Will Robots Do Your Grocery Shopping in the Future? Not Yet, Experts Say
Given the rise of robotics in e-commerce, many grocers are wondering: will robotics be the next big thing in e-grocery, too?
Some companies believe it might. As online shopping increases, so does the need for fast and efficient fulfillment – whether that's from the store, a warehouse, or micro-fulfillment center. With shipping times getting shorter (some stores now aiming for pick-up in half an hour), several grocers are experimenting with using robots to automate fulfillment, scan inventory, and perform other job duties.
In theory, there's a clear benefit for using robotics this way – they can cut down on the time it takes to fulfill an order, and they can handle a larger volume of work than humans. According to Winsight Grocery Business, robots from Takeoff Technologies can "sort online grocery orders of up to 60 items in minutes and has one-eighth the footprint of a typical supermarket's operations." Ran Peled, CommonSense’s head of marketing, says that "robots [can] handle 95% of the labor and control 99% of the movement of each product."
Recently, Takeoff provided their Micro Fulfillment Center Technology to help the first "robotic supermarket" open in Miami, Florida. In October of 2018, fourteen locations of Sedano's Supermarket launched this new model of grocery shopping, using compact vertical warehouses to save space. Progressive Grocer reports, "The company is currently collaborating with five U.S. regional and national retail chains and has several sites in the pipeline to roll out in next year [in 2019]."
Of course, there is also potential for robotics to join e-groceries as something other than fulfillment workers.
That same month, the grocery story Schnucks in San Francisco launched Tally, their aisle-scanning robot, to track inventory. Tally is currently active in four stores, with plans to expand to fifteen. Walmart is taking the use of robotics a step further, and several steps outside the store. This past summer, the grocer-retailer announced that they're running two big robotics-related tests: one, driver-less cars that will bring online shoppers to its stores, and two, in-store robots that will bring products to the shoppers.
Predictions for the future
Although there's been some experimentation and success in this field, there is substantial doubt that robotics will explode into the scene as robustly as segment-of-one personalization and data intelligence have.
Why? Simple: cost.
The high price tag on implementing robotics into e-grocery might not make Walmart blink an eye, but it's just not feasible for smaller chains. Stores like Sedano's Supermarket and Schnucks will most likely prove to be exceptions to the rule.
One robot runs about $50,000-$80,000, and the required "application-specific peripherals" bring the price up to $100,000-$115,000. Reconditioned robots run for less - between an estimated $25,000 and $40,000 – but still, that only pays for one robot, and to fully implement automated fulfillment would require a fleet. There are other costs to consider, including maintenance, power usage, and any work space modifications necessary to create an efficient footprint for the robots to operate. According to Ron Potter, Director of Robotics Technology for Factory Automation Systems, Inc. in Atlanta, Georgia, the initial start-up cost of implementing just two robots into a work space is $250,000.
One burgeoning development in the industry is "Robotics-as-a-Service" (a spin off of "Software-as-a-service"), which rents robot machinery to businesses, instead of sells it. Options like these could make implementing robotics more feasible to companies, but at this point, they are still uncommon and often cost-prohibitive.
In conclusion, robotics will have their place in eGrocery. But with current costs, using robotics will only be viable where the order volume is large enough to justify the expense and provide a positive ROI. Most markets won't have the volume necessary for robotics to make economic sense and therefore grocers will need to have more than one fulfillment format - robotics in some markets, dedicated fulfillment via manual pick-and-pack in others, and even in-store fulfillment in their lowest volume markets. As a result, grocers eCommerce platforms and order management systems will need to have sophisticated intelligence so that orders can be sent to the appropriate fulfillment format.