyze their processes and objectives thoroughly. The solution you select or build needs to have the functionality that will streamline operations and make them more efficient.
Before incorporating technology in warehousing, let’s start with a few things to consider.
1. Define Business & Technical Requirements
A warehouse system should meet your specific business needs and automate warehouse operations. Before choosing or building a solution, you need to conduct a business analysis to identify your needs. You can do this yourself or hire a company that provides business analysis services.
The analysis results will give you an understanding of your business' struggles, what processes can be automated, and how you can improve efficiency. After you know the answers to all these questions, you’ll need to work on technical requirements. For example, if you want to improve picking productivity, you could adopt robotized solutions. Or, you might want to improve inventory management by implementing AI-powered solutions.
Thanks to the implementation of technology in warehouses, the final list of requirements will depend on what you want to achieve.
2. Select a Suitable IT Vendor
When you understand what solution you’re going to build, you need to choose a software development partner to help you build said solution. Thousands of companies provide software development services, IT staff augmentation, and dedicated development teams.
You need to take into account a few factors in order to make the right choice:
- Portfolio of successful projects
- Technologies the company uses
- Positive client reviews
- Similar projects in the portfolio
- Location and time difference
You can start your search with platforms like Clutch, ITFirms, and Software World. These online directories provide everything you need to make a choice – from portfolios to customer reviews and ratings.
3. Set Your Budget & Create Version 1.0
After you’ve found a vendor and have decided on the scope of work, you’ll be able to plan the software development budget. This will help you keep track of your project and all the associated expenses.
Usually, a software vendor provides you with a project estimate and you know the final price before you commit to that IT provider. What sets average companies apart from the best ones is the ability to estimate projects as close to the real numbers as possible. While some fluctuations from original estimates are possible, they shouldn’t be more than twenty percent of the whole project.
Final Takeaways on Implementing Technology in Warehouses
That’s it for our guide on implementing technology in warehousing. We hope you’ve found some information that will help you make the right choice and that you now know where to start.
Let’s briefly summarize the key points:
- Warehouse technologies automate tasks and reduce the time, errors, and effort needed for manual and repetitive tasks
- You can use numerous technologies in a warehouse such as Artificial Intelligence, Machine Learning, blockchain, robotics, wearables, automated picking tools, automated vehicles, and other smart devices
- Understand your business needs in order to choose the right solution. Sometimes, a ready-made warehouse solution will do the job, while in other cases, you’ll need to invest in custom-made development
- After you know your requirements, find the right tech partner to build the custom-made solution for your business
Want to hire a team to work on your warehouse technology and learn more about MLSDev and how we can help? Drop us a line and we’ll be glad to discuss your project.
Frequently asked questions
How much does it cost to integrate technology in warehousing?
The cost to integrate warehouse technologies can vary enormously – from $50,000 per platform (Android, iOS, or Web) for the simplest inventory management solution, to millions of dollars to convert to a fully automated warehouse. In general, the average price to create software for warehouses starts around $100,000+. This cost may rise up depending on the complexity of features, integration, design, selected IT vendor, etc. Get in touch with a development company to estimate your project based on the specific needs of your business.
How is information technology used in warehouses?
Technologies in warehousing are used for different purposes. You can automate tasks and reduce manual work and the associated risks and errors. Automated inventory management systems can decrease the risk of product spoilage and reduce theft. GPS-enabled solutions allow shipment tracking in real-time for end-to-end supply visibility.
How to select a capable IT vendor for integrating technology in warehousing
First of all, you need to understand your business and technical requirements. Start your vendor search on platforms such as Clutch, ITFirms, and Software World. During the research stage, pay attention to vendors’ portfolios of successful projects, the availability of similar projects, and positive client reviews. During the ongoing interview, communicate your requirements clearly and evaluate how the company approaches every project, how they mitigate risks, and what they offer in terms of development costs.
Why is MLSDev the best company to develop warehouse technology?
MLSDev is a software development outsourcing company that’s worked in the market for more than ten years. The company works with SMBs, startups, and big brands like McDonald’s, ESPN, GoPuff, etc. We provide a whole range of development services – iOS and Android development, software development from scratch, IT staff augmentation, UX/UI design, business analysis, DevOps, software testing, and QA. We can help you create an MVP within three months or create a full product with complex requirements.