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5 factors to consider for private 5G in smart warehousing

Following analyst house ABI Research and US network design and services firm Betacom’s recently released white paper, Private 5G in Warehousing, Enterprise IoT Insights delivered a few key takeaways on the topic. These takeaways primarily focused on the U.S. market, where Citizens Broadband Radio Service (CBRS) has made deploying a private in-building wireless network a reality for many.

“Connectivity will be a main driver behind Industry 4.0, as machines and production assets will need to be connected to transmit data,” the white paper said about the necessity of private 5G networks in warehouses. “Connectivity will also be one of the keys for warehouse operators to unlock the benefits and efficiency enhancements promised by automating and digitizing workflows and processes.

“Private 5G will be an important building block for these enhancements, as it provides important features that will address warehouse managers’ key pain points.”

Keep reading to see additional key takeaways when it comes to private 5G in smart warehousing.

Industries must be willing to pivot — quickly

Warehouses and manufacturers can benefit from embracing the digital shift in their industry. Private 5G networks can help create higher efficiency, better quality, more productivity as well as less energy and labor use. It’s a win for all sides as less energy use is better for the planet and businesses can potentially meet their environmental, social and governance (ESG) targets.

While every industry could benefit from the advantages private 5G can deliver, the logistics industry and warehouses are under more pressure to leverage this technology, Enterprise IoT Insights reports. Factors such as climate change, energy crises and economic recession put the old supply chain model’s vulnerability on full display and show how crucial it is to bring tech-driven solutions into the fold.

Connectivity, cellular in particular, is a top priority

While many industries can benefit from network flexibility, the warehousing and manufacturing sectors might be two that need it the most because of the number of applications they use, according to the whitepaper. New cellular and 5G technologies can help warehouses make their environments more orderly. Other solutions such as Wi-Fi and Ethernet have their uses, but likely can’t deliver the reliability or flexibility that a private 5G network could. Private wireless networks are designed specifically for rapid deployment and to make managing smaller enterprise venues easier.

“Private 5G guarantees a high level of integrity and data sovereignty, meaning highly critical warehousing data, such as the condition of workstations, pallet positions, or autonomous vehicles, can remain on the warehousing premises and will not have to leave for external processing,” ABI Research said.

Private 5G networks are good for business

ABI Research found that warehouse companies that connected their existing apps, security camera systems, robot automation projects and more to their private 5G networks saw a significant return on investment, Enterprise IoT Insights reports. The firm stated an average U.S. warehouse with “a private network for smart warehousing applications” could see $13.80 for every dollar invested during a five-year span. Additionally, “an average warehouse” could see an almost 12 percent increase in gross profit margin and $284.17 million in operational cost savings during that same time period.

On the other hand, warehouses that opt not to deploy a 5G network could potentially forgo $231 million in unrealized profit and ship 6 million less packages, according to the report.

Private 5G can also be good for the environment

With Internet of Things (IoT) tools available to monitor and report warehouse’s energy reduction, the industry has an opportunity to deliver on its ESG commitments, according to the whitepaper. Every warehouse operator could decrease their energy consumption by 2,000 megawatts per year, according to ABI Research.

“This will increase the sustainability of the sector, as it will decrease each warehouse’s carbon dioxide (CO2) emissions by almost 700 tons per year,” the research firm said.

Deploying private 5G networks is a team effort

Warehouse operators do not have go through the 5G deployment process alone. There are plenty of trusted technology suppliers that they can turn to so they don’t waste too much time trying to figure out which solutions to use and how to implement them. Vendors are more than willing to do any necessary hand-holding through the process. ABI Research also ensures that many vendors’ service offerings are flexible enough to help ease any initial “bill shock” that comes when they see how much the initial investment will cost.

“To ease their investment decision, warehouse operators should, from a business economic point of view, consider service-based offerings that allow each enterprise to pay for private 5G-enabled services on a long-term basis, rather than as an upfront investment,” ABI Research wrote.

Download the full whitepaper here.

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