Warehouse robots provide shields against cyberthreats
As warehouses go increasingly digital, they also become more vulnerable to hackers. But makers of autonomous mobile warehouse robots say they’ve got that covered, citing the multilayered security protocols built into their systems.
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
A quick look at business headlines shows that cyberthreats are one of the top challenges confronting American companies. From ransomware to customer-data leaks and intellectual property theft, hackers seem to be lurking around every corner, and they’re not sparing logistics operators.
Big names that have reportedly fended off cyberattacks in the past year include the Seattle-based freight forwarder Expeditors, German shipping group Hapag-Lloyd, Indian container handling facility the Jawaharlal Nehru Port Container Terminal (JNPCT), and German customs broker Hellmann Worldwide Logistics. The rise in cybercrime even led the White House this spring to advise companies to boost their defenses against cyberthreats and prompted the U.S. Customs and Border Protection agency to warn that such attacks could threaten critical supply chain operations in particular.
But amid the push to ward off hackers, there’s one sector that is seldom mentioned: the humble warehouse. That omission is partly a product of outdated thinking. For decades, most warehouses were simply large buildings filled to the rafters with inventory—and with very few computers to attack. But that all changed with the advent of warehouse automation. Today’s distribution center is more likely to be a humming hive of robots and other automated equipment, all connected wirelessly to warehouse management systems (WMS) and other software that could potentially be exploited by hackers.
Given these vulnerabilities, it’s no surprise that developers of automated logistics equipment are also adding “armor” to protect their technology from these threats. But adding armor is just the half of it. There are also things warehouse leaders can do to protect their data, these developers say. And the protective measures don’t have to be complicated, they add, noting that simply following some basic security principles can reduce an operation’s exposure to cyberattacks and help safeguard its customers’ data.
SAFE AND SECURE
The first wall of defense for warehouse automation systems such as autonomous mobile robots (AMRs) is having them operate within the building’s own intranet, says Nathan Cao, head of technical services for Geek +, a developer of warehouse robots and artificial intelligence (AI) products.
Although the types of devices being connected to these intranets have evolved over time, companies have successfully protected their intranets for years through industry-standard approaches such as ISO/IEC 27001, Cao says. That standard offers a set of information security management protocols defined by the International Organization for Standardization (ISO) to protect assets such as financial information, intellectual property, employee details, and information entrusted to them by third parties.
Those same industry standards are also key to protecting communications outside the building, like the data exchanged between automated equipment and various cloud platforms, says Akash Gupta, CTO and co-founder of GreyOrange Pte Ltd., another developer of AMRs and order fulfillment optimization products.
In GreyOrange’s case, the company’s cloud-based GreyMatter fulfillment optimization software exchanges data with each client’s own cloud-based platforms, such as an enterprise resource planning (ERP) or order management system. That connection happens through application programming interfaces (APIs) that are secured with industry-standard processes, Gupta says.
The GreyMatter system then hands down instructions to individual robots in the warehouses, but it sends them only relevant data like bin locations and picking sequences, instead of sensitive data such as customer names, addresses, or financial information.
6 River Systems, another provider of AMRs and fulfillment software, takes a similar approach with its “Chuck” model robots, which work collaboratively with human order pickers to optimize fulfillment operations. Those robots are designed to strictly limit the information they can exchange, the company says.
“We don’t want customer information at 6 River Systems; we only want the data to empower Chuck to path-plan, pick an item, and confirm,” says Gillan Hawkes, 6 River’s vice president of product and analytics. “It’s just metadata, like weight, dimension, and shelf location, not end-user information like a delivery address.”
To obtain that information, the 6 River robots communicate with cloud-based servers through the same hypertext transfer protocol secure (https) system that many people use for secure communication over computer networks while browsing the internet. They further protect their communication outside the building by using APIs with “encrypted tunnels,” the company says.
FINDING SAFETY IN LAYERS
Deploying these multiple layers of cyberdefenses is critical, according to Berkshire Grey, another developer of robotic order fulfillment solutions. The company says that relying on a customer’s corporate intranet alone is no guarantee of overall security, since intruders typically attempt to “punch holes” in these security systems through the very mechanisms—wireless networks and cloud connections—that enable warehouse robots to do their jobs.
