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PEAK: 2020 Challenges. 2021 Opportunities.

The 2020 peak season presented challenges for grocery and omnichannel retailers, distribution center operators, and warehouse managers alike.  From ensuring employee safety and managing labor capacities to keeping up with demand and meeting consumer expectations, there was no shortage of challenges this peak season.

Safe Working Environments and Manual Labor Capacities Create Need for Automation

Following recommended guidelines by the CDC to keep warehouse employees safe has proven difficult for facility managers.  The ability to socially distance, make contact tracing available and reduce surface touchpoints largely depends on the design and technologies employed in your distribution center.

While one size does not fit all, a smart design might incorporate an automated goods-to-person (G2P) system like CAJA’s robotic fulfillment system, which is comprised of advanced software, specialized robots, and user-friendly workstations.

The set workstations (or picking stations) allow for a controlled environment where workers can socially distance themselves.  Moreover, the specialized robots, which take boxes from inbound to inventory and inventory to the picking station, reduce the number of surface touchpoints in the facility.

Increasing Customer Expectations and Surges in Demand Drive Need for Micro-Fulfillment

There had been a significant acceleration of consumer trends for several months leading up to the 2020 peak season.  According to Deloitte, 2020 expected holiday e-commerce sales were up 25% to 35% compared with the same period in 2019.  Consumers are demanding more than ever before – not only in the quantity of demand but in the convenience of experience.  They expect faster and more accurate order fulfillment. 

Given the variables in last-mile delivery, the cost to meet consumer expectations is only growing, so traditional distribution strategies are no longer cutting it for the bottom line. To remain profitable while meeting customer expectations, grocery and omnichannel retailers will need to shorten the supply chain.

This can be accomplished by implementing Micro-Fulfillment centers (MFCs).  MFCs go beyond goods-to-person solutions (G2Ps) in that they allow retailers the flexibility to expand their fulfillment capabilities relatively quickly. This is because MFCs leverage existing footprints close to the consumer.

To best meet consumer expectations and prepare for future unexpected surges in demand, retailers should adopt a micro-fulfillment strategy utilizing (robotic) dense, scalable, and flexible storage and order picking solutions like Exotec’s Skypod System.

Exotec’s Skypod System is as efficient as a traditional automated order-picking system while remaining highly customizable and scalable. Its ability to change in size and independently register storage needs and flows makes this the perfect G2P solution for your MFC.  The Skypod System allows retailers to quickly fulfill complex customer orders with the utmost accuracy.  Moreover, the system’s minimal implementation time – as low as six weeks – enables retailers to quickly adapt to surges in demand.

We Simply Cannot Afford Not To Invest in Automated Technologies

As we reflect upon the 2020 peak season and begin to prepare for 2021, it is important to remember that these automated solutions address more challenges than just those presented/heightened by COVID19.  These solutions represent the future of material handling and fulfillment, and only those companies willing to invest will adopt the agility and resilience required to compete – let alone survive – for years to come.

With over 40 years of experience, our team at AHS is uniquely equipped to help you prepare for the unexpected and quickly respond to dynamic market trends. Take the first step in building your resilience and contact our team today!

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