The Economics of Supply Chain Robotics - Robotics Business Review
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The Economics of Supply Chain Robotics
Robots that deliver lowest labor rates, empower manufacturers to dominate
By RBR Staff

EBN.COM: A first batch of 10,000 robots – aptly named Foxbots – has made its way into at least one factory. Each robot costs between $20,000 and $25,000, which is over three times the average salary of one worker.

However, amid international pressure, Foxconn continues to increase worker salaries with a 25 percent bump, occurring earlier this year.

With the cost stated to be about three times the annual salary of a worker, this translates into a payback or break-even point where the robots pay for themselves after three years.

According to on the Singularity website, Foxconn starts off a worker at $14/day, and after two years that number doubles to $28.

Three-year ROI

If the cost of the robots drops to near zero after three years, then the perceived value of the human workforce will deteriorate commensurate with their potential robotic replacement cost. So, the workers will continue to lose any kind of leverage when it comes to fair labor practices.

foxconn workers

As this relates to supply chain economics, it means that the lower cost of labor should increase the company’s profit margin and allow the contract manufacturer to reduce its end-product prices such that the company becomes more competitive in the marketplace.

Eventually, the factory with the lowest labor rates for similar products will win or dominate the market segment to which the product is targeted. That fact alone will drive further deployments of robots, resulting in an increase of the robot population throughout the world.

Now, the target cost reduction emphasis will be the cost of maintenance and upkeep of the robotic equipment. The state-of-the-art factory of tomorrow: Designers will be focusing on software and mechanical features that allow for diagnostics that will be inclusive of the operating and lifecycle status of all mechanical and electrical interfaces with regard to wear-out and replacement demands.

Supply-chain robot analytics

Digital Hall Effect proximity sensors, pressure and flow detection, accelerometers, and temperature gauges will be built in to monitor mechanical wear-out, critical adjustment settings, physical gap spacing, real-time fluid pressure and viscosity status, and where a robot’s moving parts are at any given moment in 3D space.

There will also be other digital sensors and transducers integrated into the designs in order to capture the operating condition of any particular robot function.

Now, tie all of this diagnostic digital feedback into a central supercomputer programmed to flag maintenance alerts and launch either pre-scheduled preventive maintenance operations or emergency replacement operations, and the factory can realize close to a 100 percent uptime statistic.

The reliability can be further increased by designing in redundant subsystems like power supplies with hitless switch-over connectivity. The MHSB backup system would kick in seamlessly in the event of a critical system-level failure that could potentially shut down either a single robot’s operation or an entire production line.

3D printers make replacement parts

Continuing with the design considerations of making all replaceable parts out of materials that can be printed on the newest and upcoming 3D printers and the spare parts management is greatly simplified by having an on-demand 3D printing operation also under the control of the alerting supercomputer.

If a part is close to its wear-out point, the printer is flagged by the central computer to create the replacement part so it will be ready to deploy for replacing the aging part before failure.

Every part in the online robot would already have a mechanical computer-aided design (CAD) file from its original design. Those CAD files could be kept in a server that was accessible to the 3D printer for rapid replacement part production.

In the very near future, design considerations will include 3D printing capabilities. When that happens, human beings will be in place just to make sure the factory has human overseers that will make sure the top-level machines are doing their jobs—if you catch the double meaning.

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