For that reason, BerkshireGrey follows the same approach used by its fellow vendors, choosing to exchange only minimal, non-sensitive information with cloud platforms, says Pras Velagapudi, the company’s director of engineering. And it follows a redundant approach to security by building in multiple layers of protection.
“The best defense is one that puts up a fight even if [only a single] layer is compromised,” Velagapudi says. “We employ a multilayer approach to security: restrict information, restrict access, and encrypt data. This ensures that it is not only difficult to compromise the system, but also that if a component gets compromised, it is difficult to use that to get to sensitive information or exploit any other part of the system.”
The task of cyberdefense has never been more important than it is today, as the logistics sector adds new technology to every operation and as global unrest triggers an increase in attacks. A recent report by the cybersecurity service provider Trellix found an increase in cyber activity targeting critical infrastructure sectors during the fourth quarter of 2021, with 27% of those threats targeting transportation and shipping companies.
But suppliers of automated warehouse equipment say they are up to the challenge, applying both information technology (IT) industry standards and specific logistics-focused strategies to fend off attacks and keep fulfillment operations rolling.
As a contract provider of warehousing, logistics, and supply chain solutions, Geodis often has to provide customized services for clients.
That was the case recently when one of its customers asked Geodis to up its inventory monitoring game—specifically, to begin conducting quarterly cycle counts of the goods it stored at a Geodis site. Trouble was, performing more frequent counts would be something of a burden for the facility, which still conducted inventory counts manually—a process that was tedious and, depending on what else the team needed to accomplish, sometimes required overtime.
So Levallois, France-based Geodis launched a search for a technology solution that would both meet the customer’s demand and make its inventory monitoring more efficient overall, hoping to save time, labor, and money in the process.
SCAN AND DELIVER
Geodis found a solution with Gather AI, a Pittsburgh-based firm that automates inventory monitoring by deploying small drones to fly through a warehouse autonomously scanning pallets and cases. The system’s machine learning (ML) algorithm analyzes the resulting inventory pictures to identify barcodes, lot codes, text, and expiration dates; count boxes; and estimate occupancy, gathering information that warehouse operators need and comparing it with what’s in the warehouse management system (WMS).
Among other benefits, this means employees no longer have to spend long hours doing manual inventory counts with order-picker forklifts. On top of that, the warehouse manager is able to view inventory data in real time from a web dashboard and identify and address inventory exceptions.
But perhaps the biggest benefit of all is the speed at which it all happens. Gather AI’s drones perform those scans up to 15 times faster than traditional methods, the company says. To that point, it notes that before the drones were deployed at the Geodis site, four manual counters could complete approximately 800 counts in a day. By contrast, the drones are able to scan 1,200 locations per day.
FLEXIBLE FLYERS
Although Geodis had a number of options when it came to tech vendors, there were a couple of factors that tipped the odds in Gather AI’s favor, the partners said. One was its close cultural fit with Geodis. “Probably most important during that vetting process was understanding the cultural fit between Geodis and that vendor. We truly wanted to form a relationship with the company we selected,” Geodis Senior Director of Innovation Andy Johnston said in a release.
Speaking to this cultural fit, Johnston added, “Gather AI understood our business, our challenges, and the course of business throughout our day. They trained our personnel to get them comfortable with the technology and provided them with a tool that would truly make their job easier. This is pretty advanced technology, but the Gather AI user interface allowed our staff to see inventory variances intuitively, and they picked it up quickly. This shows me that Gather AI understood what we needed.”
Another factor in Gather AI’s favor was the prospect of a quick and easy deployment: Because the drones can conduct their missions without GPS or Wi-Fi, the supplier would be able to get its solution up and running quickly. In the words of Geodis Industrial Engineer Trent McDermott, “The Gather AI implementation process was efficient. There were no IT infrastructure or layout changes needed, and Gather AI was flexible with the installation to not disrupt peak hours for the operations team.”
QUICK RESULTS
Once the drones were in the air, Geodis saw immediate improvements in cycle counting speed, according to Gather AI. But that wasn’t the only benefit: Geodis was also able to more easily find misplaced pallets.
“Previously, we would research the inventory’s systemic license plate number (LPN),” McDermott explained. “We could narrow it down to a portion or a section of the warehouse where we thought that LPN was, but there was still a lot of ambiguity. So we would send an operator out on a mission to go hunt and find that LPN,” a process that could take a day or two to complete. But the days of scouring the facility for lost pallets are over. With Gather AI, the team can simply search in the dashboard to find the last location where the pallet was scanned.
