The evolution of the warehouse and distribution center is causing a revolution in automated solutions for everything from picking to loading, as robotics R&D accelerates.
Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
Providers of material handling solutions are feeding a growing appetite for automation in the warehouse and distribution center these days, with a special interest in robotics. Research into and development of robotics applications for everything from picking and packing to truck loading and unloading is on the rise, and the trend shows no sign of slowing down, says Crystal Parrott, vice president of the Robotics Center of Excellence at the Grand Rapids, Mich.-based systems integrator Dematic.
"It's a fascinating time to be in robotics," says Parrott, whose group works with customers to develop automated solutions that incorporate robotic bin picking and palletizing. She says advances in vision and gripping technology, computing power, and artificial intelligence are helping to propel robotics research and development, and that labor challenges, e-commerce, and omnichannel business trends are driving customers' interest in applying high-tech solutions throughout the warehouse and distribution center.
And the timing couldn't be better, as warehouses and DCs morph into fast-paced fulfillment centers that offer increasingly quick turnaround times. Finding better, more efficient ways to move products throughout the facility is at the top of just about everyone's priority list, it seems.
"The industry as a whole is going to continue to evolve," Parrott says. "And we need solutions that can help in all areas."
PICKING SYSTEMS ADVANCE
Underlying the growing interest in robotics is the sheer need to get more orders out the door faster in today's environment. Intense competition in the e-commerce sector, a rise in the number of stock-keeping units (SKUs) companies must keep on hand, and advancing technology in general are all causing companies to move toward automated warehouses and DCs, and robotics is a natural extension of that trend. A study released this spring by market researcher Allied Market Research forecasts a nearly 12-percent compound annual growth rate in the global warehouse robotics market between 2016 and 2023, reaching a market value of $5.2 billion.
Most of those solutions will be used to address e-commerce business, where demand for automation is soaring. The Allied Research report shows that e-commerce as an industry vertical accounts for the largest share of the warehouse robotics market today, followed by the automotive industry. The study also found that pick and place is the most common function performed by warehouse robotics in those environments, followed by packaging.
Parrott says labor challenges are having a considerable influence on robotics growth as well. As volume and throughput demands increase, organizations need more employees to handle the work—and those employees can be tough to come by in today's tight labor market, where unemployment is low and the need for both skilled and unskilled labor is rising across manufacturing, industrial, and retail sectors. Finding enough workers can be especially difficult for e-commerce retailers looking for seasonal warehouse help.
Robotics hold the potential to address such problems on a large scale because they can be used to perform repetitive tasks such as picking, freeing up workers for other tasks throughout the facility, Parrott explains. But the technology still has a long way to go to address the variety of products in the market with the reliability and adaptability of a human. Today's robotic picking solutions do a good job of moving products from one place to another, but further research and development will be needed before they can perform some of the more complex, precision-based tasks required in dynamic picking environments.
"At the moment, most of the piece-picking robotic applications are using end effectors with either vacuum cups or a simplistic 2/3/4 finger gripper. The robot path planning provides a centralized pick point and general extraction path to avoid collision with the bin or objects in the environment," Parrott explains. "This will work on a large number of products, [but] some products need to be picked up in a specific way and extracted [so as] not to entangle or damage other items next to them."
A top-heavy product such as a hammer, for instance, must be gripped closer to the head. Further complicating matters, the handle or nail remover portion of the head may get tangled or buried beneath other items, making the choice of which one to pick next more complex; the extraction motion from the bin will be more complex as well. Such actions require more advanced vision and path planning solutions, Parrott says.
"Additionally, most [robotic picking] applications being demonstrated [today] pick and drop the product in an order tote or container," she says. "If a large variety of products need to be [deposited] in a specific place or in a defined orientation so that they are not damaged, this requires more advanced planning on the placement side."
Parrott says she has no doubt the technology will get there, and she also points to growing investment in "mobile bots"—robots that move throughout a facility as opposed to picking arms and other stationary solutions—as another particularly hot area of research today.
"You're seeing advances in automating 'goods to person' [picking]," she says. "There is a lot of focus in this area, and we will see even more development in the years ahead."
A separate industry study underscores the point. Industry research firm Interact Analysis released a study this spring predicting that the value of the autonomous mobile robots (AMRs) market will grow to $7 billion in 2022 from $1.1 billion in 2017. The burgeoning e-commerce sector, mass personalization of goods, and a shortage of low-cost labor are driving the trend, the research firm said. Deck-load mobile robots—those that have decks or flat surfaces to transport pallets or cartons—are the most common, with 180,000 forecast to be shipped in 2022. Mobile robots with mounted arms are less commonly used, but are increasingly entering the research and development phase. Interact Analysis predicts that 12,000 of these types of robots will be sold in 2022.
Logistics is the fastest-growing vertical market for mobile robots, with revenues predicted to jump to $3 billion in 2022 from $300 million in 2017. Mobile robot use in the manufacturing sector is expected to soar as well, with revenues increasing 75 percent to more than $3 billion by 2022.
ROBOTS MOVE TO THE LOADING DOCK
Bastian's Ultra mobile robots for trailer loading and unloading are engineered for the narrow space and high reach of transport vehicles. They are being used in pilot programs this summer, with a full commercial rollout expected to start in the first quarter of 2019.
One of the newest areas for robotics is the loading dock, a place that's ripe for efficiency improvements and innovation, according to Joe Zoghzoghy, Ph.D., mobile robotics manager for material handling solutions provider Bastian Solutions. Bastian introduced its Ultra mobile robot for truck trailer loading and unloading at the Modex trade show in Atlanta this spring; the product is being used in pilot programs this summer, with a full commercial rollout expected to start in the first quarter of 2019.
Ultra robots are engineered for the narrow space and high reach of transport vehicles, ranging from extended vans to intermodal containers. The robots drive directly into the trailer, picking up as many as 20 cases per minute each, and can be integrated with a company's existing warehouse management and warehouse control systems. Zoghzoghy says this type of robotics solution directly addresses the many labor-related challenges companies face on the loading dock, including harsh temperatures and heavy lifting that leave workers prone to injury and raise a host of safety concerns, including repetitive stress injuries.
"It's hard to hire people for this type of environment," Zoghzoghy says. "It makes sense that organizations seek to solve some of these problems with automation."
Labor-related cost pressures are another concern. Increases in the minimum wage, overtime, and seasonal demands can strain budgets, giving organizations yet another reason to consider automating certain warehouse and distribution center tasks. A short payback period is crucial to making the math work on such investments, Zoghzoghy adds, noting that companies should expect a one- to two-year payback when implementing any automated or robotics solution.
As technology advances and costs come down, he says, more companies will be able to achieve that goal.
"In general, automation will be very helpful to improve efficiency, bring costs down, and create a safer environment for workers," Zoghzoghy says. "Especially as the cost of technology comes down, you'll see these solutions integrated even more."
With the new Trump Administration continuing to threaten steep tariffs on Mexico, Canada, and China as early as February 1, supply chain organizations preparing for that economic shock must be prepared to make strategic responses that go beyond either absorbing new costs or passing them on to customers, according to Gartner Inc.
But even as they face what would be the most significant tariff changes proposed in the past 50 years, some enterprises could use the potential market volatility to drive a competitive advantage against their rivals, the analyst group said.
Gartner experts said the risks of acting too early to proposed tariffs—and anticipated countermeasures by trading partners—are as acute as acting too late. Chief supply chain officers (CSCOs) should be projecting ahead to potential countermeasures, escalations and de-escalations as part of their current scenario planning activities.
“CSCOs who anticipate that current tariff volatility will persist for years, rather than months, should also recognize that their business operations will not emerge successful by remaining static or purely on the defensive,” Brian Whitlock, Senior Research Director in Gartner’s supply chain practice, said in a release.
“The long-term winners will reinvent or reinvigorate their business strategies, developing new capabilities that drive competitive advantage. In almost all cases, this will require material business investment and should be a focal point of current scenario planning,” Whitlock said.
Gartner listed five possible pathways for CSCOs and other leaders to consider when faced with new tariff policy changes:
Retire certain products: Tariff volatility will stress some specific products, or even organizations, to a breaking point, so some enterprises may have to accept that worsening geopolitical conditions should force the retirement of that product.
Renovate products to adjust: New tariffs could prompt renovations (adjustments) to products that were overdue, as businesses will need to take a hard look at the viability of raising or absorbing costs in a still price-sensitive environment.
Rebalance: Additional volatility should be factored into future demand planning, as early winners and losers from initial tariff policies must both be prepared for potential countermeasures, policy escalations and de-escalations, and competitor responses.
Reinvent: As tariff volatility persists, some companies should consider investing in new projects in markets that are not impacted or that align with new geopolitical incentives. Others may pivot and repurpose existing facilities to serve local markets.
Reinvigorate: Early winners of announced tariffs should seek opportunities to extend competitive advantages. For example, they could look to expand existing US-based or domestic manufacturing capacity or reposition themselves within the market by lowering their prices to take market share and drive business growth.
By the numbers, global logistics real estate rents declined by 5% last year as market conditions “normalized” after historic growth during the pandemic. After more than a decade overall of consistent growth, the change was driven by rising real estate vacancy rates up in most markets, Prologis said. The three causes for that condition included an influx of new building supply, coupled with positive but subdued demand, and uncertainty about conditions in the economic, financial market, and supply chain sectors.
Together, those factors triggered negative annual rent growth in the U.S. and Europe for the first time since the global financial crisis of 2007-2009, the “Prologis Rent Index Report” said. Still, that dip was smaller than pandemic-driven outperformance, so year-end 2024 market rents were 59% higher in the U.S. and 33% higher in Europe than year-end 2019.
