E-commerce has changed the way just about every warehouse or distribution facility fills orders, but for Toronto-based publisher Scholastic Canada, the need to accommodate online ordering and other market shifts has sparked a sea change in its approach to warehouse automation. The Canadian arm of Scholastic, the more than 100-year-old multinational publisher of children’s books and educational media, the company has boosted productivity and reduced costs in its schools-based business since replacing an infrastructure-heavy automated warehouse system with a subscription-based mobile robotics solution that can adapt to shifting market demands. The system’s flexibility and its subscription-based pricing model are just what the company needed to address those changes and give operations managers the freedom to grow in a tough economy.
“The ability to lift and shift was crucial for us. We needed a system that we could easily move to a new facility,” explains Chad MacGillivray, Scholastic Canada’s vice president of distribution operations. He emphasizes rising industrial rents and the risks of investing in high-priced equipment in a fast-changing technology environment. “We didn’t want to invest a lot of [capital] to own anything that could become obsolete while it was still depreciating on our books.”
Thus the change in strategy. Scholastic Canada decided to partner with robotics-as-a-service (RaaS) provider inVia Robotics to develop a system that could accommodate the company’s growing need to fill orders from a wider range of inventory as customers gravitated to online shopping. The system pairs inVia’s warehouse automation software with autonomous mobile robots (AMRs) at Scholastic’s Markham, Ontario, distribution center (DC), just outside Toronto. The partners started by automating the facility’s picking process and then branched out to replenishment and cycle counting. The system went live about a year ago, and now the partners are expanding it to other business units in the DC—and preparing to “lift and shift” to a new facility next year.
As MacGillivray explains: “This, for us, was phase one—and it was really just the beginning.”
FROM FLYERS TO WEBSITES
Scholastic Canada’s business was steadily changing as e-commerce took hold, but the 2020 pandemic shifted things into high gear. Its schools-based business has long been rooted in book fairs and those familiar paper flyers delivered to classrooms. But when schools closed and switched to online instruction, the company’s order profile quickly changed. Instead of sending one large box to a classroom, the facility was filling 10 or 12 smaller boxes and delivering them to residential addresses, for instance. What’s more, online ordering gave customers access to a much broader range of stock-keeping units (SKUs), essentially allowing them to order from the full breadth of Scholastic Canada’s inventory, which can reach nearly 10,000 SKUs during peak season. The facility’s existing fulfillment solution included a traditional automated storage and retrieval system (AS/RS) and a network of conveyors that could divert items to various pick areas, where associates used pick-to-light or voice technology to fill orders. But as business needs shifted, the system couldn’t keep up with demand.
“Our previous system served us really well in the school market for a long time. We could build a zone, the conveyor would divert [boxes] to that zone, and [associates] could pick the order right there,” explains MacGillivray. “As we moved into e-commerce and online ordering, customers were ordering from the whole breadth of SKUs. Our pick area kept expanding, the walk area was larger, and it took longer to pick orders. We were looking for a solution [that would] reduce the walking and make it easier for us to pick the orders in a more dense way.”
They were also looking to reduce their reliance on warehouse labor, which was getting increasingly costly and difficult to find in the Toronto area—especially during peak shipping season. On top of that, rising real estate costs argued for a flexible system that would be easy to move if necessary.
KEEPING THE TRAFFIC FLOWING
InVia’s RaaS solution was the answer, and picking was the logical place to begin. As a first step, inVia reconfigured Scholastic Canada’s fulfillment workflows and created a digital twin of the facility to test them. Next, it implemented its inVia Logic warehouse automation software, an AI (artificial intelligence)-driven warehouse execution system (WES) that analyzes daily service-level agreements (SLAs) and builds a plan to execute and synchronize all fulfillment tasks to meet those needs. Essentially, the software orchestrates all of the resources in the facility so that orders are filled quickly and accurately.
The idea is to find the most efficient way to get orders out the door in an increasingly complex fulfillment landscape, explains inVia’s CEO, Lior Elazary.
