GIEICOM Sep 23, 2020 12:00:00 PM 7 min read

How to calculate the ROI of the automation of your Distribution Center

 

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There is no doubt that the automation of Distribution Centers is a key step to build intelligent supply chains, capable of responding to the changing demands of the market.

However, ensuring that a CEDIS automation project will generate the return on investment that your company is looking for can be difficult to determine. That is why today we provide you with an orientation about the elements that you should consider in calculating the ROI of your automation project. Keep reading!



Although there are several steps that must be followed to calculate the return on investment of this type of projects, there are two fundamental factors to consider in this process:



  • Definition of the area to be optimized and complete analysis of alternatives

 

First things first. Depending on the area or process that you seek to optimize within your DC, the umbrella of automation solutions that you have for this will open.

 

In turn, each type of solution entails a series of alternatives that you must analyze in depth to determine which is the most viable for your organization and which one offers you greater tangible and intangible advantages according to the needs and objectives of your operation.

 

Some examples of the tangible benefits that a CEDIS automation solution can provide are those related to:

 

  • Productivity (man-hour)
  • Space reduction
  • Order Increase



On the other hand, intangible advantages have more to do with:

 

  • Increases in customer satisfaction
  • Quality on demand
  • Improvements in your market reputation



At this point it is important to remember that it is necessary to preponderate each of these advantages to obtain a much more accurate analysis.

 

Also, another important point to consider is the approach of the automation solution over time; that is, forecast the life cycle or capacity it will have, considering the operational growth projections of the Distribution Center.



  • Financing method

 

Once you have selected the CEDIS automation solution that best suits the needs of your company, it is especially important to analyze the financing method you will use to acquire the solution. Be it credit, investment, or any other financing mechanism, do not forget to consider capital inflation.



Evaluating both aspects when calculating the return on investment of your DC automation project will allow you to have a better sensitivity to select the best alternative for your company, prioritizing what is most important for your operation so that your ROI is maximized.



Are you looking for innovative technologies to automate your CEDIS? At G.I.Eicom we want to help you!



We have more than 35 years of experience in the design and implementation of intelligent intralogistics solutions that optimize the productivity and competitiveness of Distribution Centers.

 

Committed to maximizing your return on investment, we offer a comprehensive consulting service throughout the entire project, including the development of sophisticated simulations to avoid costly errors in the future, and thus guarantee high strategic value in your operation. Contact us!


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