What metric should businesses use to evaluate cold storage automation investment beyond inventory turnover rate?
Answer
Total Cost of Non-Compliance (TCNC).
When evaluating the substantial capital investment required for automated cold storage, particularly facilities handling sensitive items like biologics or high-value perishables, businesses are advised to calculate the Total Cost of Non-Compliance (TCNC). This metric captures the catastrophic financial impact of failure, such as total product loss and massive liability resulting from a temperature excursion caused by mechanical failure or slow manual handling. Automation directly mitigates TCNC by reducing internal transit time and ensuring tighter temperature adherence, often making the defense against TCNC a primary driver that outweighs the initial system expenditure over the long term.
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