How to Develop Automated Warehouse Systems for Your Logistics Business?

Updated on May 2nd, 2024

How to Develop Automated Warehouse Systems for Your Logistics Business

With the advent of AI in logistics, the trend of automated warehouse systems gained huge momentum. Companies, whether big or small, are today investing actively in automated warehouse solutions that facilitate innovation, efficiency, and profitability for logistics companies. And why not?

Logistics warehouse automation is based on the core AI development services encompassing computer vision, robotics, and even NLP services to automate tedious and complex warehouse operations. Automated warehouse systems allow you to automate various tasks, including product categorization, site inspection, inventory audits, demand forecasting, and even accounting tasks. 

Besides that, you can even optimize your data entry and customer support operations with an automated warehouse management system! Due to such magnificent benefits, the market for automated warehousing solutions reached $19.5 billion in 2021, which is expected to surpass $37.6 billion by 2030!

So, why are you left behind when the world is adopting automated warehouse systems? Explore this guide to learn everything about logistics warehouse automation and the process of implementing automated warehousing solutions in your logistics company. 

  • Warehouse automation involves streamlining various facets of your business through next-gen technologies and smart algorithms.
  • Automated warehouse systems innovate your business operations and offer benefits like reduced operational costs, fewer risks, and better efficiency.
  • Many technologies are associated with warehouse automation, including AI, IoT, cloud computing, etc.
  • To implement automated warehouse systems in your business, you must choose a specific use case and partner with an experienced software engineering services company.
  • Make sure to choose a development partner having expertise in AI and other next-gen technologies and offers a wide array of software development services.

What is Automated Warehouse Management Systems?

Automated warehouse systems are smart solutions that streamline various aspects of your warehouse and facilitate logistics warehouse automation. Automated warehouse management systems follow process automation techniques that smartly automate your inventory management operations, product movements, categorization, and even load planning tasks while bringing efficiency into your daily work operations.

Logistics warehouse automation also streamlines customer support, asset tracking, and data entry tasks. In short, it minimizes labor-intensive tasks while taking your logistics business a step closer to Industry 5.0! For instance, automated warehouse management systems offer NLP-driven chatbots that understand the true intent of your customer’s messages and reply to them most effectively.

Similarly, the computation vision and robotics services further streamline the risky and mundane logistics operations such as product loading/unloading, categorization, site inspection, product audit, etc. 

How Does Logistics Warehouse Automation Work?

After knowing the underlying term, you might be wondering how does it all happen? In other words, how do automated warehouse systems operate? Well, here’s your answer!

An automated warehouse management system works with multiple AI development services. For instance, it uses robotics to automate warehouse management operations, including product loading, inventory audits, stock updates, etc. 

Besides that, automated warehouse systems also work with the computational vision to get the exact customer demands and create a sync between store and warehouse. It can also use a chatbot to give real-time business info regarding vehicles and assets to the admin and resolve your customer queries. 

Why Is Logistics Warehouse Automation Beneficial?

Automated warehouse systems have become a core necessity for the logistics company to survive in the competitive market. Right from a reduction in operational cost to efficient operations, lesser risks, and a 60% increase in productivity, warehouse automation software can offer many things to your logistics company.

Are you still not convinced? Here are a few exemplary benefits of warehouse automation solutions that you can enjoy for your organization!

Innovative Approach

We all know that automated warehouse systems utilize multiple next-gen technologies, including AI, ML, IoT, etc. Hence, you could easily innovate new business ways with all those cutting-edge technologies. 

For instance, autonomous robots and vehicles can manage your product loading/unloading tasks. Moreover, your site inspection could be carried out remotely using IoT sensors and drones. Many other complex operations could be innovated via automated logistics software development.

Better Business Insights

Another excellent advantage of using automated warehouse systems is better business insights. We all know that data is a critical asset that can help you succeed in today’s competitive market. However, it is difficult for legacy warehouse systems to extract data from multiple sources, store it, and analyze it to obtain business insights.

But that’s not the case with automated warehouse systems. Warehouse automation software uses data analytics and AI technology to extract data from various touchpoints and sensors. All that data is safely stored on a cloud platform. The AI tool then uses that data to generate meaningful business insights that can yield better profits and new business opportunities!

More Productivity and Efficiency

There are several cases wherein a small human error could lead to huge monetary losses. Not to mention, the risks involved in certain warehouse operations can also lead to loss of resources. However, all those concerts are easily resolved using warehouse automation software.

