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Supply Chain News: Yet Another Analyst Firm Expects Major Growth in DC Robots

This Week: Robots will be in 50,000 DCs by 2025, ABI Says
March 27, 2019
SCDigest Editorial Staff

It's rare to find almost universal consensus on anything in supply chain, but we appear to be close to that with mobile robots and distribution centers.

 

In recent weeks, SCDigest has shared bullish predictions on robots from leading analysts.

 

Dwight Klappich of Gartner, for example, recently predicted that over 30% of operational warehouse workers will be supplemented, but not replaced, by collaborative robots by 2023.


Supply Chain Digest Says...

It seems clear it will soon be I, Robot in a DC near you.


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Klappich note that "Next-generation AMRs are already transforming warehouse operations, as these truly become more autonomous and intelligent," adding that mobile robot costs and complexities are coming down, which opens the market to more companies to test and adopt robot technology in the DC.

 

Then John Santagate, who runs a research service specific to industrial robots for IDC, predicted that by 2020, "65% of ecommerce operations will make use of autonomous mobile robots within their order fulfillment processes, thus helping increase productivity by over 100%."

 

100% improvement – that's a big number.

In February, research firm Tractica predicted in that nearly 1 million warehouse and logistics robots will ship by 2022.


This week, analysts at research ABI upped the ante, estimating that more than 4 million commercial robots will be installed in more than 50,000 warehouses around the world by 2025, up from just under 4,000 warehouses in 2018. However, this includes all forms of DC robots, such as automatic palletizers, not just the mobile robots considered by Klappich and Santagate.

The rise in robot adoption rates will be driven by the increasing affordability and return on investment (ROI) of a growing variety of infrastructure-light robots, as well as continuing needs for flexible and efficient automated fulfillment as same-day delivery becomes the norm.

 

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“Flexibility and efficiency have become primary differentiators in the e-commerce fulfillment market as retailers and third-party logistics (3PLs) struggle to cope with volatile product demand, seasonal peaks, and rising consumer delivery expectations,” said Nick Finill, a senior analyst at ABI Research. “Robots enable warehouses to scale operations up or down as required while offering major efficiency gains and mitigating inherent challenges associated with labor and staffing.”

 

Both automated guided vehicles (AGVs) and autonomous mobile robots (AMRs) are driving the growth that are directly replacing heavier mechanized automation that typically requires massive upfront investment and rigid physical infrastructure, ABI said.

 

The research firm added that robots enable the optimization of space in expensive warehouse facilities and can reduce the need for new and costly greenfield fulfillment centers. The company cited vendors such as Fetch Robotics, Geek+ and inVia Robotics as those that enable additional robots to be added or removed from a fleet as operational demands require, as well as allowing for easy and relatively rapid reconfiguration of entire workflows and operations if product lines or fundamental operational requirements change. “This is a major advantage in the unpredictable and dynamic e-commerce market,” ABI Research said.'

 

Key Role of AI

 

In addition, advances in artificial intelligence, deep learning, robot mechanics are giving robots the ability to perform traditionally harder-to-automate tasks. ABI cited manipulation robots from companies such as RightHand Robotics and Kindred Systems that can enable a wider variety of individual items to be picked and placed within a fulfillment operation. “By combining mobile robots, picking robots, and even autonomous forklifts, fulfillment centers can achieve greater levels of automation in an efficient and cost-effective way,” the research firm stated.

 

Furthermore, robot vendors are increasingly providing flexible pricing options, especially through robotics-as-a-service models, giving companies the chance to replace large capital expense (CapEx) costs with more accessible operation expense (OpEx), giving mid-market companies adoption options they didn’t have before.

 

“By lowering the barriers to adoption for robots in the warehouse, vendors are disrupting the wider logistics value chain,” said Finill. “If advanced automation becomes possible for midsize e-retailers, they will be able to fight back against the dominant players and also bring fulfillment operations back in-house, disrupting the relationship between retailers and 3PLs.”

 

It seems clear it will soon be I, Robot in a DC near you.


What are your thoughts on major growth in robots in the DC? Why or why not? Let us know your thoughts at the Feedback section below.

 
 

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