Shanghai Evans Investment Management Limited

Modula China: Industry 4.0 and Precision Storage

Industry 4.0 is a focus of SEIML and an important trend in China as the country looks to upgrade its manufacturing processes for greater efficiency and quality.  But, in these ‘smart warehouses’ we are seeing important interdependencies as automated processes (using robotics) require the entire assembly process to be operated with very precise motions; robots have little or no discretion in their movement.  In addition, you have both inputs (raw materials) and outputs (finished goods) to/from production lines and these storage points must also be managed with precise relationships to the automated manufacturing processes.  This brings us to the topic of ‘precision storage’.

Modula ( ) is the name of the Italian company that designs and manufactures automatic vertical warehouses.  It serves its 15,000 clients around the world with manufacturing facilities in Italy, America and Suzhou, China.  It can benefit companies in any type of industry with its vertical space-saving design.  It provides practical and efficient storage for any industrial sector or environment.  Also, the units are designed to be resistant to earthquakes.  However, I want to focus on the specialised role it has in supporting the development of Industry 4.0 in China.

I visited the Modula Suzhou factory on 20 March 2020.  My first impression was that it was very large; it has a capacity to produce 900 units per year.  The next thing I noticed was that in the production warehouse there were very few people, maybe seven or eight in total.  The processes Modula uses in its own construction are highly automated and I saw many robots, large and small, made by KUKA, Hyundai and Comau.  The human intervention was at the very beginning, bringing new raw materials into the plant, or the very end, loading the finished products onto trucks for delivery.  The few other people in the warehouse were there just to monitor the processes through a computer system with a software package controlling everything that happened and when.

Sometimes when we look at robots in factories, we think they are ‘smart’ and can make decisions of their own.  Actually, robots in manufacturing are ‘dumb’ in that they only carry out precisely defined movements and actions as controlled by the software program.  They are simply machines controlled via computer programs.

This means very careful and substantial programming must be done to map out all the activities.  It also means that the warehouse must be set-up so that everything is aligned with the utmost of precision.  If one component is, say, a couple of centimeters off where the robot will place something, then the whole process will crash to a stop.  Precision in every detail is essential.

This means all the static areas, storage, must be located in the process with the same level of high precision.  Precision storage components, as produced by Modula must not only be manufactured to the most precise measurements but must also be installed into the manufacturing plant with the most precise placement.

As precision storage is a relatively new concept, there are only five firms globally who specialise in this area and Modula is the only one with production facilities in China.  This means much quicker delivery times for manufacturing plants in China by Modula.

There are many other practical benefits that make Modula storage appropriate for any manufacturing process, even companies that do not use highly automated (robotic) processes:

  • By utilising available vertical space to store goods, you can save up to 90% of floor space allowing storage for a larger quantity of goods and making more efficient use of your environment for picking and refilling activities
  • The vertical construction is achieved by using a load-bearing structure in zinc-coated steel. This houses and supports a series of trays and a central elevator, which transports them from the various levels down making for efficient storage and retrieval of items
  • Operators are interchangeable and the Modula warehouse provides information on the status of the stored goods. This facilitates location of inventory by ensuring the traceability of goods
  • Modula solutions are also designed to store goods inside the warehouse, ensuring their security and traceability and the automatic vertical warehouses are a guarantee against theft and damage to goods

We will no doubt see in the coming years in China a continued upgrade of manufacturing facilities to more automated and precision manufacturing.  The automatic vertical warehouses produced by Modula China in Suzhou will play an important role in this highly integrated and precision driven manufacturing chain.

SEIML is engaged as a business advisor to Modula China to support its market research and assist in the company’s role in the development of Industry 4.0 in China.

John D. Evans CFA

Founder of SEIML

24 April 2020