An automated warehouse management system utilizes your data to understand your business operations. It then automates and simplifies all the complex processes, eliminating human dependency and bringing efficiency and productivity to your logistics business. 

Reduced Operational Cost

That’s one of the core benefits of implementing automated warehouse systems. Increased operational costs are one of the primary concerns of all businesses, and logistics is no exception! Manual warehouse management operations require more resources to achieve better efficiency and productivity.

However, the cost incurred in hiring those resources also increases the operational cost. Not to mention, the human errors involved also adds to the operational and maintenance cost. That’s where logistics warehouse automation comes into play!

You can easily automate complex and mundane operations, including data entry, product categorization, inventory tracking, inspection, etc. Furthermore, you can even use chatbots for your customer support and real-time business inspections. That eventually reduces your operational cost and makes your business a profit-generating venture!

Which Operations Can Be Automated Via Warehouse Automation Software?

Now that you know the exemplary benefits of implementing automated warehouse systems, let’s quickly discuss the operations that can be automated using warehouse automation software!

Inventory Management

Warehouse automation helps you retrieve real-time data from your inventories. That means you can easily check the demand for certain products, their stock levels, and their accurate position in your warehouse. Moreover, automated warehouse systems also track the movement of your inventories from one location to another, further streamlining your inventory management tasks. 

Product Shipping

Shipping is one of the vital aspects of the logistics business as it is associated with your customer experience and brand value. Even a single error can lead to negative CX and loss of reputation. That’s why leading companies like Amazon use warehouse automation software to automate and enhance their shipping processes.

Automated shipping systems use conveyors, scales, dimension sensors, printers, and software applications to determine available carriers, estimate shipping rates, and apply labels to packages for shipment. Logistics warehouse automation uses sensors and data from various touchpoints to determine the most suitable carriers, shipping rates, and accurate customer information. 

Returns Management

Returns management is also one of the vital components of the logistics businesses. The product returned must be allocated to the right shelves, and their amount must be indicated in the balance sheets for accurate accounting. 

However, manually doing all that can consume resources and time! That’s where automated warehouse systems come into play. You can easily manage the returns and know the exact reasons for returns using warehouse automation. Furthermore, autonomous robots can also place the returned items into their respective positions with human aid. 

Load Planning

Knowing the optimal load capacity of each of the carriers, the best positioning of the items, and the real-time location of your assets is essential. An efficient warehouse management solution easily automates all those tasks. 

You can check the available carriers, place the products in the best possible stack for optimal load capacity, and visualize your load planning process using 3D models with automated warehouse systems!

Also Read- Load Planning Software Development – A Complete Guide

Order Picking and Sorting

In a logistics company, all the products have different care techniques. For instance, fragile products must be categorized and picked with different techniques, and the bigger ones can be handled using other tools and techniques. 

However, categorizing and handling all those products can be tedious for humans. But that’s not the case with warehouse automation solutions. Autonomous tools based on AI can easily check the products and handle them with the desired care without any human involvement. They can automate the loading/unloading process and sort the items based on different requirements.


What are the Technologies Involved in Warehouse Automation Software?

An automated warehouse management system works on multiple next-gen technologies that differ per your business requirements. However, before proceeding with warehouse automation software development, you must know the most popular tech to help you achieve operational efficiency and business profitability. 

Cloud Computing

Cloud computing is one of the primary technologies used by modern warehouse software. Cloud computing offers you better extraction storage and analysis of business information. You can easily analyze tons of data generated by smart sensors to generate meaningful business insights.

The data generated by cloud computing can be used to make informed business decisions that yield profits and better revenues. Besides that, storing your data in the cloud makes it secure against natural disasters and accidents.  

Mobile Robots

Another popular technology used by modern automated warehouse systems is autonomous mobile robots. Smart mobile robots easily transform your tedious and complex warehouse operations into a piece of cake. 

That means all the tasks, including product movements, categorization, loading/unloading the products from trucks, and site inspection, can be done via autonomous mobile robots. 

In fact, smart AI technology could also be implemented in vehicles to make them autonomous, i.e., vehicles without any human drivers. That saves a lot of time and operational costs for logistics companies. 

AI and Data Analytics

Data is the core aspect of winning today’s competitive market, and combining data analytics with AI makes businesses even more profitable. That’s why many leading companies today use AI-based data analytics services to empower their decision-making process. In fact, AI has today become the most popular technology used in logistics software development.

