Warehouse Robotics – Why Now?

No matter what industry, if your company has warehouse operations, you need to be considering the move to robotic technology now. We are seeing the rise of global eCommerce companies from China launching services in the UK and they are coming for your business. These massive global enterprises have been successfully running mass-scale logistic fulfilment operations with warehouses that scale millions of square metres without a single human on site. Able to fulfil 90% of orders on the same day, or next day.

And the current pandemic has only fuelled our appetite for online shopping. In the UK, growth that took nine years before the pandemic, happened in a month, as online sales reached 30% of sales in April 2020, up from 18% in April 2019*. And whilst there are those who will be happy to venture out to the shops again, many have permanently switched to this new way of shopping.

So, if you’ve not identified a squat team in your business to assess the options and cost implications for moving to robotic technology, you’re quickly missing the boat. But what options are available? We see two very different routes companies can take: –
1 – go it alone
2 – partner with an eCommerce/logistics fulfilment business

Option one requires a heavy upfront investment in an ever-changing world. It is a massive infrastructure change project that requires mezzanine systems, adequate power, fencing and protection systems, internet capabilities, sprinkler systems and of course flooring that can withstand constant AGV (Automated Guided Vehicles) traffic. Identifying where the bottlenecks are in your warehouse operation is a good place to test and start.

Option two is more of a service-based option. Outsourcing to an eCommerce organisation. And there are some very tempting offers on the table. These companies are prepared to take the cost of setting up your automated smart fulfilment centre and then charging you a per transaction fee.

The first option clearly requires a mass amount of upfront investment in world that is constantly changing in terms of technology around the AGV robots. Robots created 18 months ago are already being superseded. There is no denying the level of investment could be astronomical. But the opportunities are tempting. The large UK retailers in this space have an opportunity to become eCommerce suppliers themselves for other businesses. AGV’s work around the clock, not like humans so the payback period for the initial investment can be as little as 12-18 months.

The second option takes all the headache away from the initial investment but then ties you into a per item transaction fee that could see your profit margins hampered over the longer term.

Whatever the option, sitting back and waiting isn’t one. You risk becoming less competitive and increasing your barriers to entry. The question is not whether your warehouse needs robotic technology, but when.

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