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H-E-B Swisslog Partnership |
NEWS |
Recently, Texas-based supermarket giant H-E-B announced its partnership with warehouse automation specialists, Swisslog to deploy several automated micro-fulfillment centers (MFCs) towards supporting the supermarket chain’s curbside pick-up and delivery operations. This partnership, along with enhancing H-E-B’s order processing capability, enables shorter delivery time by being closer to customers, reducing human contact, and allowing associates to fulfill orders without getting in the way of shoppers in stores. H-E-B’s planed MFCs will feature Swisslog’s SynQ software, which, as per Swisslog, would allow a “goods-to-person” solution that can be used in dark stores, MFCs, or even fully automated grocery stores in the future.
Major Players Forging Ahead |
IMPACT |
The rise of automated MFCs over the past 3-4 years has stirred from being promising experimentation to being a full-fledged portion of omnichannel strategy for major grocery players across America, who hope to compete with Amazon’s desirable two-hour grocery delivery offering.
Technological Deployment Leads to Efficiencies |
RECOMMENDATIONS |
With e-commerce growing and spreading its wings over the online grocery industry, tech giants like Amazon are emerging as the major players. It is apparent that a cost and time effective path to online grocery fulfillment and last-mile delivery is imperative. There are several important factors to consider with site selection, with a major one being space.
Along with the high costs of deploying advanced robotics and accompanying software, a major hurdle in terms of setting up fulfillment centers seems to be the rising costs of real estate in urban neighborhoods with high population density. Ocado has been the leading firm in addressing this problem on a global scale. They recently invested US$23 million in ‘vertical farms’ to grow produce near distributors in urban areas. Ocado is not the only player venturing into vertical farming and warehousing for urban grocery needs. Boston-based robotics start-up Urbx plans to build an automated grocery store that stretches 150 feet tall while occupying only 1,800 square feet of space by end of this year.
Another crucial friction that needs to be addressed is the inefficiencies surrounding loading and unloading. Ocado states that the two human-operated procedures, decanting and picking, costs about US$9 million per warehouse per year. To work around this issue, they have acquired two US-based robotics firms, Kindred Systems and Haddington Dynamics. With the end goal to have “dark” fulfillment centers, which would be fully automated and employ virtually no people, Ocado hopes to add US$38 million to its annual revenues because of these acquisitions. Leveraged surface areas resulting from a streamlined dock-to-stock process and shorter load/unload time due to minimal human contact will be the driving forces behind lowered operating costs resulting from automation.
Fully automated loading and unloading systems potentially allow extreme efficiency when working with stock flows requiring speed, which is the case for consumer-packaged goods. Additionally, the precision it offers brings a degree of consistency in warehousing activities, which ensures a higher level of operator and product safety, resulting in lesser chances of product wear and tear. Automation undoubtedly holds the key to shaping up logistics and fulfillment for consumer-packaged goods in the future.
