Locus Robotics’ valuation has ballooned to nearly $2 billion with new funding that will help it keep pace with logistics companies and brands looking to level up their warehouse automation in response to consumer demand.
The Wilmington, Mass.-based maker of autonomous robots counts DHL, logistics company Geodis, VF Corp., Boots UK and CEVA Logistics among its customers, which span the retail, third-party logistics, healthcare and industrial industries. Companies use its robots in tandem with human labor to boost efficiencies and reduce errors in the distribution and fulfillment process.
Locus’ more than $117 million Series F was led by Goldman Sachs Asset Management and G2 Venture Partners, with the capital infusion expected to be pumped into continuing to enhance its technology, research-and-development and market expansion.
Locus sees a big runway for growth, citing a Gartner projection that 75 percent of enterprise-level companies focused on selling products will be using robots alongside a human labor pool in their warehouse operations by 2026.
The interest in warehouse automation among investors helped Calgary-based Attabotics pull in $71.7 million in Series C-1 funding earlier this month. Attabotics offers a different technology solution from Locus, with its warehouse storage systems built vertically to help customers save on real estate. Attabotics’ robots then pick items that are shuttled over to human workers. Elsewhere in warehouse automation, third-party logistics company GXO Logistics said this month warehouse technology deployment is expected to be up by more than 50 percent by the end of this year from 2021. Tech is increasingly a major source of revenue for GXO, with automated sites now generating more than a third of its overall sales.
The case for automation is being made clear particularly in fashion and retail, where multichannel selling has become the norm.
“Even as e-commerce volumes continue to increase as customers are now more comfortable with online ordering and ongoing labor shortages continue, there is more pressure on retailers to meet faster delivery times while also delivering a more complete omnichannel experience to their customers,” Locus Robotics CEO Rick Faulk told Sourcing Journal in an email discussing the new funding. “This involves implementing several new e-commerce approaches that began in the Covid era that go beyond traditional online ordering, such as BOPIS [buy online, pick-up in store], ship from store, curbside pick-up and more.”
Faulk also pointed to what he described as the “Goldilocks effect” of customers ordering multiple sizes to ensure the right fit that’s adding further pressure on logistical processes in the way of returns. That’s leading many retailers to reconsider free shipping and free returns to address the costs associated with high return rates, Faulk added.
Similar to the efficiencies Locus robots create in helping employees pick and pack orders being sent out to customers, they also help streamline the returns process once product returns to a warehouse.
“‘Putaway’ is, in effect, a reverse version of a picking scenario as disparate items need to be returned to appropriate bins quickly,” Faulk said of one of the robotic functions.
Thus, a warehouse employee can take items picked from one LocusBot and also put away an item brought by a different LocusBot.
“The worker only has to read the LocusBot screen to know what their task is versus having to operate a separate shift or team during off hours dedicated to returns, putaway and replenishment,” Faulk said.
Locus, which currently counts about 450 workers globally, has expanded its workforce by more than 100 percent in the last year, with similar growth expected in the coming year, as market demand pushes the robotics company into new markets and industries.
Said Faulk: “As demand for warehouse automation growth is driven by the labor shortage, Locus customers are expanding the size of their existing deployments as well as adding Locus to new sites around the world.”