Supply Chain Automation and Limitations of It

When it comes to your company’s supply chain, it can be difficult to change things up. If you’ve been in business for a while, there’s a chance that you’re still manually counting inventory, selecting products, packing them, and so on.

However, manual supply chain methods are not only out of date, but also inefficient and sometimes harmful to your company.

Automation in the supply chain has never been easier. Thanks to new technologies, businesses may now take advantage of automation in their supply chains. Supply chain automations may help you save money and time, enhance your company’s productivity, and prepare it for the future if they’re used correctly.

What is supply chain automation?

Supply chain automation is the use of technology to automate or simplify supply chain activities without requiring human attention, effort, or involvement.

A company may reduce the manual labor needed to complete certain business functions by incorporating automation technology such as machine learning, artificial intelligence, and digital process automation into the supply chain.

This allows for more productivity in your business and a more efficient supply chain.

Limitations of supply chain automation

Automation has several advantages, but it also has certain restrictions that you should be aware of. These restrictions may be particularly apparent in the small business supply chain, where there are fewer resources and less money available.

Currently limited to certain tasks

Automating supply chain operations is an ambitious goal. While simple activities such as order processing, inventory counts, and administrative tasks are ideal candidates for automation, the vast majority of supply chain operations will require human attention and engagement.

Although you may produce picking lists automatically and assign warehouse robots to assist you with the physical picking, these robots are still unable to make crucial judgments based on the current situation (for example, what to do if there are shortages).


Frequently, technological innovation in the supply chain requires significant financial investment, usually costing hundreds of dollars per year in subscription fees or one-time licenses.

Smaller ecommerce firms and start-up DTC companies may not be able to afford this sort of major financial investment. Typically, these companies outsource their warehousing and fulfillment activities to a tech-enabled 3PL or logistics platform in order to use supply chain automation solutions.

What supply chain processes can be automated?

While it is not yet feasible to automate the whole supply chain, merchants can use technology to automate key operations and activities to save time, money, and resources. Here are some of the supply chain procedures you should consider automating.


Administrative work and regular business procedures are much simpler with supply chain automation.

Automating accounting and finance tasks using computer programs opens up a world of possibilities. You may automatically pull data from purchase orders into your program, as well as automate finances and accounting procedures by automatically processing invoices and keeping financial records.

Automation also helps supply chain analytics because it allows a company owner to keep track of critical performance indicators without spending hours gathering data and crunching the numbers themselves.

In this manner, supply chain automations may help you better manage your present operations and develop future plans.


Automation may also be used in certain elements of your transportation operations.

Route optimization automations compare data from multiple sources and use it to optimize delivery routes and select the best carrier for shipments, saving time and money.

With real-time transit tracking, you can get superior supply chain visibility from automated software. You may keep an eye on where your trucks are going and whether there are any potential delays by utilizing this information.

You may then utilize this data to improve the transportation of your items in order to reduce operational expenses and transit times.


Fulfillment and storage are the two supply chain processes that most frequently use automation.

Certain software automations can automatically receive and confirm purchases and provide tracking information to clients during the order-processing process.

These programs can also automatically forward every purchase to the fulfillment center that is nearest to the order’s final destination in some situations.

Some warehouse automation solutions employ goods-to-person (GTP), in which machines and robots are used to help human employees in the warehouse picking process. Barcodes and light-emitting diodes (LEDs) can also be used in pick-to-light (PLT) systems, which utilize barcode scanning and illumination.

If you’re using doubles, of course. You can also utilize the box selection approach to ensure that each purchase is sent out with the most appropriate package size to minimize dimensional weight and reduce the danger of damage.

Warehouse automation systems can even recommend where to store inventory in order to make the most of available space while also increasing picking speed.


There are elements of inventory management that may be automated, because it requires human expertise.

When inventory levels get too low, you’ll receive automated reorder point notifications before hitting a specified purchase volume for a specific SKU, allowing you to time replenishment perfectly and avoid stockouts and backorders.

Automating the restocking process entirely is another option, in which case stock would be reordered automatically when a SKU reaches its limit to save time and bother.

The major advantages of automated inventory counting are the fact that it is both accurate and timely. You obtain the most insight into inventory levels by having accurate, up-to-date automatic inventories.