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In the coming year, businesses plan on spending more for material handling equipment and supplies, but they are going to paying closer attention to where their money is being spent so they can make sure they are getting full value from every dollar.
That’s the feedback received from the Peerless Research Group’s (PRG) 2015 State of Warehouse/Distribution Center Equipment Survey, which was released earlier this month.
Warehouse and DC operators are more confident about future economic growth, but at the same time have been burned by the past so they want to take a more cautious approach to spending.
Norm Saenz, managing director of St. Onge Co. — a warehouse and DC consulting firm — said the survey’s results indicate that companies want to be smarter about the way they are spending their money. Many of the firm’s clients are seeking to invest in the right technology that will support a steady growth in business volumes, he said.
‘Survey Says …”
Among the surveys findings:
- About 60% of warehouse professionals surveyed said they plan to spend less than $250,000 on material handling equipment in the coming year. And 25% said they plan to spend $1 million or more. About 25% of all respondents said they plan to use at least one new supplier.
- About 35% of respondents said they are willing to move forward with investments right now, compared to only 27% last year and 19% in 2013. About 35% said they would take a “wait and see” approach to buying material handling equipment, compared to 43% last year and 51% in 2013.
- The average amount respondents said they planned to spend on material handling equipment this year was $345,550, the same amount as last year and the year before that.
- About 43% of the planned spending will go toward material handling equipment. Of that amount, most respondents said they planned to buy lift trucks and accessories (52%), followed by racks and shelving (46%); bar coding equipment (40%) totes, bins and containers (33%); and mobile and wireless solutions (31%).
- The most pressing issue among respondents was safety (89%), followed by training (65%), labor availability (57%), and ergonomics (52%).
- Among manufacturing operations, 57% of respondents said they planned to focus on lean manufacturing during the coming year. A total of 42% of people said they planned to focus on just-in-time production, and 29% said the planned to focus on just-in-sequence production.
- Among warehousing and distribution operations, the biggest concern in the coming year was labor productivity (59%), followed by keeping inventories lean (50%)
- About 50% of the industry leaders surveyed said they outsource the maintenance of their automated material handling systems, and only 12% said they always maintain it in-house. Another 35% said they use a combination of the two. Vendors and maintenance suppliers were mostly used for maintenance (49%), upkeep/upgrades (46%), consulting (43%), and data analysis (17%).
- About 10% of the warehouse and DC leaders surveyed said they use automated guidance vehicles (AGVs) in their facilities right now. These were used mostly for transportation (41%), but they also were used for storage (38%), bin picking (23%), truck loading (20%), uploading (14%) and order fulfillment (20%). About 18% use robotics for other functions such as palletizing, pick and place or part transfer, packing/packaging, depalletizing and unpacking.
The survey was based on 448 qualified respondents from manufacturing, warehousing, corporate and aligned logistics professionals.