ServiceFriday: Busy as a Bee – A Look into the Warehouse of the Future
While many online retailers like Amazon nowadays use parallel zoning or conveyer belt-based order-to-man approaches in their warehouses, dubbed Customer Fulfillment Centers, Ocado Plc., a British online supermarket company, has now raised the bar of online grocery shopping by deploying robots to assemble customer orders.
The Ocado system, aptly called a hive, has captured the attention of retail managers around the globe. The system uses a crisscrossed railway structure installed in the warehouse that not only allows the robots to move along the length of the warehouse, but also doubles as a shelf. Each square in the grid houses one or several items that are automatically picked up and refilled by an army of dishwasher-sized robots that zip along the rails at staggering speeds. A complex algorithm constantly adjusts the path of each robot, always searching for the quickest pickup sequence while making sure no collisions happen while the robots rush by each other, sometimes only missing each other by inches.
By implementing this approach, Ocado was able to increase the efficiency of their warehousing, which allowed them to fulfill online customer orders within a 1-hour time window. While being dismissed as just another online supermarket, the company has now caught the attention of Kroger Co., who purchased 6 percent of Ocado to take up the fight against Walmart and Amazon in e-commerce. What’s more, the deal with Kroger also includes the construction of 20 distribution hubs equipped with their new warehouse management system. This allowed Ocado to do what they had been aspiring to do for years: to make the transition from a low-margin online shopping center to a high-tech B2B service provider.
A video of the Ocado system in action can be found here: https://www.youtube.com/watch?v=4DKrcpa8Z_E
Link to the original article in The Economist:
https://www.economist.com/britain/2018/05/24/ocado-the-tech-startup-you-thought-was-a-supermarket