Looking into coming months, Prologis expects moderate recovery in market rents in 2025 and stronger gains in 2026. That eventual recovery in market rents will require constrained supply, high replacement cost rents, and demand for Class A properties, Prologis said. In addition, a stronger demand resurgence—whether prompted by the need to navigate supply chain disruptions or meet the needs of end consumers—should put upward pressure on a broad range of locations and building types.
Fruit company McDougall & Sons is running a tighter ship these days, thanks to an automated material handling solution from systems integrator RH Brown, now a Bastian Solutions company.
McDougall is a fourth-generation, family-run business based in Wenatchee, Washington, that grows, processes, and distributes cherries, apples, and pears. Company leaders were facing a host of challenges during cherry season, so they turned to the integrator for a solution. As for what problems they were looking to solve with the project, the McDougall leaders had several specific goals in mind: They wanted to increase cherry processing rates, better manage capacity during peak times, balance production between two cherry lines, and improve the accuracy and speed of data collection and reporting on the processed cherries.
RH Brown/Bastian responded with a combination of hardware and software that is delivering on all fronts: The new system handles cartons twice as fast as McDougall’s previous system, with less need for manual labor and with greater accuracy. On top of that, the system’s warehouse control software (WCS) provides precise, efficient management of production lines as well as real-time insights, data analytics, and product traceability.
MAKING THE SWITCH
Cherry producers are faced with a short time window for processing the fruit: Once cherries are ripe, they have to be harvested and processed quickly. McDougall & Sons responds to this tight schedule by running two 10-hour shifts, seven days a week, for about 60 days nonstop during the season. Adding complexity, the fruit industry is shifting away from bulk cartons to smaller consumer packaging, such as small bags and clamshell containers. This has placed a heavier burden on the manual labor required for processing.
Committed to making its machinery and technology run efficiently, McDougall’s leaders decided they needed to replace the company’s simple motorized chain system with an automated material handling system that would speed and streamline its cherry processing operations. With that in mind, RH Brown/Bastian developed a solution that incorporates three key capabilities:
Advanced automation that streamlines carton movement, reducing manual labor. The system includes a combination of conveyors, switches, controls, in-line scales, and barcode imagers.
A WCS that allows the company to manage production lines precisely and efficiently, with real-time insights into processing operations.
Data and analytics capabilities that provide insight into the production process and allow quick decision-making.
BEARING FRUIT
The results of the project speak for themselves: The new system is moving cartons at twice the speed of the previous system, with 99.9% accuracy, according to both RH Brown/Bastian and McDougall & Sons.
But the transformational benefits didn’t end there. The companies also cite a 130% increase in throughput, along with the ability to process an average of 100 cases per minute on each production line.
Artificial intelligence (AI) and the economy were hot topics on the opening day of SMC3 Jump Start 25, a less-than-truckload (LTL)-focused supply chain event taking place in Atlanta this week. The three-day event kicked off Monday morning to record attendance, with more than 700 people registered, according to conference planners.
The event opened with a keynote presentation from AI futurist Zack Kass, former head of go to market for OpenAI. He talked about the evolution of AI as well as real-world applications of the technology, furthering his mission to demystify AI and make it accessible and understandable to people everywhere. Kass is a speaker and consultant who works with businesses and governments around the world.
The opening day also featured a slate of economic presentations, including a global economic outlook from Dr. Jeff Rosensweig, director of the John Robson Program for Business, Public Policy, and Government at Emory University, and a “State of LTL” report from economist Keith Prather, managing director of Armada Corporate Intelligence. Both speakers pointed to a strong economy as 2025 gets underway, emphasizing overall economic optimism and strong momentum in LTL markets.
Other highlights included interviews with industry leaders Chris Jamroz and Rick DiMaio. Jamroz is executive chairman of the board and CEO of Roadrunner Transportation Systems, and DiMaio is executive vice president of supply chain for Ace Hardware.
Jump Start 25 runs through Wednesday, January 29, at the Renaissance Atlanta Waverly Hotel & Convention Center.
The new cranes are part of the latest upgrades to the Port of Savannah’s Ocean Terminal, which is currently in a renovation phase, although freight operations have continued throughout the work. Another one of those upgrades is a $29 million exit ramp running from the terminal directly to local highways, allowing trucks direct highway transit to Atlanta without any traffic lights until entering Atlanta. The ramp project is 60% complete and is designed with the local community in mind to keep container trucks off local neighborhood roads.
"The completion of this project in 2028 will enable Ocean Terminal to accommodate the largest vessels serving the U.S. East Coast," Ed McCarthy, Chief Operating Officer of Georgia Ports, said in a release. "Our goal is to ensure customers have the future berth capacity for their larger vessels’ first port of calls with the fastest U.S. inland connectivity to compete in world markets."
"We want our ocean carrier customers to see us as the port they can bring their ships and make up valuable time in their sailing schedule using our big ship berths. Our crane productivity and 24-hour rail transit to inland markets is industry-leading," Susan Gardner, Vice President of Operations at Georgia Ports, said.