5 Cost Factors For Automated Storage and Retrieval Systems (AS/RS)

Automated storage and retrieval systems (AS/RS) are a bucket of technologies that have tremendous potential to positively impact the bottom line of order fulfillment operations in a wide variety of industries. But despite the many advantages of AS/RS, it is important to note that embracing AS/RS can be a costly endeavor. Implementing AS/RS is a big investment, but one that offers tremendous ROI by increasing the efficiency of your order fulfillment operation.

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Because cost is such a major consideration for a major purchase such as this, it’s important for you to know some of the major factors that could potentially impact the final cost of your new storage and retrieval system.

The cost of AS/RS can vary widely from operation to operation and from industry to industry—the devil is in the details, after all. That being said, to help you determine where on the cost spectrum your new system is going to fall, here are five factors that can impact the cost of AS/RS:

• Available clear height in your facility
• Type of environment where it will be implemented
• The size (and quality) of the load to be handled
• The delivery and takeaway systems in place to feed the AS/RS system
• Your “type” of facility: Whether steel-frame or rack-supported

1. Available Clear Height

The available clear height in your facility has the potential to dramatically impact the cost of implementing AS/RS. This is primarily due to the fact that the higher you are able to build your system, the less expensive each additional vertical foot becomes. On a per-location basis, this means that shorter AS/RS systems will cost more than taller systems.

Why? Because the costliest component of any AS/RS is the retrieval/storage component—the moving parts. This means that adding more storage vertically is less expensive than adding additional aisles of AS/RS. The clearer the height your operation has for AS/RS, the better it will be for your budget.

It is also worth noting that vertical space is, for many operations, wasted space. Reclaiming some of this space and putting it to use through AS/RS allows your operation to become more productive and efficient while using less actual floor space—a win for operations!

2. Environment

The type of environment that your AS/RS will be expected to operate in can impact the final cost of the system—or even preclude it as an option for your operation. AS/RS operating in warehouses or distribution centers with a moderate, ambient temperature are typically on the lower end of the cost spectrum, while those operating in coolers or freezers are typically on the higher end of the cost spectrum.

This difference in cost is due to the material and installation costs associated with building an AS/RS that can withstand colder temperatures.

AS/RS technology may be suitable for many hazardous environments (dusty, chemical, explosive, etc.) however this will need to be evaluated on a case-by-case basis.

3. Size and Quality of Load

The size of the load that the automated storage and retrieval system is expected to handle can have a major impact on the cost of the system because the size of the load will determine what type of AS/RS you implement. Unit-Load (i.e., pallet, gaylord, drums, large totes, etc.) AS/RS typically being more expensive to implement than mini-load or shuttle system (i.e., cases, totes, etc.) AS/RS.

This difference in cost is due to the fact that Unit Load AS/RS handles much larger quantities of product and therefore more weight. The need to move heavier product necessitates more heavy-duty machinery and a larger system overall, which drives up cost.

Additionally, because of predictably poor-quality pallets, a Unit-Load AS/RS will often require the application of a captive “slave-board” for each pallet in the system. In other words, each pallet is automatically placed on a slave-board, which ensures a reliable handling surface irrespective of the quality of the actual pallet itself. The need for the boards and the board handling subsystem will add to the cost of implementing AS/RS.

Mini-Load or shuttle AS/RS, conversely, handles smaller quantities of product at a time—cases and totes—which allows for the use of lighter duty machinery that is typically less expensive to implement. Although seldom the case, the quality and actual size range of the cases/totes itself may require special handling techniques and could add to the system cost.

4. Delivery and Takeaway System

The method with which you plan for the product to be delivered to and taken away from the automated storage and retrieval system will have an impact on the overall cost of your project, though it will be an indirect cost.

Generally speaking, delivering product by hand truck or forklift will require little in terms of upfront investment, while implementing a conveyor, shuttle car, or AGV system will require more of an upfront investment to put in place.

5. Steel-framed vs. Rack-Supported Buildings

If you are considering implementing AS/RS as a part of a new warehouse or distribution center project, it is important to note that the type of building you already have or choose to construct can have a tremendous impact on the final cost of your system. For example, choosing to construct a rack-supported building (up to 120’ tall) as opposed to a more traditional and larger footprint steel-framed building (40’ tall) may offer significant capital savings.

This is because, from the perspective of storage, a rack-supported building offers much more total storage space per square foot compared to a steel-framed (i.e. lower height) building. A steel-framed building’s rack system layout is to some extent dictated by the many roof-support columns needed throughout the building (and the dead space these supports create). Alternatively, a rack-supported building paired with AS/RS can use more of the available footprint more efficiently by eliminating dead space via its integrated roof supports (which allows more freedom in the rack system design), thereby allowing for more storage in less physical space.

The Bottom Line and ROI

Budgeting for any large project is always easier when you know what factors may impact the final cost. When it comes to implementing AS/RS in your order fulfillment or distribution center, everything from the height of the system, to the environment it must operate in, to the size and type of the load, and more will have an impact on the final cost of your new system.

It is important to keep in mind, however, that these factors speak only to the required investment of upfront capital, and don’t take into account the potential for productivity improvements, inventory control/accuracy gains and other operational and maintenance savings that AS/RS technologies may bring to the table. Whether seeking to optimize an existing facility or designing a brand new one, AS/RS should be seen as just a single piece of the warehouse automation puzzle.