Specialists in logistics and supply chain management face multiple sets of contradictory requirements: Reduce the space they use, but increase the volume of goods they distribute; decrease latency while lowering transport and handling costs; and, most conspicuously, cut labor costs but maintain or increase service levels.

Unlike corporate functions such as manufacturing, distribution cannot be entirely outsourced to countries that have low labor and real estate costs. Some hubs and packaging centers can be located in lowcost areas, but distribution centers (DCs) need to be situated in or near the areas they serve. Labor costs are a reflection of the labor market in those specific locations.

What’s a DC manager to do? Automation is both the key and the opportunity for companies that can deliver solutions to increase productivity and reduce costs while allowing for maximum system flexibility.

Of the range of technologies required to achieve total automation, this article focuses on two approaches to robotic automation that could have the greatest impact on warehouse management and supply chain efficiency: mobile robotic warehouse systems and automated guided vehicles (AGVs).