The competition for warehouse and fulfillment workforce has reached a tipping point. The sustained growth across B2C channels has resulted in the growing demand for skilled warehouse workers. Even the wages for warehouse staff have peaked at $18 per hour in the USA, but still attracting and retaining skilled personnel has remained a serious challenge. As a result, organizations are rapidly moving toward warehouse automation for sustainable growth in the long term.
As venture capitalists invest heavily in warehouse automation, various innovative solutions have come to the fore. This includes SCaaS (supply chain as a service) models and the latest technologies that combine several solutions for retailers. One such example is the introduction of AMRs (autonomous mobile robots). They have addressed the issue of non-productive walking time in warehouses for small corporations like German retailer Rofu Kinderland and large corporations like DHL.
Latest Tech Evolutions in Warehouse Automation
The unprecedented boom in the eCommerce sector has expedited the growth of the warehouse automation industry. It is estimated that the warehouse automation industry will continue to grow at an average annual growth rate of 14%, eventually reaching $30 billion in valuation by 2026. Here are the latest tech evolutions in warehouse automation fueling this incredible growth.
1. Robots becoming imperative
Robots can increasingly take up important roles in warehouses through better configuration technologies. The market value for mobile robots is expected to top $334 billion by 2042. Most experts agree that robots generally cover their costs within six to nine months, making them a popular choice for even mid-sized businesses with lesser budgets. Warehouses use robots for batching, picking, packaging, fulfillment, transportation, and inspection.
Automated mobile robots and automated guided vehicles are further boosting the rate of warehouse automation. Compared to automated storage and retrieval systems, they are scalable and do not require infrastructural investment. Slowly, mobile robots are replacing conveyors in most warehouses as they are more space effective.
2. Rise of the Drones
Improved hardware and software configurations have made drones an interesting solution for warehouse automation. Innovations have brought down the costs and have improved the battery life of drones. Apart from delivery and shipping, drones are used for various tasks like cycle counting, scanning barcodes, inspection and retrieval, inventory scans, and reaching remote locations. Third-party logistics companies are adopting automated drones.
3. Internet of Things
IoT is emerging as the core technology powering warehouse automation. By connecting and coordinating different moving pieces in a modern warehouse, IoT is revolutionizing operations. It is estimated that the warehouse IoT market will register a CAGR of more than 21% by 2025. IoT enables automated warehouses by allowing users to connect and monitor components like drones, workers, pallets, beacons, and other equipment to scan, store, and retrieve data. IoT is also enabling the holistic performance of all connected devices in a warehouse. For example, temperature sensors connected with IoT help with cold storage monitoring.
4. Wireless Fleet Management
Wireless fleet management solutions are being integrated with IoT-enabled sensors that are helping with the monitoring and management of vehicles in the warehouse. Wireless fleet management systems help with maintenance, compliance, and monitoring of vehicle and driver performance. This helps ensure better safety, improved customer satisfaction, and real-time updates across the entire fleet. Vehicles that fall under the purview of Wireless fleet management are helping with the identification of potential risks related to overheating and damages. As a result, the market for fleet management solutions is expected to cross $60 billion by 2028.
The global supply chain blockchain industry is estimated to grow at a CAGR of 81.7% till 2025 as blockchain technology is revolutionizing warehouse management. Blockchain is helping warehouses with enhanced data authentication, predictive analysis to estimate demand, track shipments, understand purchase patterns, and several other essential tasks. For example, Walmart was able to forecast food shortages after implementing blockchain technology in partnership with IBM.
Impact of Warehouse Automation on Other Industries
Warehouse automation is being considered a watershed movement in the industry worldwide as it has far-reaching implications for other industries. In addition to warehousing, these latest innovations will impact Third Party Logistics, FMCG companies, courier and postal companies, and several other industries.
Warehouse automation is expected to assist supply chain operators in several ways: lower operating costs, lower labor expenses, and better inventory transparency.
When it comes to warehouse employment, there will be tectonic shifts. As less manual labor would be required in the warehouse, new employment opportunities will come up in the maintenance and servicing of the automation systems.
Additionally, there will be a growth in tech-related industries involved in manufacturing robots and drones, implementing IoT solutions, and blockchain developers. Overall, the future of warehouse automation is extremely bright and is slated to change the warehousing industry forever in a few years.