ECONOMIC FEASIBILITY OF ASRS IMPLEMENTATION: EX-POST ANALYSIS OF WAREHOUSE AUTOMATION IN INDONESIA DISTRIBUTION SYSTEM

Abstract

This study evaluates the economic feasibility of post-implementation ASRS in a distribution warehouse in Indonesia by integrating financial and operational automation perspectives. The increasing adoption of warehouse automation technologies, particularly ASRS integrated with Warehouse Management Systems (WMS), often emphasizes operational efficiency without comprehensive financial validation. This research employs a quantitative case study approach with an ex-post analysis using actual operational data. The evaluation framework applies TCO, NPV and Payback Period, while financial benefits are estimated using an avoided cost approach, including warehouse space optimization and labor efficiency. The findings reveal that the total TCO over a 10-year period reaches IDR 91.92 billion, with an NPV of IDR -61.38 billion and a payback period of 29.6 years, indicating that investment is not financially feasible within the analyzed horizon. However, the ASRS implementation significantly enhances storage capacity by 181% through vertical space utilization and system-driven operations, demonstrating its role as a digital infrastructure enabler for long-term scalability. The study concludes that financial metrics alone are insufficient to evaluate warehouse automation investments, and strategic digital value must be incorporated into decision-making frameworks. These findings provide practical insights for distribution and logistics industries in aligning technology investment and economic feasibility.