In a recent study, a whopping 77% of U.S. retailers expressed fears about rip-and-replace automation. They preferred using legacy tech systems instead.

The reason? Rip-and-replace automation methods required a complete overhaul of legacy systems and infrastructure. Retailers were clearly not ready for business disruptions and the high integration costs of rip-and-replace automation.

It’s the same with manufacturers who want to automate their warehouses. The thought of ripping off existing systems and replacing them with modern systems does not sit well with many. 

That’s why the once-coveted rip-and-replace method is slowly losing favor in warehouse automation.

However, not all hopes are lost. Manufacturers can still automate their warehouses without making extensive changes to the systems or infrastructure. It’s called the retrofit automation. 

Read ahead to learn more about retrofit automation and how it differs from the rip-and-replace automation. 

However, before that, let’s understand the differences between these two types of warehouse automation.

What Is Rip-and-Replace and Retrofit Warehouse Automation?

Rip-and-replace is a method of replacing old systems and equipment with new ones. This could mean completely changing the infrastructure and layout of the existing warehouse. 

Retrofit, on the other hand, focuses on updating or modernizing existing infrastructure without an overhaul. This involves integrating new systems and technologies with the existing ones without making any significant changes to the warehouse. 

Let’s explore how each of them fares based on certain parameters.

A Comparative Analysis Between Rip-and-Replace and Retrofit Automation

• Costs

There is a high upfront cost involved in rip-and-replace automation. Manufacturers have to discard all the existing systems and remodel the layout to install new systems. While the costs vary depending on warehouse size and automation systems, the average price could exceed millions of dollars.

Retrofit, on the contrary, is more cost-effective as manufacturers don’t have to build new warehouses from scratch. The changes are done incrementally. For example, it could be something as small as automating material handling systems or optimizing the existing spaces to add more Stock Keeping Units (SKUs). Such changes don’t require a complete overhaul and are thus more cost-effective. 

• Business disruption

Business disruptions could lead to significant losses for manufacturers. That’s why a rip-and-replace automation might not be a viable option for a thriving business. It could lead to unnecessary delays, unplanned downtimes, and revenue loss.

Retrofit minimizes the chances of disruptions as it is done in a phased manner. The entire warehouse is not shut down for an upgrade. Take the example of a modular rail system. Manufacturers don’t have to replace racks or do floor anchoring. The rail system can be directly mounted onto the existing racks. This enables the manufacturer to modernize the warehouse without worrying about halting operations. 

• Implementation time

Time is money in manufacturing. In a hyper-competitive manufacturing industry, manufacturers cannot wait for months or years for a warehouse to be rebuilt or automated. They need to become operational more quickly to meet customer demands. That’s why most manufacturers are shifting away from rip-and-replace warehouse automation. They will have to shut down operations and wait for a long time to complete the new construction. The implementation could take longer if the warehouse operations are large-scale and complex.

Retrofit automation typically takes under six weeks to deploy and is relatively easier to scale. Manufacturers have to integrate the new solution with existing racks, mezzanines, and high bays. There is no infrastructure customization or floor preparation required.

• Integrations

In the rip-and-replace method, manufacturers replace the entire legacy system with new ones. Integration with ERP and WMS happens from scratch. While this helps manufacturers modernize their warehouse operations, issues in data synchronization and system incompatibility could pose challenges.

Retrofit automation does not shake up a lot of things because it integrates with existing systems. However, there must be compatibility with existing systems to ensure smooth operations. The system should be able to integrate seamlessly with existing WMS and OMS platforms and run independently. 

• Associated risks 

Since manufacturers invest time and money in building new systems and infrastructure from scratch, the risk is high in rip-and-replace automation.

Comparatively, retrofit automation is less risky as it modifies the existing warehouses and systems.

• Use cases

Rip-and-replace automation is useful for completely transforming a warehouse. It is particularly beneficial when existing processes become fully redundant or when the manufacturer shifts their business model. For example, building an e-commerce fulfillment store might require a rip-and-replace approach.

Retrofit is beneficial when manufacturers want to optimize spaces for scalability or increase their throughput without building a new warehouse. For example, manufacturers can use high-speed robot shuttles to retrieve and deliver totes and cartons from any rack without changing the layout. 

How Carte+ Can Streamline Warehouse Automation

Clearly, retrofit automation is an obvious choice for manufacturers who want to make changes and go to market faster.

At Cartesian Kinetics, we understand the importance of fast and cost-effective warehouse automation. Hence, we have built Carte+ that offers the world’s first Omni Rack Robotics (ORR) systems. Carte+ can seamlessly integrate with the manufacturer’s existing warehouse infrastructure without making any extensive changes to the warehouse. It can work effortlessly with existing standard racks, mezzanines, and high bays without any custom infrastructure or floor preparations.

With Carte+, manufacturers can deploy warehouse automation within six weeks and boost throughput by up to 5X. Whether it’s real-time coordination and smart routing or multi-modal picking for B2C, B2B, stores, or e-commerce, Carte+ supports all operations.

To know more about how Carte+ can supercharge manufacturing without any major changes to systems and infrastructure, contact us. 

FAQs

Q: What are rip-and-replace and retrofit warehouse automation?

The rip-and-replace method entails removing all existing systems and infrastructure and replacing them with new ones. Retrofit warehouse automation involves upgrading the infrastructure and systems without tearing down or replacing them. 

Q: Why is rip-and-replace warehouse automation losing the race?

Warehouses that choose rip-and-replace automation spend a lot of money and time on automating the warehouse. There are also risks of business disruption during transition and a lack of scalability that make rip-and-replace automation ineffective.

Q: How can retrofit warehouse automation benefit manufacturers?

Retrofit warehouse automation does not necessitate a complete overhaul of systems and infrastructure. This helps manufacturers save costs, implement the changes faster, and eliminate downtime.