Logistics Viewpoints

A complete analysis of logistics trends, technologies, and services

Mobile Warehouse Robotics: Flexible Automation Enables Resilient Operations

Robotics | By •

Earlier this month, I wrote an article about the diverse range of mobile warehouse robotics solutions available in the market today. Although the solutions vary greatly, they’re alike in the ability to offer greater flexibility than many of the traditional automation alternatives. The ability to adapt automation to changing requirements is increasingly important to warehouse operators due in large part to the rapid and unpredictable change that has been occurring in recent years (even prior to COVID-19). I am going to take this opportunity to discuss in greater detail, from a capital investment perspective, how flexibility can increase the ROI of a warehouse capital investment.

Flexible Automation Offers Real Options

Many traditional warehouse automation systems offer high throughput capabilities that provide low variable costs of fulfillment. These systems often require a large capital investment with the expectation of operating for multi-year period.  In contrast, mobile warehouse robots are known for their flexibility with respect to routes, tasks, load sizes, and even location of deployment. However, these robotics systems may not offer the same level of throughput that is often obtained by some forms of more traditional automation. A traditional financial review using cost volume profit (CVP) analysis would often determine that the higher throughput capabilities of a traditional automation investment would deliver a lower variable cost, a higher contribution margin, and ultimately a higher ROI due to greater operating leverage.  But the introduction of variability and uncertainty into a financial model – through the use of probabilities and cash flows associated with scenarios – would likely result in a different outcome. For many warehouse operations, variation has increased along with greater uncertainty.  It is informative in these operations to consider warehouse investment decisions from the perspective of real options.

Adapting to Changes     

A 1995 Harvard Business Review article titled The Options Approach to Capital Investment codified from a capital investment perspective what we already know intuitively – that circumstances change and that there is value in making a choice that allows you to adjust in the future as your environment evolves. The authors describe opportunities as options – the right but not the obligation to take action in the future. They introduce the concept of unknown opportunity costs (i.e., an alternative investment option turns out to be better than the one you chose due to changing circumstances) and the creation of additional options from taking action now (i.e. being set up to take advantage of an opportunity when it arises in the future).

In operations with a high level of uncertainty, the ability to adjust provides a greater level of confidence in a capital project’s return due to the wider range of scenarios in which it will provide benefits. Earlier this week, the Financial Times article by @elerianm “Supply chain issues add to stagflationary winds” noted that the persistence of supply side troubles is “leading more companies to revise their supply chain management with a view to enhancing resilience, even at the cost of efficiency.” A flexible warehouse automation investment provides resiliency to warehouse operations that anticipate substantial changes or uncertainty in the future.

Demand, Throughput, SKU Mix, and Channel Shifts

The rapid shift in the retail landscape is the most prominent cause of rapid change in the fulfillment environment. This consumer shift is responsible for massive increases in demand from certain businesses and channels and rapid declines in others. Within many businesses the shift in fulfilment channels has also changed rapidly – mostly from traditional store purchases to e-commerce or omni-channel transactions. The effects to warehouse order profiles have been substantial. In this environment, mobile warehouse robotics provide reliability and operational efficiencies to manual warehouses while also offering the ability scale up and down as throughput requirements change; shift the robotics to a different process within the warehouse; or even transfer a fleet to different facilities as needs change. Mobile robotics support fulfillment resiliency by providing the capability to meet current needs along with the option to readily meet changing requirements or capture future opportunities as they arise.

6 River Systems Demonstrates Collaborative Robotics Solution

Material Handling | By •

ARC Advisory Group’s supply chain team believes that autonomous mobile robotics (AMR) in the warehouse is a high-growth and potentially transformative logistics technology. Therefore, we are devoting substantial effort into tracking the progress of the solutions within this rapidly developing market. On Friday, I had the pleasure of visiting 6 River Systems’ facility and receiving a personal demonstration of its collaborative autonomous mobile robotics system (AMR).

The 6 River Systems Solution

The 6 River Systems solution includes the company’s autonomous robots (named “Chuck”) and a cloud-based software solution that intelligently groups orders together to maximize task density and optimize worker productivity. The software solution also provides real-time robot fleet management capabilities and tracks activity such as worker-robot pairings, units per hour over the shift, and items that have been picked. The robots have 1500 square inches of work space and a maximum load of 160 pounds. The slots on the workspace can be configured a number of different ways to accommodate various operational needs. The robots collaborate with workers by guiding them through warehouse tasks. They facilitate induction and then lead associates through the picking process from bin location, item identification and confirmation, to job completion.

