Subscribe to our free, weekly email newsletter!



Building the Business Case for Automation: How to Evaluate Automation Investments

October 10, 2012

Benefits beyond pure dollars and cents are needed to drive the investment request across the finish line. Gaining authorization to invest in distribution center improvements, including automation, is a challenging endeavor in most organizations.

Overall economic conditions, along with individual business concerns such as availability of capital, competing capital projects and myriad obstacles potentially stand in the way. Given many immediate obstacles to obtaining investment approval, the development of a sound, thorough business case is essential for the distribution operations management team who wants to move his project forward successfully.

Reasons commonly cited for rejecting or delaying investments to substantially improve DC operations include:

  • Prioritization of capital toward top line growth, e.g., manufacturing capacity expansion, new product development, sales and marketing initiatives, etc.

  • Concern about temporary decline in sales or reduction in sales growth due to competitive pressures and/or economic conditions

  • Limited availability of capital due to recent business conditions

  • Unwillingness to put capital at risk due to an unfavorable regulatory climate

image

 

Subscribe to Modern Materials Handling magazine

Subscribe today. It's FREE!
Find out what the world’s most innovative companies are doing to improve productivity in their plants and distribution centers.
Start your FREE subscription today!

Recent Entries

Including a supplier annex, the new facility will localize the manufacturing of three-wheel electric models currently produced in Europe.

Until Aug. 8, 2015, companies can make a one-time claim for a 50-cent per gallon tax credit for every gallon of propane used in 2014.

Company donates batteries to support science, technology, engineering and math education.

Download this special report to read three stories that neatly define the challenges now facing warehouse and DC professionals and offer insight and tips that will help organizations rise up to meet the ever-increasing demands of omni-channel fulfillment.



© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA