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Amazon and AutoStore Show How Inventory Strategies Are the Secret to Keeping Consumers Happy

During the bustling holiday shopping season, retailers have little room for error when it comes to offering the product selection and the fulfillment options that shoppers are looking for.

In a retail ecosystem so saturated with options, both mass market and independent operators must maintain a presence across online, brick-and-mortar, social and mobile channels, and offer both fast delivery or the option for in-store pickup.

Amazon has long dominated in the arenas of price, product and fast, free shipping—and the company has stepped up its efforts in light of what it expected to be potentially explosive Cyber Monday activity on its well-trafficked platform.

A new service called Amazon Storage and Replenishment allows sellers to house inventory in close proximity to Amazon’s fulfillment and delivery infrastructure so that products can be replenished with speed and ease. According to documents obtained by Bloomberg, Amazon has launched the first iteration of the program in Ontario, Ca.—about 20 miles from its closest facilities. The company reportedly has plans to open similar operations throughout the country.

Amazon charges its merchants a pretty penny to store their wares in its increasingly automated fulfillment centers, which are laden with robots and advanced warehousing tech solutions. During peak capacity, the company hikes its storage prices up even higher, potentially deterring third-party sellers from stocking up the products they need to get through a Black Friday or Cyber Monday rush.

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Rather than running the risk of disappointing consumers (and of course, losing sales), Amazon’s decision to invest in bare bones, affordable warehouse space could offer merchants a cheaper solution to their inventory dilemmas.

Amazon isn’t the only company looking to augment its capacity and get inventory out the door during the holiday shopping rush.

A newly upgraded retail storage service is aiming to bring speed and efficiency in storage to retailers of all kinds—and help consumers get their hands on coveted products, faster.

AutoStore has augmented its high-density storage solution, which relies on the kind of robotic, cube-based storage and retrieval system taking over warehouses worldwide. The automated operation has now evolved to accommodate shoppers’ relentless demands on retailers for speedily restocked inventory and quick delivery timeframes ranging from same-day to mere hours—an expectation undoubtedly cultivated through their experiences with Amazon.

AutoStore’s micro-fulfillment solution brings warehousing and logistics to the store level, allowing retailers to stock up to 15,000 SKUs within 604 square meters. The company’s modular Cube Storage Automation system can be configured to fit different ceiling heights and physical barriers and obstacles, and can be used in a variety of different environments—like the stockroom of a grocery store or a retail space for consumer products.

The system relies on an aluminum grid formed from self-supporting crates, each of which can be moved to pick stations by independently operating robots. In a statement, AutoStore explained that the robots’ double sets of wheels allow them to move freely throughout the grid and access any crate, at any time.

“AutoStore delivers the flexibility and scalability needed for streamlining automated fulfillment of online orders, which is absolutely critical to accommodate increasingly higher numbers of SKUs and seasonal spikes in ordering,” Karl Johan Lier, CEO and president of AutoStore, said.

Lier added that the system “gives retailers the flexibility to make more targeted decisions about where they believe automated micro-fulfilment will be most beneficial.”