Warehouse and Retail Automation – Will It Replace Our Jobs?

 The use of automated solutions in warehouses, distribution centres and retail stores is not new.  Robots have been used for years to handle simple repetitive tasks and do the heavy lifting; automated till points in stores are now commonplace.

Simply moving products from one area of a warehouse to another,  out of all the tasks of a warehouse operator, probably requires the least amount of skill. Companies who have automated their systems to manage labour costs and headcount have achieved this by reducing  warehouse operator travel distances in their operations.

Further investment in innovative solutions was already a strategy of many organizations large and small, before the pandemic hit. 

What is different now?

Social distancing, extensive protective measures and staff absenteeism from illness are all impacting on productivity.  

The rapid growth of e-commerce, regarded by consumers as a safer way to shop during the pandemic, especially in the grocery sector, is causing companies to re-think their ambitions and consider how best to service their customers, both safely and profitably.  If online sales in the overall grocery market continue to be at the current level of 10% or higher, distributors will have no choice but to invest in more automated and / or mechanised systems in their fulfilment centres. 

These may range from simple answers such as mechanical assists, more conveyors that speed up the packing-to-loading-to-shipping process to more complex and sophisticated automated putaway, retrieval and picking solutions.

The case for automation

Improving efficiency and managing the cost of human resources are the main reasons to automate. Additional benefits are that the equipment makes fewer mistakes and machines can be on duty 24/7.  

More than 50% of an average distribution centre’s (DC’s) labour force is involved in picking, packing and shipping customer orders. Growth in e-commerce means handling a higher volume of orders with smaller quantities per order.  Speedy movement of goods means lower management costs, improved revenues and satisfied customers.

Automating the picking process

There are some tried-and-tested methods to pick faster.  Traditional methods such as

  • zone-picking, where goods are organized into zones with dedicated pickers
  • pick-to-light, where lights direct the picker to his next location, with or without smart carts      
  • simple goods-to-person systems where items are brought to the picker with visual instructions

Many technologies support order picking productivity and boost accuracy. Mobile handheld devices, often using IOS or Android™ technology and Bluetooth are used extensively for two-way communication, usually within a warehouse management system (WMS).  They are used to give and receive messages or instructions via voice or text and to track and confirm orders picked. 

More advanced automation tools

Goods-to-person systems are becoming more sophisticated.  The humble forklift can be replaced by automated guided vehicle systems.

Traditional hanging systems for garments have been adapted into  ”pocket sorters” that transport, sort and store goods of all shapes and sizes.       

Large scale robotic solutions are available, at a cost, to fully automate the picking process. They can pick and place products from a source into a target bin or carton. Global e-commerce, FMCG and pharmaceutical companies are already doing this.

The price hurdle

It is important to find the right balance of suitable affordable technologies and the right level of human resources, whatever your business.  The life cycle cost of is equipment is relevant, not only the purchase price.  There is a trend towards implementing solutions that are more ‘off the shelf’ and can be rapidly deployed into existing operations.  These are more accessible for medium-sized businesses that can’t justify expensive customised systems like the big operators can. 

Fears about job losses

As automated solutions take hold there is a growing fear of unemployment. But McKinsey reports that although widespread automation is inevitable, it won’t eliminate the need for humans, rather it will transform our day-to-day tasks. Automation can actually create jobs. Although low-skilled jobs may disappear, there will be more skilled jobs in equipment design, implementation and maintenance.  Humans will always be needed where technical expertise, judgment and fine motor skills are required.

With continuing pressure on warehouse labour costs and availability, contact SCCG if you have any queries regarding warehouse automation and mechanisation projects.

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Supply Chain and Logistics Specialists

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Distribution Network Strategy, Warehousing Operations, e-commerce Logistics and Warehouse and Distribution Centre Design.