April 07, 2016      

If it ain’t broke, don’t fix it.

The “robots transform logistics” drumbeat got a bit louder this week as yet another report, this time, DHL’s Trend Report: “Robotics in Logistics,” announced what all such recent reports seem to be heralding: “Robotics technology on the verge of delivering large-scale transformation of warehousing and the supply chain.”

Cumulatively, the net-net impact from these reports has got the logistics community either bracing for what’s next or taking action in allotting serious pieces of company budget planning to acquiring some form of robot-driven automation.

A quick look around the floor at MODEX 2016, the premier material-handling expo in the U.S., shows that robots have elbowed their way into much more floor space than in years past. Annually at MODEX, seems robots are getting more numerous.

Thomas R. Cutler, founder of TR Cutler, Inc. and the Manufacturing Media Consortium, sees robot automation as a permanent trend, especially the rapid development and introduction of new robotics technologies like collaborative robots.

DHL’s “Robotics in Logistics” hops onto the loading dock to reinforce the same conclusions as does “The 16 percent solution” chapter highlighted in Robotics Business Review latest research report ‘Industrial Automation and the ‘New’ Productivity.” DHL’s report asks the same overarching question: “Why are there so few advanced robots working in our warehouses, helping us to meet modern distribution challenges?”

The report suggests that logistics operations saw safety problems mixing robots in with humans in warehousing, as well as the fact that traditionally the industry was slow to accept automation as plausible reasons. The reigning sentiment might well be: If it ain’t broke, don’t fix it. Warehouses have a job to do and shouldn’t be distracted by new ways of doing it. If things get a bit hectic, just throw more people at it … but get the job done! More people are the fast-fading solution that keeps supply chain managers up at night.

PricewaterhouseCoopers (PwC) put a number on DHL’s question of why “so few” warehouses are deploying robots, with PwC reporting that only 16 percent of warehouses use robots for materials handling and/or packaging.

The reports detail a malaise that stretches from warehouses and distribution centers clear across every supply chain. See also: “Robotics and the ‘New’ Supply Chain: 2015-2020.”

“There’s a lot more attention on supply chains now than there ever has been, but it’s still a quiet giant,” says Mark Modesti of UPS Customer Solutions. “A lot of companies don’t have their arms around the supply chain piece or understand how big of an impact it can have.”

Nowadays, logistics has bent as far as it’s able without breaking.

Each of the reports cites the same three reasons for logistics having reached maximum extension:

  • The ever-increasing demand for more logistics workers
  • A rapidly shrinking workforce pool from which to secure new logistics workers
  • The e-commerce revolution’s exponential need to ship more and more parcels
  • Expenses for continually recruiting and training of workers are exorbitant

The future holds even greater pressure on material handling. Forrester Research predicts a 10 percent year-on-year growth rate for both the U.S. and Europe, while in Asia it’s growing even faster.

By 2020, for example, China is projected to ship the equal of France, Germany, Japan, the UK, and the U.S. — combined! As end-user buyers now stroll MODEX 2016 with more than conveyors and pallet jacks in top of mind awareness; they are looking for end-to-end material handling solutions that are flexible enough to adapt to an onrushing future.

$31 billion on the table

The low 16 percent anticipated usage rate that PwC reported has not gone unnoticed for potential opportunities. It’s the principal reason why so much of the robotics industry is gunning for it. New logistics robots as well as old-line robotics manufacturers are retooling with new products earmarked specifically for warehouses and material handling.

Amazingly, because of its rarity, Robotics Business Review‘s RBR50 witnessed five of these companies pop onto its RBR50 list just this year (2016). That meager 16 percent is about to change fast and dramatically. Developers of these new warehouse bots have surely studied the logistics marketplace and the prospects therein in depth. They are ready, and so are their machines.

The incentive, other than warehouses being low-hanging fruit: The logistics robot market is forecast to grow to $31 billion by 2020. Here’s a partial list of suppliers of autonomous robots for material handling in manufacturing facilities, warehouses, and distribution centers.

The disruptors have arrived

    1. The newest kids on the block: Ascend Robotics, CANVAS Technology, Fetch Robotics, GreyOrange Robotics, IAM Robotics,, Locus Robotics, Scallog Systems
    2. AVG makers refocusing on warehousing and logistics: Adept (acquired by OMRON) Aethon, Clearpath Robotics, Seegrid, Segway Robotics (yes, that Segway), Vecna
    3. Big boys with eyes on logistics: Amazon Robotics (acquired Kiva Robotics), Hitachi (w/ Epson) Hitachi Racrew, Swisslog (acquired by KUKA) The above list looks primed for lots of M&A activity in the near future, even though the logistics and supply chain industry is massive enough to accommodate them all quite handsomely.

All or most of the companies in the above list are young, small, private, and full of brainy people looking to make an impact in warehouses but who need some help to do it, and have an open mind to all sorts of possibilities.

“Robotics in Logistics” authors Markus Kuckelhaus, DHL’s VP of Innovation and Trend Research, and Clemens Beckmann, Executive VP of Innovation, offer up their vision of how the onrushing robotics world will overspread logistics and then act on the industry to relieve its current pain points:

“Managers of tomorrow’s supply chains will need to either continue to raise costs while reducing service or will need to compensate with automation that can support workers and increase productivity. “Today’s current material handling automation solutions have helped to ease and postpone this challenge but in many cases the solutions are just not flexible enough to cover all of the requirements of a dynamic supply chain. Could collaboration with robots be a possible solution to this problem?”

While traipsing the aisles of MODEX 2016 many end users of material handling equipment will be ruminating on their current, tenuous warehouse operations, and wondering about their ability to handle the future deluge of brown packages headed their way.

Could a machine that works with its human colleagues help fill the future gap between the required workforce and the available labor pool…between getting the job done with ease and maybe not getting the job done at all? That’s why MODEX 2016 is so populated with robots. Next year, there will be many more.