And about that customer who wanted more frequent inventory counts? Geodis reports that it completed its first quarterly count for the client in half the time it had previously taken, with no overtime needed. “It’s a huge win for us to trim that time down,” McDermott said. “Just two weeks into the new quarter, we were able to have 40% of the warehouse completed.”
The less-than-truckload (LTL) industry moved closer to a revamped freight classification system this week, as the National Motor Freight Traffic Association (NMFTA) continued to spread the word about upcoming changes to the way it helps shippers and carriers determine delivery rates. The NMFTA will publish proposed changes to its National Motor Freight Classification (NMFC) system Thursday, a transition announced last year, and that the organization has termed its “classification reimagination” process.
Businesses throughout the LTL industry will be affected by the changes, as the NMFC is a tool for setting prices that is used daily by transportation providers, trucking fleets, third party logistics service providers (3PLs), and freight brokers.
Representatives from NMFTA were on hand to discuss the changes at the LTL-focused supply chain conference Jump Start 25 in Atlanta this week. The project’s goal is to make what is currently a complex freight classification system easier to understand and “to make the logistics process as frictionless as possible,” NMFTA’s Director of Operations Keith Peterson told attendees during a presentation about the project.
The changes seek to simplify classification by grouping similar items together and assigning most classes based solely on density. Exceptions will be handled separately, adding other characteristics when density alone is not enough to determine an accurate class.
When the updates take effect later this year, shippers may see shifts in the LTL prices they pay to move freight—because the way their freight is classified, and subsequently billed, could change as a result.
NMFTA will publish the proposed changes this Thursday, January 30, in a document called Docket 2025-1. The docket will include more than 90 proposed changes and is open to industry feedback through February 25. NMFTA will follow with a public meeting to review and discuss feedback on March 3. The changes will take effect July 19.
NMFTA has a dedicated website detailing the changes, where industry stakeholders can register to receive bi-weekly updates: https://info.nmfta.org/2025-nmfc-changes.
Trade and transportation groups are congratulating Sean Duffy today for winning confirmation in a U.S. Senate vote to become the country’s next Secretary of Transportation.
Once he’s sworn in, Duffy will become the nation’s 20th person to hold that post, succeeding the recently departed Pete Buttigieg.
Transportation groups quickly called on Duffy to work on continuing the burst of long-overdue infrastructure spending that was a hallmark of the Biden Administration’s passing of the bipartisan infrastructure law, known formally as the Infrastructure Investment and Jobs Act (IIJA).
But according to industry associations such as the Coalition for America’s Gateways and Trade Corridors (CAGTC), federal spending is critical for funding large freight projects that sustain U.S. supply chains. “[Duffy] will direct the Department at an important time, implementing the remaining two years of the Infrastructure Investment and Jobs Act, and charting a course for the next surface transportation reauthorization,” CAGTC Executive Director Elaine Nessle said in a release. “During his confirmation hearing, Secretary Duffy shared the new Administration’s goal to invest in large, durable projects that connect the nation and commerce. CAGTC shares this goal and is eager to work with Secretary Duffy to ensure that nationally and regionally significant freight projects are advanced swiftly and funded robustly.”
A similar message came from the International Foodservice Distributors Association (IFDA). “A safe, efficient, and reliable transportation network is essential to our industry, enabling 33 million cases of food and related products to reach professional kitchens every day. We look forward to working with Secretary Duffy to strengthen America’s transportation infrastructure and workforce to support the safe and seamless movement of ingredients that make meals away from home possible,” IFDA President and CEO Mark S. Allen said in a release.
And the truck drivers’ group the Owner-Operator Independent Drivers Association (OOIDA) likewise called for continued investment in projects like creating new parking spaces for Class 8 trucks. “OOIDA and the 150,000 small business truckers we represent congratulate Secretary Sean Duffy on his confirmation to lead the U.S. Department of Transportation,” OOIDA President Todd Spencer said in a release. “We look forward to continue working with him in advancing the priorities of small business truckers across America, including expanding truck parking, fighting freight fraud, and rolling back burdensome, unnecessary regulations.”
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.