User-friendly websites, attractive discounts and same-day deliveries; shopping has evolved tremendously for consumers over the years as the e-retail experience has gone through several stages of improvement. The list of things that can be bought online continues to grow and so does the need to fulfil orders with greater efficiency, speed and accuracy, and on a phenomenally larger scale. This is where technologies like robotics and AI come in.
If you think about your favourite e-commerce website with millions of consumers shopping online every day, and imagine the millions of orders that need to be picked, packed and shipped from several distribution centres, you would realise that processing those orders is a mammoth task if it is to be done manually!
As consumers get more used to and expect same or next-day deliveries, few recognise the role of autonomous and collaborative robots play in revolutionising last-mile delivery. A report by DHL states that the growth of e-commerce and online retail is one of the fastest growing sectors across the globe clocking 10% of the total retail sales in 2017, and it continues to grow. In India, with a CAGR of over 30%, online retail in India is expected to reach $200Bn by 2026. With the industry operating at such a growth rate and on such a massive scale, online retailers now recognise the huge opportunity that the last mile represents.
E-commerce: order fast and deliver fast
The global e-commerce boom continues to put enormous pressures on supply chains. While online shopping is near effortless for consumers, at the same time it has made it more strenuous for e-commerce businesses to cope with demands like same day delivery or better yet, 4-hour or 2-hour delivery in major cities. Businesses operate in a volatile and multi-SKU environment, handling large numbers of orders to be shipped every single day. Increased volumes, cost pressures, and the need to run leaner inventory make inventory management much more complex than before. To ensure higher productivity and faster delivery, these e-commerce giants and 3PL fulfilment partners have pioneered the use of advanced technology systems for their supply chains.
When we talk about last mile delivery, order fulfilment is one of the most complex and critical aspect of any supply chain operation. Situations like managing increasing numbers of SKUs, seasonal peaks, numerous single-item as well as multiple-item orders, along with same- or next-day delivery, all call for efficient supply chain management.
The fulfilment process in a warehouse can constitute up to 25% of supply chain costs. To keep costs down, some retailers have adopted advanced technologies such as AI and robotics to ensure they build a supply chain to manage current requirements, as well as to cope with future growth. Flexible automation solutions deployed in modern warehouses can help retailers stay competitive by getting orders ready more efficiently.
A warehouse robotics system automates the complex processes which help eliminate errors, increase accuracy, check pilferage and enable real-time audit of the inventory. E-commerce and retailers are now adopting robotics worldwide in their fulfilment centres, for cost efficiency, better space utilisation and enhanced consumer experience through faster deliveries.
The fast growth in e-commerce is changing retail operations in a big way. Technologies like AI, machine learning and machine vision are catalysts in driving the adoption of robotics systems in distribution centres across the world. It may take a simple click on a mouse to ask for same-day delivery, but it requires advanced technological support in the fulfilment centre to deliver on such a simple request . The scene is set for a revolution in last mile delivery operations, and in the next few years we will witness big advances in the way technology will help deliver the millions of parcels arising from shopping online!
Sid Chatterjee is the Vice President–Products, GreyOrange.