January 26, 2017      

E-commerce operations continue to grow at a solid pace, but a majority of warehouse logistics tasks are still primarily accomplished through manual labor. Since automation offers to increase output levels for order fulfillment, it has received investor interest as logistics startups pursue the market opportunity.

“Warehouse-focused companies saw an aggressive spike in funding in 2015, after seeing virtually no activity in prior years, spiking to 9 percent of that year’s $1.256 billion total,” according to a recent blog post by Lux Research analyst Kyle Landry.

The ongoing increase in investments in logistics startups is providing the needed capital for startups to commercialize robotics products that can keep pace with the demands of a rapidly growing industry.

Landry pointed out that logistic startups are aggressively splitting into two camps — those building warehouse automation to replace human workers, and those building solutions to assist human workers.

Currently, companies focused on developing solutions that help humans are taking a lead position and will continue to find success in near-term warehouse strategies, he said.

Landry stated that these companies “are already capable of full-scale deployments. What these platforms offer, more than anything else, is an ability to automate non-value-added tasks, while providing workers with an opportunity to focus on value-added activities.”

Companies developing and offering logistics automation to replace human workers are facing significant performance and adoption hurdles, noted Landry. These include challenges around perception and navigation, dexterous grasping and manipulation, and dynamic decision-making in complex environments.

In 2016, the total retail sales across the globe were expected to come in at an estimated $22.049 trillion, up 6 percent from the previous year, with e-commerce representing an estimated $1.915 trillion (8.7 percent) of the total, according to a recent report by eMarketer, which tracks retail sales.

The report also estimated that global retail sales will top $27 trillion in 2020, with e-commerce representing $4.058 (14.6 percent) of the forecasted total.

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