Data analytics services encompass data visualization, modeling, demand predictions, and fraud detection methods that can benefit your logistics business. You can uncover KPIs for your business and check which campaigns are performing well!

Smart Tracking

Tracking your assets, drivers, and equipment is essential to a successful logistics business. That’s why automated warehouse systems leverage smart tracking functionality to offer the admin the real-time location of various assets. For instance, you can know and optimize the usage of your equipment. Similarly, you can also track the real-time location of your products and provide that info to your customers for better CX. 


Finally, we have IoT, the internet of things, as the most popular next-gen tech for automated warehouse systems. IoT-based warehouse software can help you get better control over your logistics business. IoT sensors do everything from monitoring the temperature and moisture to getting data from various touchpoints!

You can avoid accidents at conveyors or trucks and even check whether your workers are at the site. IoT sensors can also optimize inventory control and management operations by synchronizing your data in an easy-to-access network.  

How to Implement Automated Warehouse Systems in Your Business?

Understand Your Business Goals

The foremost step to implementing any smart solution into your business is to analyze your requirements, and automated warehouse systems are no exception! You must understand your core business goals to maximize your ROI and success rate.

As yourself, questions like:

  • What are my business goals for the next ten years or fifteen years?
  • Do you feel a lag in your warehouse operations compared to other competitors?
  • Have you witnessed any concerns regarding your product shipment or delivery that have harmed your customer services?
  • Are your warehouse operations labor-intensive?
  • Is your operational cost rising due to manual processes that require more resources?

Answering questions like these will help you understand why you need logistics warehouse automation and what effects it can have on your business. Moreover, creating an effective software development strategy will also be easier with a clear understanding of your business goals. 

Frame an Effective Logistics Warehouse Automation Strategy

The next step for developing automated warehousing solutions is to frame an effective strategy. Now that you clearly understand your business goals, you need to figure out the best use cases of AI in logistics.

However, that’s not all! Besides business analysis, you also need to analyze the latest market trends and your competitors to build success for your digital enterprise solution. For instance, several next-gen technologies can play a vital role in your logistics warehouse automation. However, choosing the reliable and resonates with your business goals is essential.

That’s where expert consultation comes into play! While framing an effective development strategy, connect with industry experts. You can look for a company that offers consultation services for your warehouse automation software development. 

Decide the Kind of Warehouse Automation Software You Need for Your Business

That one’s most important! After you have analyzed your business concerns and connected with the experts, selecting an appropriate warehouse automation software is time.

To those who are new to the logistics warehouse automation field, there are majorly three types of automated warehouse systems that you can build for your logistics business. 


WMS stands for warehouse management software, which is most commonly used in every leading logistics company. WMS offers features that streamline your inventory, quality checking, audit, invoicing, product categorization, and stock-moving processes. A modern warehouse management system also works efficiently on mobile devices to offer more flexibility to users.

Also Read- How to Develop Cloud Warehouse Management Software?


WCS stands for the warehouse control system. As the name suggests, it is an automated warehouse management system that deals with the flow of your inventories and cartons from one location to another, the management of your moving machinery (conveyors, sorters, etc.), and material optimization. It also controls the inventory utilization, and customer demands processes and enhances the overall product quality checking and storage operations. 


WES is robust warehouse automation software that combines the above two solutions. WES stands for warehouse execution software and basically does everything that WMS and WCS do. You can easily streamline every aspect of your business, from inventory management and product categorization to the flow of inventories and machinery management; everything can be synchronized with WES.

WES is mostly suitable for small and mid-sized logistics companies with fewer management products and a few simplified operations. 

So, which software to choose for your logistics warehouse automation?

Well, that depends on your business requirements and future goals. If you want to begin, investing in WES or WCS could be the best option. However, if you want to experience complete warehouse automation, then AI-based warehouse management software development could be the best solution!

Hire a Reputed AI Software Development Company

After you have identified and selected proper warehouse automation software, the next step is to hire a reliable AI software development company. You need to partner with a development company that understands your business requirements, have adequate knowledge of the latest market trends, and offers you a comprehensive range of software development services.

Your chosen development company should also have experience in developing and delivering similar AI development services to companies of your niche. For that, you can look at their portfolio. Portfolio refers to the past project a company has delivered. With it, you can check whether your chosen company has any experience in logistics warehouse automation.

Besides portfolio, you can also check customer reviews of that company to know their delivery processes and customer services. However, do not rely completely on portfolios. That’s because if any company has not worked on warehouse automation software development, but has delivered a similar AI solution, say AI-based inventory management or AI-based fleet management solution; it also shows the relevant experience of that firm.