Chuck in Action

I received a live demonstration of Chuck in action at 6 River Systems’ facility. I met the robot at the induction location. The person responsible for induction scanned his badge with the RF scanner on the robot. The printer on the table nearby printed bar codes to identify the totes to be placed on the bot. This bot was configured for four half totes per level (eight total). The induction worker then scanned the bar codes and Chuck’s screen directed the worker to get half totes and displayed the surface area on Chuck where each tote should be placed. There are also lights on the side of the bot that lit up, indicating where to put the given tote. Two verification buttons on the back of the bot then lit up green, and the induction worker pushed the buttons to verify that the task of placing totes had been completed.  Chuck then departed the induction station and traveled to the assigned location to meet the picking associate (this is typically at the end of an aisle).

6 River Systems

We arrived at the meeting location and scanned our badge to register as the picker. The bot then immediately traveled toward the first pick location while its screen displayed a picture of the item to be picked, an arrow pointing to the side of the isle (left) where the item was slotted, and the bin number where the item is stored. Chuck then stopped about two feet beyond the picking location to accommodate the picker. I found these features to be especially useful for helping new workers, and others unfamiliar with the facility layout, to get up to speed quickly.

The red triangle shaped light on Chuck was flashing, indicating that the RF scanner below was ready. I easily located the correct bin, picked the item, and scanned it under the flashing triangle to confirm the pick. The green row of lights on the side of Chuck lit up on the perimeter to indicate the bin in which we were to put the item. At the same time, a wire frame image on the screen also identified the correct bin. We put the item in the bin and then pushed the green verification button to indicate that the pick was completed. The robot immediately began traveling to the next pick location, displaying an image of the next item, an arrow pointing to the side of the isle where the item was located, and the item’s bin number. This process repeated until we completed all picks associated with the job. At the conclusion of the last pick, we pushed the green verification button. Typically, at this point Chuck would provide instructions for the picker to proceed to a location where another Chuck would be waiting, then the full Chuck would proceed to a pack out station or to the next zone, depending on the process flow. In our case, Chuck began to travel to an area designated as the pack out station. I took this opportunity to step in front of the robot (in hindsight, I probably should have obtained consent to do so). The robot stopped, circumvented my location, and then proceeded to the pack out station. A worker would typically scan a badge at the pack station, then the lights on the side of the robot would be used to guide bin removals from the robot.  This station at the 6 River facility was an unloading point, but it also served as the home base for the robot. An Apriltag on the wall enabled the robots to determine their current location in the facility. Once that is determined, the robots have the capability to infer the remainder of the layout from that primary point of reference.

Final Word

The 6 River System robots offer an intuitive design and guide workers to the correct locations and step them through the picking process at a granular level. The robots can clearly increase worker productivity and picking accuracy. 6 River Systems states that its offering can increase units per hour per employee by 200 – 300 percent. Pricing runs at about $250,000 for 8 robots in the first year and maintenance costs of about $50,000 a year thereafter. 6 River Systems currently has 10 customer sites with a total of more than 100 robots in use. It is the company’s end of year goal to have 600 Chuck robots in use across 30 sites.

inVia Scales Autonomous Mobile Robots (AMR) in the Warehouse

Logistics Technologies | By •

ARC Advisory Group’s supply chain team believes that autonomous mobile robotics (AMR) in the warehouse is a high-growth and potentially transformative logistics technology. There is a handful of start-up companies currently offering AMR solutions to meet the challenges presented by the high-volume, high-labor requirements of e-commerce fulfillment. Each of these robotics start-ups is addressing the challenge in a different manner. For example, Locus Robotics‘ solution coordinates autonomous mobile robots to work collaboratively with warehouse workers. The bots dynamically navigate the warehouse floor meeting up with manual pickers until the tote is full and then it and transports the full tote to the pack station, and subsequently returns to pick zones for the next round of work. In contrast, Vecna Robotics‘ Tote Retrieval System uses vacuum technology and an extending tray to extract boxes and totes from warehouse shelving onto a mobile robotic cart. Last week I had the opportunity to speak with Lior Elazary, the CEO of inVia Robotics, about the characteristics of the robotics solution his firm recently brought to market.

inVia RoboticsThe inVia Robotics Solution

inVia Robotics is a Los Angeles based start-up company offering a robotics solution that navigates to an item’s location, picks the desired item/s from standard warehouse shelving, then transports them to the packaging station or the next step in the fulfillment process.  inVia’s robot, including the picking arm, is proprietary. The system includes a mobile robotic platform with a scissor lift that expands to eight feet in height, a vacuum grabber on an extendable arm, vision technology, and the software intelligence that manages the fleet of robots and its operations. The grabber can pick cartons, cases, and cylindrical items. I asked Lior why his company would engineer and produce its own picking apparatus when third-party robotic arms are readily available. He stated that it was imperative to develop a cost-effective solution, and that expensive third-party robotic arms would hinder this value proposition. The cost-effective price point of the solution is supported by a “robot as a service” payment model that removes the high up-front costs typical of traditional warehouse automation. And cost is indeed a major factor in determining the efficacy of the autonomous robotics solutions entering the market. I have found that cost-efficiency, reliability, and scalability are the major characteristics that autonomous robots must possess to become widely adopted warehouse technologies.

