When implementing warehouse automation, it’s essential to consider both the costs and the benefits of your purchase. Calculating the return on investment (ROI) of warehouse automation allows you to analyze how well your automation serves your business goals and determine whether the benefits outweigh the costs.
ROI is an invaluable tool in determining whether specific upgrades have been or will be worth the cost. An accurate ROI calculation helps you make informed decisions about the equipment you use, the processes you have in place, and the ways you can improve warehouse productivity both now and in the future.
There is a simple equation for calculating the ROI of warehouse automation. Simply subtract the cost of your automated equipment from the profits or savings you gain from that automation. A higher resulting number indicates a greater ROI and a more successful investment overall.
Factor in All Costs
When calculating ROI, it’s important to consider all the costs of your investment. The upfront price of the equipment isn’t the only cost you face when you implement warehouse automation.
Think about operative costs, maintenance services, repair or replacement prices, and so on. It’s also important to consider potential upgrades the equipment will need down the line as technology changes and your company grows.
A comprehensive analysis of all the different costs of your investment will help you gain a more accurate understanding of your return on investment.
Short-term goals and needs influence many of the decisions you make for your facility, but you can’t lose sight of what lies ahead. ROI of warehouse automation is a long-term projection that factors in the needs of your facility over time.
For example, if you purchase a wrap-around case packer to improve your packaging workflow, will it be able to meet demands both now and during your busiest season? Will the case packer help improve turnover rate due to a safer workflow and fewer ergonomic injuries? How much will it cost you in maintenance, repairs, and upgrades over the next 10 years? Considerations like these help you look at the big picture so you can make smart decisions with the future of your business in mind.
Your automatic equipment manufacturer plays a huge role in creating a positive return on investment. When you need warehouse automation you can rely on to serve your facility well, turn to Robopac USA. Contact our team today to learn more about the automated solutions that can enhance your secondary packaging workflow.