The e-commerce explosion and the concurrent demand for speedy delivery and order fulfillment in B2B and B2C markets has increased the need for technology to aid the process.
Warehousing and logistics companies are increasingly incorporating robots to reap the benefits of speed and efficiency that led to greater profitability, according to a new report from Tractica. Robotic warehousing and logistics technologies are at the same time gaining greater capabilities and, as is often the case with more widespread use, becoming more affordable.
The demand for robots and the supply of advanced robotic solutions for the optimization of logistics processes, combined with labor shortages, have created a tipping point that could lead to widespread adoption of robots in warehouses and logistics operations to assist and displace human workers.
DHL said in December that is will invest $300 million in emerging technologies to include artificial intelligence, robotic picking techniques and driverless automobiles to enable new efficiencies in the value chain. However, Tim Sprosty, senior vice president of human resources at DHL Supply Chain, said, “These technologies enhance the value of our people, they don’t replace them.”
Tractica, a market intelligence firm that focuses on emerging technologies, forecast in its report,“Warehousing and Logistics Robots,” that worldwide shipments of warehousing and logistics robots will grow to 938,000 units annually by 2022 from 194,000 units last year. Tractica estimates that worldwide revenue for the category will increase to $30.8 billion in 2022 from $8.3 billion in 2018, providing significant opportunities for established participants and emerging players.
“The warehousing and logistics robot market is experiencing strong growth, and supply chains are being transformed as companies replace fixed infrastructure and outdated processes with flexible, scalable robotic solutions to meet the changing demands of modern commerce,” Tractica senior analyst Glenn Sanders said.
The report notes that many companies are beginning to leverage robotic solutions that enable them to transform how their warehouses organize, store and retrieve items, and the logistics of how they are sorted, transported and shipped. Proven solutions and case studies have shown a rapid return on investment and strong growth in e-commerce, “while third-party logistics, labor shortages and vigorous competition are driving strong demand globally,” Tractica said.
Contract logistics firm XPO Logistics recently said it would install 5,000 “collaborative warehouse robots” at its properties across Europe and North America. The robots, capable of carting racks weighing up to 2.5 tons, are a key component of modular systems anchored by a fulfillment station where employees can work on up to 48 orders at once.
The Tractica report cites key challenges in the market as the difficulty of designing robotic systems for highly complex supply chains, initial cost, implementation of robotic infrastructure, skills gaps and human workforce training. Technological issues involve self-driving or navigation autonomy, custom order picking, warehouse layout and robotic integration, and safety and standards.
“Companies that are considering the use of robotic solutions to enhance their operations need to carefully plan and design their new system so it will align with their business now and in the future, and provide a strong position compared to their competition,” the report said.
Tractica recommends key points that could be helpful in streamlining the products and services connected with warehousing and logistics robots for long-term growth. They include carefully choosing the robotic technology and level; determining the savings and efficiencies from robotizing; measuring the immediate impact on the border-to-delivery process; choosing flexible, modular and scalable systems, and utilizing easy-to-use management platforms.
In addition, companies should choose a system that provides a fast return on investment, while becoming knowledgeable about “Robot as a Service (RaaS)” leasing opportunities and alternatives to fixed infrastructure and costs.