Robotics are expected to change logistics industry in year 2020 & beyond. By the end of 2018 , around 40% of 200 leading e-commerce and Omni-Channel companies have deployed robotics systems in their “Order Fulfilment, Warehousing and Delivery Operations”. Currently the Logistics Robots Market Size is around $4.00 billion. Whereas the Market Growth 21.0%. By 2026, Logistics Robots Market would reach up to $18.58 billion.
Few years ago Amazon’s acquisition of Kiva Systems robotics (re-named as Amazon Robotics), has transformed the whole robotic logistics scenario. Amazon is using Robots in logistics and other functions in warehouses such as packing and picking. Further, we may see, as we are now in manufacturing, the rise of cobots, or collaborative robots, as coined by Rethink Robotics. The market is ready for the use of logistics robots to work in conjunction with the Industrial Internet of Things (IIoT), also known as industry 4.0. Cobots are involved in packaging, picking, shipping, delivery and visibility throughout logistics, but they are rapidly becoming key players in the artificial intelligence and data analytics movement.
By the end of this year, up to 30% of all new robotic deployments will use robots that operate three times faster than existing robots deployed at the end of 2016. In other words, more robotic systems will be used for order fulfillment warehousing and delivery operations by up to 45% of mainstream global e-commerce and omni-channel commerce companies.
The demand for faster last-mile delivery is causing some major problems for shippers trying to implement in-house last mile programs. For many retailers, this will be difficult, requiring significant investment in two fleets, drivers, technology and additional resources to handle last-mile delivery.
However, last-mile delivery is not exclusive to home delivery, and it can include delivery to store. Ergo, ship-to-store and pick up at a store are last mile delivery options, and shippers can leverage existing brick-and-mortar stores to offer faster delivery to consumers. As a result, stores as a distribution center will become more popular throughout 2019.
Autonomous trucks and drones are the 800-pound gorilla in logistics technology trends. They are the in-all solution to the concerns over the driver shortage, and they can save big bucks for logistics service providers. Unfortunately, self-driving trucks and cars are not yet widely available. Even when they can perform as their name implies, chances are good that regulatory agencies will act. This will result in added costs of using driverless vehicles, changes to insurance premiums and more.
Another side of the equation is labor; people are clamoring over the possibility of robotics, including driverless vehicles and tries, taking the place of human jobs. Although it might sound like a doomsday scenario, it is not a robot apocalypse. Driverless technology has a long way to go before it can be deployed on a nationwide scale, and 2019 will see more logistics service providers realizing the potential drawbacks to investing too much in autonomous delivery options right now. This also includes drone delivery. Instead, they will focus more on existing technologies and explore autonomous delivery with caution.
Increasing emphasis on end-to-end automation for operational efficiency and issues pertaining to labor availability is estimated to stimulate market demand. Increasing necessity for more workers to handle logistics operations is driving the growth of e-commerce industries and the requirement for more package shipments. Also, a reduction in the size of the available workforce owing to shrinking population levels in the western countries is directly affecting the need for logistics workforce as online retail normally needs more workers per item sold as compared to traditional brick-and-mortar retail. Moreover, the increase in the average weight of such shipments as consumers are ordering large items like white goods, building supplies, and furniture, among other products, is necessitating the demand for robots. In Alibaba warehouses, robots perform 70% of the work, and in Ocado’s facilities in the UK, robots can be observed navigating a futuristic giant chessboard grid, storing and retrieving grocery items.
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In the Spring of 2017, DHL Supply Chain, announced that its starting a pilot with the LocusBots™ cobots (Collaborative Robots). The company is conducting the pilot within the life sciences sector at a facility in Tennessee, USA. If the pilot, for which several different picking strategies will be tried and the ability of the robots will be assessed in regards with communication with the picker and with the warehouse management system, it’s expected that a further roll-out will take place. And definitely cobots market is about to accelerate at a higher pace. The void left by Amazon is being filled in by various players such as Locus Robotics and, among others due to lowering costs, clear benefits and evolutions in the used technologies and practices to ensure safe human and robot collaboration, the real ‘robot wars’ are about to start with more vendors getting ready. Indeed other factors like evolutions in e-commerce are obviously also contributing to this.
The Logistics 2050 scenario study would impact the logistics business and also a strategic exercise. Therefore only those who think about alternatives can devise robust strategies. Such scenario studies, involving several experts and stakeholders and following a clear methodology can be great ways to look at the future potential business scenarios. Though we cannot predict future but we can prepare for it when mapping out potential evolutions.
Commercially viable automated picking in unstructured environments remains a challenge. In the meantime, Locus Robotics and many others such as 6 River Systems, Fetch Robotics, Magazino and KUKA, to name a few, have clear market opportunities. Expect them to be joined by established players in the robotics and cobots market such as ABB. As usual, along with the market opportunities come challenges to tap into this growing robot market in logistics and beyond, whether it concerns the types of cobots or any of the other types of cobots and robots in logistics where robotics have an almost natural place given the challenges of the industry.
Industry 4.0 has started to appear as a major driving factor shaping the future of the worldwide supply chain and is expected to drive the market for logistics robots. Use of technologies such as advanced robotics and AI; sophisticated sensors; big data analytics; high powered mobile devices; and algorithms to direct motor vehicles (navigation tools, autonomous vehicles, and last-mile delivery services), among others are permitting advanced interoperability across enterprises, countries, collaborators, and competitors. The emergence of industry 4.0 utilizes interconnectivity of machines and its processing. It also enables autonomous production methods powered by the Internet of Things (IoT).
Additionally, a rise in the employment cost and wages, increasing focus on safety at workplace, and increasing demand for faster and error-free order fulfillment, among others are anticipated to propel the market growth in the forecast period.
[box type=”note” align=”” class=”” width=””]The author, Khurram Adeel Shaikh, is a PhD Scholar and a freelance writer. Currently he is associated with Bahria University, Karachi Campus, as Assistant Professor and could be reached at khurramadeel.bukc@bahria.edu.pk[/box]