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AGV ROI Starts with a Delivery Commitment

by Mike Kotzian   |   January, 2022

The best automation solution on paper means nothing if it cannot be delivered in 2022. Selling the sexy sizzle of new, clever, even remarkable AGVs means nothing if manufacturers and distribution centers cannot take delivery of the product until 2023.

So much emphasis has been placed on features, advantages, and benefits; too little attention has been paid to delivery dates. Throughout industrial manufacturing and distribution the lead time from many AGV manufacturers is more than a year. That means product ordered in Q1 2022 will not be delivered until the following year. That is an absurd lead time and reflects poor planning and unnecessary supply chain constraints.

Large Kivnon System at a Global Automotive Supplier

One of the realities of moving materials on a production loop with 30 stops is that well-established, tried, and trusted AGV technologies, will solve the problem. Likewise, most AGVs are needed for simple A to B location (dock to production cell) delivering raw materials or kitted solutions. Using an analogy, not everyone needs a Tesla with all the cool bells and whistles?a Chevrolet vehicle will suffice for most.

The need for AGVs is real

Years ago, the efficacy and merit of the technology had to be explained as some feared that fork truck drivers would be replaced. Ask any manufacturer struggling to find workers right now, the ability to order AGVs and take delivery by Q3 2022 is a big deal. As plant managers, purchasing, and occupational health and safety professionals are tasked with automation objectives, hiring objectives, and production quality and safety process improvement, the standard ROI paradigm has shifted for 2022.

The supply chain disruption - even new fork trucks cannot be delivered until 2023

The question several years ago might have been fork truck or AGV? The average delivery time for a new fork truck is also up to a year, making that riddle a moot point. The question from purchasing was which vendor could best demonstrate the fastest ROI and cost-justification. That question is also dated because ROI can only be calculated from the date of delivery and rapid installation.

K10 One-Way: One-directional movement. Towing capacity of up to 3,000 kg/ 6,614 lbs on wheeled trolley. Dimensions (L x W x H): Up to 1,700 x 500 x 280 mm/ 67"x 19,7" x 11" Magnetic navigation

The AGV selection process for 2022 is about a delivery commitment

AGV vendors must promise a delivery date with a guarantee not to exceed 180 days from purchase order to delivery. Failing to provide that commitment is unacceptable. Granted, a particular model may not be the customized "tricked out" version of an AGV with major software integration, nor the most deluxe IIoT, Machine Learning, Industry 4.0 version. It will solve the immediate challenges in production by delivering product in Q3 2022 and mitigating the hiring constraints plaguing industrial HR managers.

K11 Two-Way: Bidirectional movement; Towing capacity of up to 3,000 kg/ 6,614 lbs on wheeled trolley. Dimensions (L x W x H): Up to 2,010 x 500 x 280 mm/ 79" x 19,7" x 11" Magnetic or mapping navigation

Mike Kotzian is currently the Managing Director of Kivnon USA, a leading Automated Guided Vehicle supplier with Farmington Hills, Michigan headquarters. He has over 20 years of experience in the AGV industry in various leadership roles. He has a special interest in the history and evolution of the AGV with a passionate look to the future. See More Details.

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