“We offer a complete software suite that helps you manage resources inside the warehouse—forklift drivers, pickers, and pack out,” he explains. “[The system tells those resources] what to do, when to do it, and where inventory should be located.
“The warehouse is a huge traffic management problem,” he adds. “If you don’t do it right, it just jams up.”
InVia’s AMRs help keep the traffic flowing: All orders move from Scholastic Canada’s warehouse management software system (WMS) to inVia’s WES, which determines the orders to pick and when to pick them. The AMRs then take over, retrieving products from a designated set of storage shelves known as the “robotic grid.” Guided by a vision system and equipped with a shelf, a scissor lift that extends eight and a half feet high, and suction cups for gripping, the AMRs travel through the grid, grabbing the appropriate containers from the shelves and delivering them to inVia’s “Picker Wall,” a two-sided, dynamic pick/put wall. Associates take it from there, picking items from the wall to fill the day’s orders.
Elazary explains that the system optimizes both the robotic and human labor in the warehouse: The robots work nonstop overnight or early in the morning, stocking the PickerWall—which is essentially a long, open shelf—with containers of products needed for the day’s orders. Associates work on the other side of the wall, picking from the containers and depositing items for orders into designated boxes—all from a fixed location, and with the ability to take a break or shift to other tasks without holding up the fulfillment process. The strategy eliminates the friction that can occur when robots and humans interact, Elazary says.
“The system is already preparing the wall with all the containers the person has to pick from. So pickers come in and they’re not running around—and they’re not waiting on the robots,” he says. “We built this buffer to help alleviate that kind of contention.”
Elazary says the result is a faster, smoother-running system. And the results at the Markham DC back that up. From February 2023 through this past holiday peak season, MacGillivray says the facility experienced no sustained downtime—a feat that stands in stark contrast to a year earlier.
“In our [2022] peak, we had a total of 27 hours of sustained downtime,” he says. “That’s a lot of units you didn’t ship when you should have.”
InVia’s AMRs travel to other areas of the warehouse as well, delivering items to replenishment or discarding empty boxes. And they work within Scholastic Canada’s existing system—there was no special shelving or other infrastructure required to make the system work. The setup has allowed Scholastic Canada to double its pick rates using existing floor space and without having to add labor.
“We saw this as an opportunity to offset the challenge of finding people to hire,” explains MacGillivray. “It’s a natural effect of a more efficient system, [and we have] reduced our headcount through attrition more than anything else.”
FROM STATIC TO DYNAMIC
Scholastic Canada and inVia moved to phase two of their partnership last fall, extending the robotic fulfillment process to the facility’s trade business, which serves large retailers like Amazon, Canadian bookseller Indigo, and Walmart. The flexibility of the system and the freedom of the subscription-based model were the primary drivers behind the expansion, according to MacGillivray.
“I beat the drum over and over about [the value] of not owning anything right now,” he says, adding that the inVia partnership is not the only one through which the Markham DC is leasing equipment or AI-based software used in the building. “The technology is moving too fast. Not owning anything right now is really smart for operations leaders. You need to make sure you generate projects that you can shift and move to other areas as the technology [changes].”
Elazary agrees, explaining that inVia’s model includes continual upgrades and enhancements to both the software and hardware. Beyond that, inVia continuously optimizes the robots to integrate with each facility’s fulfillment processes. Pricing is based on the productivity of the entire system, rather than the number of units deployed. For instance, Scholastic Canada’s monthly subscription fee is based on the number of actions per hour (APH) the robots perform in order to meet the facility’s throughput needs.
“Our customers care about productivity, so we’re constantly upgrading the robots and the software,” Elazary says. “If we make [the robots] faster, it helps everybody. We are a robotics company. We know how to optimize the equipment. That, in a sense, is what our software does.”
Leaders at Scholastic Canada are preparing to put the system’s flexibility to the test in the year ahead with a move to a newly built facility in the Toronto area. MacGillivray says he expects to begin shipping orders from the new DC sometime in 2025—adding that it’s time to “take the lift-and-shift portion of this project and put it to work.”
