Advances in robotic piece-picking technology are driving its adoption in the DC and attracting investor interest, thanks to e-commerce growth and soaring demand for more warehouses.
Victoria Kickham, an editor at large for Supply Chain Quarterly, 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 Supply Chain Quarterly's sister publication, DC Velocity.
Piece-picking robots are finding their way into more warehouses and distribution centers (DCs) these days thanks to steady improvements in the technology that are making it more attractive to a wider range of end-users. Advances in gripping technology and arm speed are making it easier to handle a broader array of items, for example, allowing companies to maximize their investment and reduce their reliance on human labor for mundane picking tasks.
The trend is part of a growing demand for industrial robots in general—a trend that is only expected to gather steam as fulfillment operations deal with rising e-commerce volumes and the labor challenges that accompany such growth. The Association for Advancing Automation (A3) tracked a 28% increase in North American robot sales last year compared to 2020; it was the strongest sales year on record, with $2 billion worth of robot units sold. Separate industry statistics valued the piece-picking robot market at more than $148 million in 2020, a figure that’s expected to surpass $3 billion by 2026, a nearly 63% compound annual growth rate.
The growth is spurring interest from the investment community as well. Earlier this year, robotic picking solutions developer RightHand Roboticslanded $66 million in venture capital funding, which the company said it will use to accelerate the development of its RightPick piece-picking solution. There’s been a steady stream of similar announcements regarding robotics-industry investments over the past year, which underscores the bullish market outlook for the technology.
“We foresee strong growth in this area,” explains A3’s President Jeff Burnstein, emphasizing e-commerce growth and a related demand to build more warehouses and DCs—all of which will need automation. “That means this segment will grow, and there will be innovation. There is a lot of venture capital [flowing] into this space as well, which shows you this will be a very aggressive market moving forward.”
Some of the most common logistics applications for piece-picking robots today are sortation and pick-and-place functions in general merchandise, apparel, and small-package operations, but experts say the opportunities are growing just as fast as the demand.
GETTING BETTER OVER TIME
There have been “massive improvements” in piece-picking technology over the past few years, according to Jake Heldenberg, senior manager for warehouse solutions sales consulting at material handling systems integrator Vanderlande. Piece-picking robots use a gripper attached to a mechanical arm for item picking and are most commonly used to pick single items from a source bin and deposit them into an outbound container. Heldenberg says grippers are able to manipulate and grasp far more items than they could just a few years ago and that arm speed has improved as well, allowing companies across many industries to meet productivity improvement goals.
“Four years ago, [robotic piece-picking solutions] could handle 60% to 70% of SKUs [stock-keeping units]. Now, they can handle 90%-plus for picking in general merchandise and fashion,” Heldenberg says. “The most successful products have been cosmetics—because they come in small boxes that are lightweight and easy to grip.”
The biggest challenge has been the robot’s vision system, but that technology is improving as well. Piece-picking robots incorporate three-dimensional (3D) cameras and software to “see” what they are doing. Robot developers are working to improve vision systems so that robots can more easily identify items of different shapes, sizes, and weights. Artificial intelligence (AI) and machine learning (ML) can help with this process by allowing the robot to “learn” and improve on its own.
“Maybe the robot is being told to pick object ‘X’ out of a bin of various objects. To do that, it has to identify object ‘X,’” Burnstein explains, adding that understanding the item’s dimensions and weight are a crucial part of that process. “Robots can learn how to do this more effectively over time through AI and machine learning.”
Vince Martinelli, head of product and marketing at RightHand Robotics, explains that AI gives the robot the cognitive skills and “understanding” of its space that allow it to function more accurately and consistently in a complex environment. He says today’s piece-picking robots are more adaptable, reliable, and faster than ever before—thanks to advances in AI, but also because developers are gaining real-world experience as their products become more widely used. Real-world applications can reveal obstacles, errors, and scenarios in which a robot may not complete a task perfectly, for instance. Developers can then use that experience to further refine the technology’s capabilities.
“Some things are hard to do in a lab,” Martinelli says. “We can’t pre-imagine every scenario. If something isn’t perfect, how do you resolve that in the field? Learning how to collect, collate, and process the data coming from the machines [helps us] relentlessly drive overall reliability and performance.”
REALIZING SUCCESS IN THE FIELD
Piece-picking technology is becoming an increasingly important part of the automation mix for parcel carrier and logistics services provider FedEx, according to Aaron Prather, senior adviser for the company’s technology research and planning team. The company uses piece-picking robots for sortation and pick-and-place operations at facilities around the world, and plans to use them for even more applications at both new and existing facilities—thanks in large part to technology advances that have spurred creativity throughout the organization. Over the past five years, the company’s FedEx Ground business has added more than 60 automated stations to its network, with nearly 150 fully automated facilities in the ground network, which affect more than 97% of package volume.
“Right now, the technology is good at picking up small packages and placing them on a [conveyor] belt to go into the system,” Prather says, explaining that robots are replacing humans at drop-off facilities and larger FedEx warehouses where parcels and small packages are sorted, scanned, and sent on to their next destination. “But each day, we’re looking at doing something else [with the technology]. There is a lot of growth in this area. There’s nowhere to go but up.”
Prather says next steps for robotic piece picking include unloading trucks—another pick-and-place application where the company could free up human labor for other activities. The idea is to apply the technology at warehouses and DCs in the network as well as at airfreight facilities, where parcels and packages must be unloaded from large containers.
“That is the next big type of application a lot of us are going after,” Prather says, adding that the robots would pick parcels and then place them on a conveyor belt or possibly an autonomous mobile robot (AMR). “If you’re in logistics, that’s something you want to solve—it’s a labor-intense activity, so it’s something that everyone wants to automate.
“There are so many interesting use cases coming up now, because the technology is getting so much better.”
