Smart Warehouse Guide with Key Benefits, Ideas & Technology

13 Apr.,2023


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Technology is getting smarter daily, so we can do everything faster and more efficiently with minimal hassle. This is why the idea of Smart Warehousing isn't some futuristic science fiction concept but a rapidly unfolding necessity.

It essentially refers to incorporating Artificial Intelligence, Robots, and the Internet of Things (IoT) to automate and digitize various fulfillment activities to make the warehouses fast and efficient. These solutions work with human employees to reduce errors, save time, and improve productivity and warehouse efficiency.

Efficient warehouse monitoring, reduction in human errors, lower returns, better visibility of assets, improved customer experience, and faster shipping are some of the main benefits of a smart warehouse.

On-floor associates can be freed up to focus on more strategic and value-driven activities or guide the machines while they execute a specific task. To know more, read on.

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What is a Smart Warehouse?

A smart warehouse is a facility that uses automated systems for the storage and movement of inventory.

These warehouses run more effectively than conventional warehouses because they are equipped with sensors and other digital technologies.

For instance, the software can be used to improve the structure of the warehouse and sensors can be used to track the location of inventory as it moves through the warehouse.

This lessens the time staff spend walking throughout the warehouse and lowers the chance of mistakes.

Smart warehouses are becoming increasingly popular as companies explore ways to cut costs and boost productivity. Smart warehousing operations include frequent usage of robots and automated conveyor belts that can move inventory from one place to another.

This further lessens the requirement for human work and enables the warehouse to operate twenty-four hours a day.

As the rivalry for eCommerce clients intensifies, more businesses are looking to embrace smart warehouse technologies to stay ahead of the curve.

Top 6 Smart Warehouse Benefits

1. Better Warehouse Optimization

Incorporating smart warehouse operations can improve the efficiency of the warehouse and optimize the workflow of various fulfillment operations. Advanced analytics driven by machine learning algorithms help warehouse operators to manage inventory flow, maximize storage, and reduce process chokepoints.

The data-driven approach helps keep a tab on the key metrics and enables the warehouse to have a streamlined operation and, in turn, offer better customer service.

Such advanced technologies can also detect problems and potential risks early in the supply chain. Having data around inventory and supplier risks empowers warehouse managers to be more proactive than reactive.

2. Lower Operational Costs

One of the most significant benefits of a smart warehouse is that only some tasks require constant human intervention. Incorporating robots, drones, and automated vehicles can make the execution partially or entirely autonomous.

3. Faster Picking and Shipping

A Smart warehouse also translates into faster order processing times. In a non-automated warehouse, associates spend much of their day moving around and looking for different products.

This is not only time-consuming but also prone to errors. Smart picking devices such as pick-to-light, wearable scanners, smart glasses, and picking robots can drastically reduce the time needed to search, verify, and choose an item from the storage bin.

Similarly, adding parcel sorters and conveyors to the shipping workflow can eliminate misplacement and incorrect labeling of packages. Thus, faster picking and error-free shipping can shorten the order lead times.

Shorter fulfillment cycles offer the competitive edge you need in a world that is gradually getting used to same-day shipping.

4. Greater Accuracy in Warehouse Operations

A typical warehouse operation consists of several processes and steps susceptible to errors. These errors can set up the entire business for a substantial operational loss if not identified and resolved on time.

One of the top advantages of smart warehousing operations is higher accuracy at every step with automated order fulfillment cycle. It also helps reduce the number of items lost, damaged, or expiring due to improper inventory management.

5. Better Customer Service

Every product in a warehouse finally ends up with the consumer. It is essential to focus on customer service, experience, and satisfaction.

With smart warehousing, companies can improve how they interact with their customers, fulfill their changing demands, provide support, and enhance the overall experience.

With faster shipping, reduced costs, and prompter responses, businesses can build a satisfied customer base. This will also result in a better customer experience and customer satisfaction

6. Better Tracking of Assets and Inventory

Efficient inventory tracking is one of the biggest concerns for most warehouses. Knowing where a specific product is in the supply chain can help you gain insights about the orders processed, improve supply chain planning, and estimate when the next batch of products might be needed to prevent a stock-out situation.

So, RFID tags, barcodes, integrated sensors, and other latest technologies provide unparalleled visibility of product movement and inventory status in a smart warehouse.

Read Also: Digital Transformation of the Warehouse

How to Implement Smart Warehousing

While the top benefits of smart warehousing are gradually becoming public knowledge, some organizations still need to be cautious about investing in the digital transformation of their warehouses.

The reluctance to adopt usually stems from the cost-prohibitive and time-consuming nature of the incumbent automation infrastructure.

However, smart warehousing entails a broad spectrum, from enabling paper-free operations to installing autonomous robots. Following are some of the components of a smart warehouse.

1. Autonomous Mobile Robots

These advanced machines can execute several tasks ranging from automated warehouse picking and storage to packaging, inventory distribution, and more.

They are intended to work in tandem with the floor associates to ensure a seamless, optimal, and error-free goods movement flow.

2. Internet of Things (IoT) adoption

IoT is getting increasingly popular in the smart warehouse space. Smart IoT devices range from picking devices, sensors, and robots to ASRS systems communicating operational data in real time to the central warehouse system.

Such granular real-time data becomes a valuable input source for machine learning algorithms to learn and optimize recommendations.

3. Artificial Intelligence

Analyzing a large amount of data accumulated during smart warehouse operations can be vital to optimizing various processes.

The AI-driven approach can assist with predicting Inventory demands, optimizing picker routes, enabling dynamic task allocation, and handshakes on the floor.

Using Artificial Intelligence will reduce labor costs for the entire warehouse compared to the traditional warehouse.

4. Warehouse Operating Systems

Smart warehousing requires much more than a run-of-the-mill Warehouse Management System (WMS). It needs modern warehouse software that can act as the central operating system or control tower to orchestrate the flow in real-time.

Besides, such a system can be the glue between ERP, WMS, and Shipping software on one end and all the sensors and automation hardware on the other.

Most importantly, the central operating system should have the intellectual depth to leverage advanced analytics to make predictive recommendations.

5. Automated Guided Vehicles (AGV)

AGVs can maximize warehouse space while minimizing the need for new fulfillment and distribution facilities to be built.

Forklifts and pallet carts are examples of AGVs that are self-guided and follow digital pathways within the facility as they load and unload pallets, boxes, and other containers.

AGVs handle hazardous circumstances more efficiently while reducing material damage and improving inventory accuracy.

6. Automated Picking Tools

Automated picking components in smart warehouse technology can help the warehouse achieve optimum picking rates. Within this grouping, there are numerous different tools (like voice automated picking and pick-to-light). the WMS should be designed to accommodate these technologies for efficient smart warehouse operations.

It enhances picking by accelerating it, optimizing labor allocation, and lowering human error.


Building a smart warehouse is essential to stay competitive with the rapidly evolving consumer expectation and the disruptions caused by the current pandemic.

Forward-thinking businesses are catching up with the idea of smart warehousing, slowly but surely.

Several enterprises are substituting spreadsheets, legacy systems, and other rudimentary processes with some of the mentioned smart warehousing components.

Eager to know how you can make your warehouse smarter? Get in touch with us today!

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