Automation has become a significant part of distribution, manufacturing and warehouse operations, helping industrial facilities improve speed, safety, quality and productivity. As automation adoption continues to grow, so does the number of technology providers, integrators and engineers, making it increasingly difficult to identify the right partner.

The right automation partner can have a lasting impact on both project delivery and long-term operations. Many automation systems require modifications to the floor, structure, fire protection and electrical systems, making it critical to incorporate those requirements into the building program early to keep projects on schedule and within budget.

While we don’t always have a direct role in selecting your automation partner, we’re invested in helping make your project as efficient and successful as possible. That’s why we partnered with Keith Swiednicki International (KSi), a global supply chain technology consultant, to share practical guidance for evaluating solutions, selecting the right partner and planning for successful implementation.

1. Assess: Determine Which Technology Best Aligns with Your Business Needs

The first step is understanding which automation technology best fits your operation and delivers the most benefit. Rather than relying solely on vendors, conduct your own analysis. In KSI’s experience, suppliers and integrators consistently misinterpret the detailed data provided, and often fail to meet critical operational requirements, such as a 3-hour shipping window. This leads to inconsistent material handling solution sizing and pricing across the board, with ROM estimates frequently varying by 20% or more. In addition, some suppliers recommend the cheapest available vendor product simply to maximize their own markup. may want to suggest the benefits of engaging an unbiased, experienced third-party technology consultant, such as KSI services, with a proven track record of successful implementations.

Start by establishing a status quo benchmark of your current operations. This creates a baseline for comparing potential solutions and should include detailed metrics such as shipments, purchase receipts, inventory levels and productivity for direct labor (any warehouse employee who touches the product) and indirect labor (managers, supervisors, clerks, sanitation, maintenance etc).

From there, develop at least three layout options to evaluate, as no single solution is universally best. Assess each alternative based on key factors such as:

  • Storage and throughput capacity
  • Capital investment and ROI
  • Labor productivity
  • Projected lifetime of three, five or 10 years
  • Anticipated changes in the existing business model, including changes to inventory levels or new items

Once the alternatives have been evaluated, develop a final, refined solution with clear metrics to measure success, such as:

  • Reduced building footprint
  • Labor savings and lower turnover
  • Faster and more accurate orders
  • Lower cost-per-pick
  • Increased storage density
  • Improved safety and work environment
  • Other savings such as retail stocking and transportation

Finally, define the timeline, budget expectations and financial analysis for the system, including payback years, Net Present Value (NPV) and cost per case. These can be weighted alongside the less quantifiable metrics such as quality, labor availability, and runtime reliability.

2. Solicit: Develop a Request for Proposal (RFP) and Solicit Proposals From at Least Five Suppliers

Once the appropriate technology has been identified, develop a Request for Proposal (RFP) and solicit proposals from at least five suppliers. With approximately 150 potential vendors and integrators and numerous warehouse automation technologies available, consider engaging a third-party team to craft the RFP and level the bids.

The quality of information received from the vendors in the proposals will depend heavily on the depth of information provided to them. To prevent boilerplate bids, consider providing detailed business and operational data, including:

  • 52 weeks of raw line-item data from the internal assessment to avoid “best guess” solutions. Without this information, vendors may provide different-sized solutions
  • Operational data with specific store cut-off times and peak inventory periods
  • Product WHS and vendor TI/HIs and/or pallet plus load height and pallet positions of each to ensure proper storage space is included, which is a common error seen across proposal submissions
  • A specific SKU projection strategy, including tail inventory
  • Projections for demand changes, including volume and SKU growth; network changes, such as new customers or stores; and a 12-week demand profile, including items, lines, cases and value
  • Clearly request the automator identify non-conforming SKUs and allocate conventional storage space accordingly

Ensure bidders clearly state the desired end results, including solution design, cost, size and productivity rates. Require bidders to itemize costs for a true “apples-to-apples” comparison and request a full breakdown of operational costs, including maintenance, support, license fees and software upgrades.

Compare proposals against the manual baseline solution to validate the expected reduction in staffing. For vendors that do not follow this process, apply a 75% factor to their proposed rates for a more realistic estimate.

The evaluation should also consider how system complexity, including sensors and controls, impacts design, cost, downtime and throughput. Determine whether to lease, buy or develop the WES or whether a new WMS system is needed.

Finally, narrow the options to two or three companies and visit their live operational sites, not test labs or facilities in different industries, to see the equipment in action.

3. Implement: Select Your Partner and Finalize the Contract

The implementation phase is highly technical, complex and time-consuming, making the choice of partner paramount. The entire design and construction team depends on detailed information from the automation vendor, so schedules and goals must remain aligned.

The primary goal should be to find a reliable, experienced integration partner. Their expertise is essential for controlling the project timeline and budget. If a consultant was engaged during the assessment and solicitation process, retain them to help ensure alignment throughout implementation.

When a vendor commits to specific deliverables in the contract, it requires them to thoroughly review their design and costs to deliver on the promised benefits.

Avoid accepting the vendor’s boilerplate contract and nomenclature. Instead, specifically state and include key requirements in the final contract, including:

  • Detailed design parameters
  • Operational assumptions
  • Productivity expectations

The commitments made in the design and purchase of the equipment are less flexible than manual solutions and should be weighed carefully to ensure long-term operational success.