He says the technology is also spurring a workforce evolution that is creating higher-level career opportunities throughout the organization. FedEx’s new “robot team leader” positions are a case in point. These are hourly jobs in which an employee oversees a group of robots and is trained to manage, monitor, troubleshoot, and address any maintenance issues that may arise.
“Some are watching a bunch of [robotic] arms; others are watching a bunch of mobile robots. They are trained on robot support,” Prather explains, emphasizing the importance of the position as well as a growing interest in it among employees. “All of them love their jobs. They get to go home and tell their kids they work with robots. But we can’t create more robot team leaders until we put more robots in.”
And that’s in the works. Most recently, FedEx installed a sorting robot at a FedEx Express facility in China that handles small inbound and outbound packages for e-commerce customers in the southern part of the country. The project followed similar sortation solutions implemented here at home last year. One example is the implementation of robot developer Berkshire Grey’s Robotic Product Sortation and Identification (RPSi) system at FedEx Ground facilities in New York, Las Vegas, and Ohio. The AI-based system autonomously picks, identifies, sorts, and collects small packages that were previously sorted by hand.
That kind of innovation will only continue, he says.
“We know going forward that our greenfield sites will have automation. We’ll design sites with this technology in mind,” Prather says. “However, it is still critical for the industry to understand there are a lot of brownfield sites we are not going to give up on. Our volume continues to grow, people are shipping like crazy, so we are still going to look at ways to automate those sites as well. The challenge will be how do we take these technologies and fit them into these brownfield sites? That’s where our creativity is going to kick in.”
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.
That challenge is one of the reasons that fewer shoppers overall are satisfied with their shopping experiences lately, Lincolnshire, Illinois-based Zebra said in its “17th Annual Global Shopper Study.”th Annual Global Shopper Study.” While 85% of shoppers last year were satisfied with both the in-store and online experiences, only 81% in 2024 are satisfied with the in-store experience and just 79% with online shopping.
In response, most retailers (78%) say they are investing in technology tools that can help both frontline workers and those watching operations from behind the scenes to minimize theft and loss, Zebra said.
Just 38% of retailers currently use AI-based prescriptive analytics for loss prevention, but a much larger 50% say they plan to use it in the next 1-3 years. That was followed by self-checkout cameras and sensors (45%), computer vision (46%), and RFID tags and readers (42%) that are planned for use within the next three years, specifically for loss prevention.
Those strategies could help improve the brick and mortar shopping experience, since 78% of shoppers say it’s annoying when products are locked up or secured within cases. Adding to that frustration is that it’s hard to find an associate while shopping in stores these days, according to 70% of consumers. In response, some just walk out; one in five shoppers has left a store without getting what they needed because a retail associate wasn’t available to help, an increase over the past two years.
The survey also identified additional frustrations faced by retailers and associates:
challenges with offering easy options for click-and-collect or returns, despite high shopper demand for them
the struggle to confirm current inventory and pricing
lingering labor shortages and increasing loss incidents, even as shoppers return to stores
“Many retailers are laying the groundwork to build a modern store experience,” Matt Guiste, Global Retail Technology Strategist, Zebra Technologies, said in a release. “They are investing in mobile and intelligent automation technologies to help inform operational decisions and enable associates to do the things that keep shoppers happy.”
The survey was administered online by Azure Knowledge Corporation and included 4,200 adult shoppers (age 18+), decision-makers, and associates, who replied to questions about the topics of shopper experience, device and technology usage, and delivery and fulfillment in store and online.
Supply chains are poised for accelerated adoption of mobile robots and drones as those technologies mature and companies focus on implementing artificial intelligence (AI) and automation across their logistics operations.
That’s according to data from Gartner’s Hype Cycle for Mobile Robots and Drones, released this week. The report shows that several mobile robotics technologies will mature over the next two to five years, and also identifies breakthrough and rising technologies set to have an impact further out.
Gartner’s Hype Cycle is a graphical depiction of a common pattern that arises with each new technology or innovation through five phases of maturity and adoption. Chief supply chain officers can use the research to find robotic solutions that meet their needs, according to Gartner.
Gartner, Inc.
The mobile robotic technologies set to mature over the next two to five years are: collaborative in-aisle picking robots, light-cargo delivery robots, autonomous mobile robots (AMRs) for transport, mobile robotic goods-to-person systems, and robotic cube storage systems.
“As organizations look to further improve logistic operations, support automation and augment humans in various jobs, supply chain leaders have turned to mobile robots to support their strategy,” Dwight Klappich, VP analyst and Gartner fellow with the Gartner Supply Chain practice, said in a statement announcing the findings. “Mobile robots are continuing to evolve, becoming more powerful and practical, thus paving the way for continued technology innovation.”
Technologies that are on the rise include autonomous data collection and inspection technologies, which are expected to deliver benefits over the next five to 10 years. These include solutions like indoor-flying drones, which utilize AI-enabled vision or RFID to help with time-consuming inventory management, inspection, and surveillance tasks. The technology can also alleviate safety concerns that arise in warehouses, such as workers counting inventory in hard-to-reach places.
“Automating labor-intensive tasks can provide notable benefits,” Klappich said. “With AI capabilities increasingly embedded in mobile robots and drones, the potential to function unaided and adapt to environments will make it possible to support a growing number of use cases.”
Humanoid robots—which resemble the human body in shape—are among the technologies in the breakthrough stage, meaning that they are expected to have a transformational effect on supply chains, but their mainstream adoption could take 10 years or more.
“For supply chains with high-volume and predictable processes, humanoid robots have the potential to enhance or supplement the supply chain workforce,” Klappich also said. “However, while the pace of innovation is encouraging, the industry is years away from general-purpose humanoid robots being used in more complex retail and industrial environments.”
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”