Embracing the EPC model for automated distribution and fulfillment projects

As companies look to optimize facilities, the Engineer-Procure-Construct is gaining traction.

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In today's rapidly evolving world of automated distribution and fulfillment, the need for efficient project delivery has never been more crucial. As companies strive to optimize their facilities and processes, many are exploring innovative methods to meet these demands. The Engineer-Procure-Construct (EPC) model is gaining traction as a powerful solution, offering numerous benefits for firms investing in automated solutions to distribution and fulfillment challenges.

Key advantages

Accelerated project timelines. EPC projects benefit from a streamlined deal structure that allows for significant schedule compression. By assembling all construction and material vendors during the proposal stage, cross-discipline discussions and integrated planning can begin immediately. This approach enables early identification and resolution of potential issues, resulting in smoother project progression, faster completion times and higher fidelity estimates. In fact, studies have shown that EPC projects can reduce overall project timelines by up to 30% compared to traditional project delivery methods.

Cost certainty and control. For automated distribution and fulfillment projects with tight budgets, the EPC model offers invaluable financial clarity. Companies can secure a firm, lump-sum price at contract signing, facilitating more accurate capital planning and forecasting. This cost certainty is particularly beneficial in a region where market conditions can rapidly impact material and labor costs. According to industry reports, EPC projects can lead to cost savings of up to 20% through improved efficiency and reduced rework.

Customizable involvement levels. The EPC model provides flexibility in terms of client involvement. Whether a team prefers a hands-on approach or wishes to delegate the entire project scope, EPC contracts can accommodate various levels of engagement. This flexibility allows firms to allocate internal resources optimally, focusing on core business functions while maintaining desired levels of project oversight.

Streamlined project management. One of the most significant advantages of the EPC model for automated distribution and fulfillment projects is its simplified approach to contracting. Instead of managing multiple contracts for various project aspects, firms only need to negotiate and oversee a single contract with the EPC provider. This streamlined process not only saves time but also reduces the complexity of project management. Research indicates that this approach can improve project delivery speed by up to 15%.

Innovation and long-term partnerships. Engaging with an EPC contractor opens doors to new perspectives and innovative approaches in the automated distribution and fulfillment sector. EPC providers bring their established processes and vendor relationships, offering opportunities to learn from industry best practices. These collaborations can lead to long-term partnerships that extend beyond the current project, benefiting programmatic logistics networks.

The EPC model offers a compelling solution, providing schedule compression, cost certainty, flexibility and streamlined communication. By recognizing these benefits, companies can leverage the EPC approach to deliver their automated distribution and fulfillment projects more efficiently and effectively. With potential time savings of up to 30%, cost reductions of 20% and significant improvements in project delivery speed and innovation adoption, the EPC model presents a powerful pathway for success in this dynamic industry.


About the authors

Bridging the gap between technical facility design, business model alignment and strategic planning, Clay Wagenhals integrates financial, process and organizational change consulting into turnkey solution development as staff mechanical engineer with Burns & McDonnell. With design experience in distribution, aerospace, data centers, food and consumer products, power and power distribution facilities, Clay brings diverse execution strategies and data analytics skills to project planning and execution.

Brian Chatham, an applications consultant at Burns & McDonnell, represents multiple engineering capacities and has an extensive knowledge of supplier systems capabilities, complex facilities construction and technical solutions in automated distribution and fulfillment as well as manufacturing segments. His three-plus decade, “Dirt-to-Done” experience allows for a complete picture of project scope, risks, schedule and finance to be wholistically assembled, giving clients a clear picture of the expectations and results.

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As companies strive to optimize their facilities and processes, many are exploring innovative methods to meet these demands. The Engineer-Procure-Construct model is gaining traction, offering benefits for firms investing in automated solutions to distribution and fulfillment challenges.
(Photo: Getty Images)
As companies strive to optimize their facilities and processes, many are exploring innovative methods to meet these demands. The Engineer-Procure-Construct model is gaining traction, offering benefits for firms investing in automated solutions to distribution and fulfillment challenges.

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