Automating is not always the right call, and saying so upfront saves time and money on both sides. There are five situations in which STOKA advises against going ahead with equipment: when clear height falls short, when there are few storage positions, when the goods are too uneven to define a standard load unit, when the layout is about to change, and when rearranging what is already there solves the problem without buying anything. This page covers all five, with what to measure to rule each one out, and closes with the opposite case: when the numbers do work.
When is automating a warehouse the wrong call?
It is the wrong call when clear height falls short, when there are few storage positions, when the goods are too uneven to define a standard load unit, when the layout is about to change, or when rearranging what you already have solves the problem. In those cases equipment is an expense, not an investment.
Case 1: clear height falls short
Clear height is the distance between the finished floor and the lowest thing hanging from the roof: not the ridge, but the beam, the sprinkler pipe or the lowest light fitting. It sets how much you can gain by densifying: the ceiling is multiplying what you store today with conventional racking by up to 3 times, and no system multiplies more than that. How much of that margin applies to you does not follow from height alone; it comes out of the survey, with the load unit and real turnover. Automated pallet storage systems work in a band from 7 to 40 metres. With less than 7 metres of clear height a full pallet system does not fit, and what you should be looking at is vertical tower storage or a layout rework. The costliest mistake here is measuring to the roof instead of to the beam: those are two different numbers, and the second one governs.
Case 2: there are few storage positions
An automated system has an entry cost with a floor to it: the structure, the handling equipment, the warehouse management software (WMS, the system that decides where each item goes and in what order it comes out) and the commissioning all exist whether you have 300 positions or 3,000. That cost is spread across the positions the system creates, so when there are few of them the cost per position climbs and no operational saving offsets it. There is no universal threshold: it depends on the labour cost the system replaces, the floor area it frees up and what that area is worth where your warehouse sits. What is certain is that the analysis is done with the project’s real position count, not with a rule of thumb.
Case 3: the goods are too uneven
An automated system needs a standard load unit: a pallet, a case or a container with dimensions and weight inside a known range. That is what lets the machine pick, move and place without deciding case by case. When the warehouse holds coils, profiles of varying length, unpackaged items and pallets built any which way, there is no standard unit to define, and forcing one means repackaging the whole operation. Sometimes that repackaging pays for itself, because it tidies up the entire operation. When it does not, automating means buying a system that will work with half the goods and leaving the other half on the floor, with two operations running side by side. Standardising the load unit is, almost always, the step that comes first.
Case 4: the layout is about to change
A storage system is sized for a specific operation: this product mix, this volume, these daily movements, this location. If the company is about to move, to add a line that will change the profile of the goods, or to remodel the building, the system ends up sized for an operation that will not exist. Installation takes 3 to 4 months from the purchase order, and on top of that come the engineering and manufacturing lead times. If the operation changes shape within that window, it is better to wait until it settles. The most common case is a rented building on a short lease: the investment stays tied to a property that is not yours.
Case 5: rearranging already solves it
This is the most frequent case and the one that saves the most money. Before quoting equipment there are three levers that cost no equipment and usually relieve the operation. The first is removing stock that does not move: in almost every warehouse there is merchandise sitting in the best positions for months. The second is reassigning locations by turnover, so that what ships most is closest to dispatch rather than at the back. The third is standardising the load unit, which is in any case a prerequisite for any future automation. If after those three the warehouse still does not fit, the constraint is genuinely volume and equipment makes sense. If it does fit, automating would have been overspending.
And when do the numbers actually work?
Payback is calculated using the full investment and your operation’s net savings. Separate genuine expense reductions from capacity available for growth; freeing space or time does not automatically save cash.
How each case is ruled out, with numbers
The five cases are ruled out by measuring, not by opinion: clear height to the lowest beam, the positions the system would create, whether a standard load unit is possible at all, whether the operation will change shape within the next year, and what happens if the non-moving products leave the warehouse. STOKA runs that assessment at no cost with your operation’s data, and if any of the five cases applies, we say so. A project that does not add up is a worse deal for us than not selling it: it shows at commissioning, not at signing.
Frequently asked questions
We do not work with a minimum height: clear height defines which systems fit, not whether the warehouse qualifies. Automated pallet storage systems work between 7 and 40 metres. With less than 7 metres of clear height — measured to the lowest beam or pipe, not to the roof — it is worth looking at vertical tower storage or a layout rework before a full pallet system.
There is no universal figure, and be wary of anyone who gives you one. A system’s entry cost is spread across the positions it creates, so the threshold depends on the labour cost it replaces, the floor area it frees up and what that area is worth where your warehouse sits. It comes out of the survey.
Almost always. Removing stock that does not move, reassigning locations by turnover and standardising the load unit cost no equipment and usually relieve the operation. If after those three the warehouse still does not fit, the constraint is volume and equipment makes sense.
It depends on how much of the lease is left. A system is installed in 3 to 4 months from the purchase order, plus the engineering and manufacturing that come before, and it pays back over years. On a short lease the investment stays tied to a property that is not yours, and that is one of the cases where we advise against going ahead.