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Fulfillment automation: Where are 3PLs and shippers investing?

illustration of a person in a wheelchair pointing to a large monitor. the monitor shows a process line with dots and dollar signs ultimately pointing to locusbot fulfillment robot

All businesses are having to make smarter use of automation and technology today thanks to labor shortages, high inflation, and competitive pressure to keep prices down. In warehousing and fulfillment, the rush is on to further automate and streamline operations and optimize labor and space.

Demand for fast and accurate order fulfillment is only increasing with the exponential growth of e-commerce. Demand for commercial warehouse capacity has skyrocketed. In many parts of the U.S., there are serious shortages of commercial space. Some of the larger retailers and many logistics companies are even amassing space before they need it, snapping up space in facilities before they are even built.1

Warehouse automation boosts speed and throughput, supporting scalability and order accuracy which, in turn, improves customer satisfaction.2 Here are a few of the latest developments in retail and e-commerce fulfillment automation:

Bots are hot

Used to increase productivity and efficiency, Robotics is a small but fast-growing sector of warehouse automation. There are a number of robot types focusing on material handling and worker safety via social distancing or reducing injuries, such as driverless forklifts and other types of automated guided vehicles (AGVs). These traditional automated vehicles tend to travel fixed routes guided by marked lines or wires on the floor, using radio waves, vision cameras, magnets, or lasers for navigation. However, they may still require operator oversight.3

The market for AGVs blurs when you consider there are other more sophisticated forms of AGVs that can navigate autonomously—which are classified as a form of autonomous mobile robots (AMRs).  

A smarter counterpart to traditional AGVs, AMRs dynamically assess and respond to their surroundings while completing a variety of tasks—all without the direct supervision of an operator. AMRs rely on maps and sensors to navigate more flexible routes by interpreting the environment. Depending on the type of AMR, these robots can do things like count inventory when equipped with RFID, or support the picking and packing processes.

Known as co-bots, collaborative robots live within the family of AMRs, and are increasingly used in fulfillment to assist the warehouse workforce. Meet-me co-bots, such as the Locus bots used by Ryder E-commerce by Whiplash, travel to a pick area and help indicate to the worker where they should pick, freeing up workers to stay in a zone and reduce walking. Follow-me co-bots travel to the worker and lead them from one picking location to another. When full, the bot travels to a packing station. To stay efficient, another bot can be deployed to the picking worker’s location to pick up where the other one left off.4

These are just a few of the examples of AMRs which will, according to Gartner, transform warehouse operations over the coming decades as costs and complexities are reduced.5

E-commerce is the main driver of the growth in demand for AMRs and AGVs, according to research company LogisticsIQ. Both types of mobile robots are growing at double-digit rates to reach an installed base $2.4 million in 2027, making up an $18 billion market.6

Technology advances in warehouse automation 

Many underlying technologies like those found in robotics are driving advances in material handling equipment to automate fulfillment. Artificial intelligence (AI) is embedded into many types of warehouse automation solutions from AMRs and 3D bin-picking systems to tools such as dynamic slotting and workforce planning. AI generates value in the warehouse through various sub-technologies: machine learning (a specific branch of AI), natural language processing, robotics, and computer vision.7

The capabilities of 5G and the Internet of Things (IoT) are enabling supply chain transparency, visibility, and collaboration. 3PLs are investing in IoT to connect devices for visibility of assets and real-time decision-making, giving warehouse managers greater control over warehouse activities to drive efficiencies.     

Investments in warehouse automation reflect many of these trends. According to the 2022 26th Annual 3PL study, a report that surveys 3PLs and shippers worldwide, the top technologies that 3PLs plan to invest in over the next three years are 1) robotic systems in the areas of high-density storage, picking and palletizing; 2) autonomous forklifts (a type of AMR); and 3) wearables. Similarly, shippers reported their top investments over the same period to be intelligent data analytics; 2) robotics; and 3) autonomous forklifts.8

What’s up with wearables?

3PLs and e-commerce companies are looking to wearables to enhance worker efficiency with devices such as barcode scanners on wrists and fingers that eliminate manual data entry and speed up fulfillment. Advances in augmented reality, virtual reality, and 5G are enabling devices like smart glasses to do things such as greenlight the specific area for a worker to pick from. 

Other wearables include technology-filled devices such as belts laced with sensors and algorithms that detect how workers move to help them lift and load safely, and “exosuits” that resemble small backpacks that help workers to reduce the strain they feel when lifting heavy items.9

All of these forms of automation are driving warehouse efficiencies, making it easier for companies to fulfill orders across the multiple channels required in today’s retail and e-commerce supply chains.

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