The Hollar Case

Last week inVia announced that Hollar, an online retailer of products starting at $1 in price, has deployed inVia’s picker robots and its cloud-based robotics management system. Hollar currently has about 20 inVia robots deployed at its Los Angeles warehouse with plans to scale to 100 in the near future. The robots are deployed in a goods-to-person configuration with the bots picking the items from warehouse shelves and then delivering them to workers at the perimeter of the pick zones for packaging or other next steps in the fulfillment process. Lior stated that they expect inVia robots to improve the facility’s order fulfillment productivity by 300-400 percent. I hope to interview Hollar executives after the busy holiday season to learn more about the company’s use of inVia Robotics’ solution, the benefits it obtained, and the future plans for its warehouse operations.

Autonomous Mobile Robotics In Action at RK Logistics

Logistics Technologies | By •

Autonomous mobile robotics usageLast year after the MODEX exhibition I stated that autonomous mobile robotics (AMR) had moved from the concept phase to commercial availability and practical consideration. At this year’s Promat show I set out to evaluate the commercial progress of AMR in the warehouse. Ideally the progress would be confirmed by referenceable customers willing to discuss their operational success along with the financial feasibility of the solutions. Just yesterday I had the pleasure of speaking with Cindy Traver, the senior director of operations at RK Logistics, about her firm’s successful use of Fetch Robotics’ Virtual Conveyor solution.

RK Logistics is a leading logistics services provider supporting high-tech businesses in the Silicon Valley area. RK had expanded its site in Livermore, CA to 300,000 square feet and increased the facility’s throughput considerably. Still, RK Logistics’ customers were expressing demand for even more throughput, but the facility was encroaching upon several capacity constraints. Looking for a viable solution, RK Logistics evaluated the use of robotics as a means of increasing worker efficiency and the overall throughput of the facility. The company chose Fetch Robotics’ Virtual Conveyor solution as the option that best met its requirements. The Virtual Conveyor solution incorporates Freight series robots, charging stations, and the Fetchcore fleet management system that orchestrates and coordinates the fleet, its travel paths, and its workload. RK Logistics chose to introduce the Fetch Robotics AMR solution in phases.

Phase 1 Increases Volumes and Delivers ROI

RK Logistics deployed Fetch Robotics’ Virtual Conveyor solution to support the spare parts and manufacturing parts fulfillment operations of a leading provider of microchip manufacturing machinery. The solution simultaneously runs three Freight series robots 24 hours a day, seven days a week. The robots are positioned in locations central to the highest pick volumes of parts, each robot stationed about 6-7 rows apart.  Workers receive orders on their RF guns, pick a wave, then load onto the robot and dispatch it for consolidation to outbound shipment. The robots transport the items and free up employee time to focus on the higher value-added processes. Phase 1 has been in operation for over six months and achieved its throughput goals and achieved a rapid payback on the cost of implementation. Furthermore, RK Logistics increased throughput volumes with less man hours, reducing its cost per line item, which ultimately allowed it to pass on savings to its customer.

What’s Next – Phases 2 and 3

In the next phase, RK Logistics will integrate the Fetch Virtual Conveyor solution with its WMS. This will automate the robot dispatch process and introduce greater flexibility by enabling the robots to more easily work across zones. In phase 3, RK Logistics plans to introduce robots with higher load capacity into the receiving area to transport inbound loads to put-away locations in the warehouse.

Final Word

During our discussion, I asked Cindy Traver how she felt the Fetch AMR solution differed from more traditional automatic guided vehicle (AGVs) systems. She confirmed my view. The Fetch Robotics solution utilizes advanced sensing technology that allows the robots to work dynamically with people while avoiding other mobile objects such as forklifts. But more importantly, the Fetch AMR solution is programmable and adaptable to changing facility needs, such as changes in routing requirements or other parameters. In contrast, traditional AGVs typically operate from point A to B and are only one step more flexible than bolted down hardware that requires a facility to adapt its operations to layout of the installed automation.

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