"Automatically pack better?" Optimization and automation in the e-commerce warehouse

Workload distribution in e-commerce warehouses

In an e-commerce warehouse, two central processes determine operational effort: order picking and packaging. While order picking represents the largest time and cost factor at around 50 to 55% of warehouse working time, packaging also plays a significant role. Analyses show that approximately 20% of total working time in warehousing and distribution is spent on this area. The remaining activities are distributed across goods receiving, storage, shipping preparation, and administrative tasks.

Personnel costs account for up to 70% of the largest share of warehousing costs. The manual process of picking and packing particularly drives these costs up. While order picking is considered the main cost driver, packaging also causes considerable expenses – both through working time and through consumption of packaging materials such as cartons, filling materials, and tape. Typically, between 8 and 15% of fulfillment costs are attributable to the packaging process. Given this cost structure, the question arises to what extent optimization or automation of packaging processes can be sensible.

When is packaging automation worthwhile?

Volume threshold: A fully automated packaging machine is generally worthwhile only from a certain shipping volume. Industry examples show that an investment can pay off starting at approximately 800 packages per day. Packaging system manufacturers also report that from ~800 shipments/day, there is a good business case for automated packaging. Many companies mistakenly believe they need "thousands of packages per day" for economic viability – in reality, the threshold is often lower. Important factors influencing economic efficiency include:

• Personnel costs: High labor costs favor automation, as machines can replace the work of multiple packing employees. An automated system operates approximately 20 times faster than a manual packing station, allowing significantly more shipments to be processed per shift.
• Cost savings: Automated machines produce perfectly sized cartons. This reduces shipping costs (less volume, more packages per truck) and material consumption (hardly any filling material, optimized cutting). These savings flow into the ROI calculation.
• Investment costs and ROI: Modern packaging machines typically have an amortization period of 2–3 years (24–36 months). In individual cases, an ROI of < 12 months has even been achieved when savings potentials (personnel, postage, materials) were particularly large.
• Volatility and growth: Regardless of current package volume, many shippers invest preventively in automation to be prepared for future growth and peaks. Fluctuating demand (e.g., seasonal business) can be more easily managed with a machine, as it handles load peaks more efficiently.
• Soft factors: Aspects such as process quality (consistent packing quality, fewer errors) and sustainability (smaller packages = less CO₂) also play a role. An automated solution often enables more sustainable packaging, which meets corporate image and customer requirements

Investment in a packaging machine: A sample calculation

What matters in every automation project are the costs and the ROI (Return on Investment). The same question arises for packaging processes: whether the investment is worthwhile or not. This depends on a precise analysis of unit costs – that is, what costs arise per packed package.

Before acquiring a packaging machine, companies should therefore conduct a comprehensive cost-benefit analysis. This includes acquisition costs, ongoing operating costs, and of course a comparison with manual packaging (the current process).

Investment costs (example figures)

Acquiring a packaging machine involves high initial costs:

• Machine: approx. €765,000
• IT integration: approx. €45,000
• Total capital requirement: approx. €810,000

Annual operating costs

In addition to investment costs, annual operating costs must also be considered:

• Depreciation over 8 years: approx. €101,250
• Interest costs (4% p.a.): approx. €15,300
• Maintenance costs (variable, depending on manufacturer/machine type)
• Total costs per year: approx. €116,550

Comparison: Manual vs. automated packaging

The main factor for profitability is the unit cost consideration, i.e., the costs per packed package. This reveals a significant difference between manual and automated packaging:

• Manual packaging: 20 packages per hour, cost per package: approx. €2–3 (higher labor costs)
• Automated packaging: 300 packages per hour, cost per package: approx. €1.67

When is the investment worthwhile?

Automation can be particularly worthwhile when savings from reduced personnel costs, lower material consumption (this is often forgotten), and optimized logistics processes exceed the investment costs. A company should therefore conduct a detailed calculation, also considering factors such as scalability, production peaks, and long-term efficiency gains.

A simple calculation example illustrates this:

• Assume a company packages 5,000 packages daily.
• With manual packaging (€2.50 per package), costs amount to €12,500 per day.
• With automated packaging (€1.67 per package), costs are only €8,350 per day.
• Savings: €4,150 daily, which extrapolated annually means over €1.5 million in savings.

This calculation shows that investment in a packaging machine can amortize within just a few years. However, what remains decisive is conducting a realistic calculation of your own operational processes and future growth opportunities.

Challenges and maintenance requirements of packaging systems

Complexity of fully autom