Hence, choose wisely! Furthermore, explore other software development services offered by your partner, such as technology consulting, testing, UI/UX, cloud integration services, legacy software modernization, etc.

In short, only choose a company with extensive knowledge of the latest market trends and offers a full set of software development services. 

Develop, Test, and Deploy Your Solution

Once everything is finalized, the last step is to develop automated warehouse systems for your company. However, while developing your enterprise solution, you must take care of several things. To name a few, we have:

  • Always follow the agile development methodology for creating your automated warehousing solution. That’s because the agile method allows you to check your product after every stage of development. That means you can easily verify whether certain functionalities or designs match your brand value.  
  • Make sure your automated warehouse management system is scalable, i.e., you can add or remove functionalities from your solution without compromising performance. 
  • Choose a reliable cloud platform for storing your warehouse data. That’s because the cloud offers users scalability, flexibility, and security. You can easily provide access-based rights for accessing the warehouse data to your employees. Moreover, in case of any disaster, your data will remain safe, eventually ensuring a successful business. 
  • Make sure that your automated warehouse systems integrate easily with other third-party solutions. In today’s competitive world, it is essential to have a digital enterprise solution that can optimize various facets of your business. However, a single solution cannot do everything! That’s why you must ask your development partner to create a solution that can be easily scaled and integrated with other third-party solutions, including ERP, inventory management, fleet management, etc. 

Once you develop your product, the next step is to test and deploy your solution. Testing is vital to software development as it ensures an error-free product for your business. With testing, you can easily identify the smallest hugs left unnoticed during development. 

So, choose between manual or automated testing services for your logistics warehouse automation. Lastly, deploy your solution over a reliable cloud platform.

warehouse logistics automation

What are the Common Challenges that You Might Face During Warehouse Automation?

So, you have explored logistics warehouse automation and are ready to deploy automated warehouse systems into your business. But have you uncovered all the risks and challenges associated with warehouse automation software development? 

Despite many excellent benefits of automated warehousing solutions, there are some pitfalls that you should address. For instance,

  • Setting up an automated warehouse management system and maintaining it can increase your operational cost.
  • You must have an experienced team of engineers that can easily scale your solution and resolve all the possible glitches, if any. 
  • The downtime due to part breakdown or solution glitches can impact your revenues and customer experience. 
  • Data storage and analytics services that help AI solutions predict accurate numbers and future demand forecasting can be tedious for enterprises. 

Many such issues can impact your logistics warehouse automation. Hence, one of the most effective ways to address all those challenges is to partner with a reputed software engineering studio. 

An experienced software engineering services company having expertise in AI software development can easily assist you in deploying and maintaining your warehouse automation software. They will even suggest the best technologies and practices lower your operational cost while bringing efficiency into your logistics company.

How Much Does Automated Warehousing Solutions Cost?

After learning about warehouse automation software development, many of you might have this questions about the cost of development. Like other enterprise solutions, the cost of automated warehouse systems also depends on your business requirements.

For instance, the cost of an automated warehouse management system with an NLP-driven chatbot, computer vision, and robotics functionality will be much higher than automated warehousing solutions with basic features. Besides that, there are many other factors, including the team size working on your project, your chosen hiring model, UI/UX components, testing method, etc.

That’s why at Matellio, we offer a free consultation service to our clients to help them understand their project’s scope and get an exact quote matching their requirements. You only need to fill out our consultation form to book your free 30-minute consultation slot. Our experts will handle everything after that. 

Final Takeaway!

Today’s era is all about automation, excellent customer services, and lesser risks for employees, and automated warehouse systems offer all these things. With next-gen technologies like AI, ML, cloud computing, IoT, and Cotbots (collaborative robots), logistics businesses can easily win the competition curve while stepping towards Industry 5.0!

However, companies new to the logistics warehouse automation sector should know the investment and maintenance costs of deploying automated warehouse systems. They must have the resources required for warehouse automation and possess the skills to evaluate the results provided by warehouse automation software. And the best way to do that is by partnering with a reputed enterprise solutions development company like Matellio.

With over a decade-long experience in software engineering, and experts working with multiple next-gen technologies, we can offer you the best warehouse automation software tailored to your business needs. You can leverage our state-of-the-art AI development services and other software engineering services to facilitate warehouse automation for your brand.

Just fill out our form to book a free 30-minute consultation with our experts and get a no-obligation quote for your custom enterprise solution absolutely free!

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