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09/13/2021
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Transform the future of peak season logistics with robotics

How robotics brings stability and resilience to holiday logistics

As another holiday season rapidly approaches, retailers continue to reel from the past 18+ months of turmoil. In fact, Resilinc found that supply chain disruptions increased 67% annually. Meanwhile, skyrocketing eCommerce sales and plummeting U.S. warehouse vacancy further hinder peak preparation.

While many of these challenges may look similar to last year’s peak, one critical variable will be vastly different: Consumers’ mindsets. In 2020, when consumers experienced bare grocery store shelves and struggled to obtain PPE, they were more understanding of holiday gift delays. Convey found that 80% of consumers were willing to give retailers more time to deliver items due to COVID in 2020. As the severity of supply chain disruptions fades from the foreground of consumers’ everyday lives, retailers can no longer afford to miss the mark on peak preparedness. Here are three ways robotics will infuse peak season logistics with greater stability and resilience, helping retailers overcome compounding consumer frustrations.

 

Optimize for fast(er) delivery

Over the years, Amazon has consistently set the gold standard for fast, free delivery. From five-day shipping down to two-day and increasingly one- or same-day, consumers increasingly expect their goods to show up fast and free of charge. That’s even more true during the busiest shopping season of the year. Voxware found that 53% of consumers will not purchase from an online retailer who mishandled their order fulfillment last Q4.

Fast, high-volume delivery depends on highly efficient fulfillment operations. Robotics can increase warehouse efficiency in countless ways - from improved order accuracy to increased picking speeds and expedited reverse logistics. The Exotec Skypod System increases warehouse throughput up to 5X in part due to a two-minute response time for all SKUs. These efficiencies quickly add up to significant, economic benefits in addition to more on-time-in-full delivery and happy customers.

 

Increase warehouse productivity, sustainably

There’s no question the logistics industry is facing a severe labor shortage. At the end of Q2, manufacturing, warehouse, and transportation accounted for 26.8% of the open jobs in the U.S. As in years past, holiday peak will only further exacerbate the competitive labor market because of the ubiquitous need for seasonal workers.

Machine workers hold the potential to complement and augment human workers. However, it’s not as simple as “just-add-robots''. If that were true, the industry would have already resolved persisting workforce shortages. Logistics leaders must strike the right balance between human and machine workers, leveraging the strengths of both to achieve sustainable productivity. For example, humans are far superior pickers for eaches whereas robots are better at highly repetitive tasks such as roaming up and down the inventory aisles.

Robots are also better suited for short-term seasonal work. To be clear, this is not to assume that machines and humans are a zero-sum equation for all warehouse labor. Rather, robotics can help businesses prioritize long-term career stability for human workers. Every year businesses hire additional warehouse workers to support holiday peaks only to lay them off or drastically reduce their schedules come the new year. Instead of disrupting human’s welfare, companies can shift to renting additional robots to supplement their operations during peak periods and prioritize consistent, long-term employment for human operators.

When selecting warehouse robotics, prioritize solutions that are scalable and flexible to complement existing technologies and infrastructure. Exotec’s modular systems are deployed in weeks, not years and do not require a major overhaul of existing operations. Supply chain professionals must consider how the technology fits within the broader ecosystem of warehouse technology and human workers.

 

Make supply chain resilience a reality

The notion of supply chain resilience resounded throughout the logistics industry during the past 18 months. From increasing safety-net stock to diversifying manufacturers, retailers considered an array of strategies to mitigate future disruptions.

Robots present an opportunity to increase supply chain resilience and benchmark KPIs especially during holiday peak. For example, with warehouse automation, operators can more easily track operation uptime and pinpoint the cause of operational disruptions. The Exotec Control Center monitors all 4,000+ active Skypods around the world and reports 99.9% uptime with no single point of failure. Robotics also helps maximize warehouse capacity. Goods-to-person systems like Exotec support high-density inventory storage creating more space for additional inventory.

Even prior to the pandemic, most businesses’ supply chain digital transformation was already moving at a snail’s pace relative to the rise of ecommerce, increased demands for fast, affordable shipping, and ongoing logistics labor shortages. According to MHI, only 38% of supply chain and manufacturing leaders reported they were using automation and robotics up from 35% in 2016. With peak preparation beginning earlier every year, now is the time for retailers to take stock of their current supply chain and fulfillment operations, explore new strategic partnerships, and set their businesses up for success in 2022.