Navigating the Future of Logistics: Flexible Automation, AI, and Supply Chain Resilience

What are the most significant trends shaping the storage and distribution sector?

There is a growing interest in agile and flexible mobile robots. They offer scalability and can be deployed quickly with little to no infrastructure changes. Companies can pay for most mobile robots via a service model. They can rent or lease them for a specific period of time to increase efficiency during seasonal peaks. This allows warehouses and fulfilment centres to invest less capital upfront, yet have a strategy that is flexible upon seasonality and trends. 

What are the most common misconceptions the public has about the logistics industry?

Consumers have come to expect next or same-day delivery of their shipments, yet not all companies, especially small and mid-sized brands, have the necessary infrastructure or supply chains built to meet that expectation.

This creates an opportunity for us as solutions providers to help those small and mid-size brands meet consumer demands by building a network that supports growth strategies, while at the same time maintaining profitability.

How are logisticians planning for and adapting to supply chain disruptions?

Supply chain leaders recognise that their networks need to be far more diverse. Diverse in how and where they source products, the technologies they use, and who they partner with. These decisions are critical because geopolitical factors can have adverse effects on the supply chain, and partners must be able to support the market changes. 

Depending on the product and industry, the playbook for de-risking supply chains can include buying more frequently, purchasing larger quantities, diversifying providers, and/or outsourcing locally, for instance.

Distribution strategists are tapping into last-mile delivery services to reach the brand’s end consumers without the need to build their own network. Click-and-collect, a delivery method where online shoppers select the designated location to collect their purchase, is becoming increasingly popular in European markets as companies seek to be more responsive locally and enhance the consumer experience. Statista reports that click-and-collect orders were worth 23.3 billion British pounds in 2022, and it forecasts the market to exceed 30 billion British pounds by the end of 2025.

What is the role of industry events, like IMHX, in driving the logistics industry forward?

IMHX is a place for fulfilment and warehouse executives to discover new technologies and see robotics in action. Technology providers enjoy the show because it’s an opportunity to connect face-to-face with other people who appreciate powerful innovation. We meet new people, brainstorm and inspire each other to try new things.

This year, my teammates from Ocado Intelligent Automation (OIA), part of Ocado Group, will be at the conference showcasing our Chuck AMR. Chuck combines fulfilment execution software with autonomous mobile robot technology to support warehouses with mid and low throughput, reduce the cost per unit shipped and fulfil orders faster. 

What emerging technologies are having the biggest impact on warehouse operations?

The increasing wage rates required to attract and retain labour are degrading suppliers’ profitability, especially in markets where margins are very small. Autonomous mobile robotics (AMRs) for picking and case handling are helping warehouse operators stay competitive and succeed. 

Consider third-party logistics providers. They generate revenue on every pick they make. The more efficient their picking process is, the more money they make during the contract period. Having AMRs guiding employees, travelling the warehouse floor in a self-directed manner, and optimising picking paths boosts picking rates and translates into savings. NRI, a third-party fulfilment service, reduced the variable cost per unit pick by 12% using OIA’s Chuck AMRs.

What role do predictive analytics and AI play in inventory management?

The moment warehouses have data in their hands they can unleash artificial intelligence (AI) to run predictive models. With AI, logistics leaders can understand demand ahead of time and build a solid fulfilment and supply chain strategy to meet it.

Think of a retailer launching a new product. Using AI to examine past data, their supply chain team can forecast demand volumes weeks before a product launch and adapt warehouse operations accordingly. The data can provide insights to help determine whether it’s more productive to use an automation system or a manual workflow for a particular SKU.

How can SMEs develop an effective automation strategy?

We recommend supply chain executives consider three actions:

1. Select partners thoughtfully. A valuable partner will work closely with you and advise on the best system design, set up and what it can integrate with. 
2. Make wise investments that support nimble supply chain strategies. Be cautious about panic-buying systems and material handling equipment (MHE) to address peak-season challenges. They often go underutilised throughout the rest of the year. 
3. Acquire adaptable supply chain technology and ensure the solutions are in lockstep with your operation’s specific needs. An automation system for an e-commerce operation isn’t the best fit for an omnichannel retailer. Start with a solution that addresses the immediate challenge, such as adding robots you lease (such as OIA’s “flex Chuck”) as a service. Use it to gain more data and insights as to where the challenges still lie. Then reassess to determine what complementary automation you’ll need to scale.