Warehouse robotics and order fulfillment logistics are facilitating the growth of U.S. online grocery sales. But supermarket chains will still find significant cost challenges in seeking to capture the consumer’s penchant for buying things online. Fulfilling e-commerce grocery orders is tough. It’s highly labor intensive to put orders together, not to mention that delivery transportation, especially the last mile, is expensive as well. Grocery chains are moving full speed ahead by investing in warehouse technologies and delivery logistics. Meanwhile, an expanding category of third party delivery providers like Instacart and Shipt are partnering with the stores as an alternative to in-house resources.
Even with all the technology enhancements, order volume will still be a key success factor. Right now, the jury is still out on whether U.S. consumers will warm up to buying groceries online. Many shoppers like to pick out their own produce, meat, and seafood. Supermarkets already operate on razor-thin margins, but technology will play a role in deciding which stores will be the winners in online grocery sales.
A WBUR News report discusses more on this topic which is excerpted below.
Grocery shopping is completely different than it was 50 years ago. Fresh groceries and meal kits can now be dropped off at your doorstep. Retailers are redesigning their warehouses for online shopping. Robots adorned with googly eyes alert staff of spills.
Meet Alphabot, a robot that could potentially change how we grocery shop in the future. This little robot can be found at Walmart Superstore in Salem, New Hampshire, in a giant steel structure that stretches from the floor to the ceiling. This robot cage takes up much of the 20,000-square-foot space.
Alphabot was created by John Lert and his company Alert Innovation. Lert walks us through how robots are taking on some of the work involved with filling online grocery orders. Specifically, for packaged products, like cereal and milk.
“All packaged goods would be ordered from a phone, on a tablet kiosk screen in the store. And the robots would pick those orders,” explains Lert.
The system works kind of like a vending machine. Robots move plastic bins called totes that are stocked by humans. The totes are filled with one or a few items of the same kind, like a tote for peanut butter or frozen pizza. The robots move side to side and up and down to fetch the right bins. Then, they zoom to a loading station where a human worker bags your order. Without walking the aisles, workers can build 10 times as many orders per hour.
Overview by Raymond Pucci, Director, Merchant Servies at Mercator Advisory Group
