Robotech Stories: Warehouse automation and Amazon – a Prime example
- 21 August 2024 (3 min read)
Robotech continues to be a source of long-term growth opportunities, thanks to its diverse investment universe and ability to harness accelerating technological advances. These attributes provide significant flexibility – not only to capture new possibilities, but also to help address challenges attached to them. The cost and availability of labour is a key challenge facing businesses today. The cost of staffing factories and warehouses is rising, while the available workforce is shrinking. This is in part due to younger generations’ growing disinclination to apply for manual, repetitive jobs:
The concept of automation is not new to investors, and its potential for growth and enhanced scalability is expected to lead to greater efficiency, precision, and safety. These advantages may also help to strengthen the ability of industries to respond to the aforementioned challenges such as rising labour costs, shrinking skilled workforces, and ageing machinery.
Amazon has committed significant resources to help drive the future of warehouse automation by continuing to develop logistics robots. In 2023, the company made headlines for welcoming two new recruits, ‘Sequoia’ and ‘Digit’, as an example of the benefits of that automation can provide to both employees and customers of large-scale e-commerce solutions. The first comprises of a multi-function aid to workers as a pilot scheme in its Texas warehouse: Sequoia is able to streamline inventory management and order processing, speeding up deliveries, while its ergonomic console and robotic arm components reduce the amount of manual handling injury risk. Amazon expects this innovative automation solution to be able to identify and store inventory at their fulfilment centres up to 75% faster than today.
Meanwhile, Digit is a pioneering bipedal solution developed in partnership with Agility Robotics. Its greater range of movement and physical handling abilities are designed to expand the functions and dexterity of fulfilment automation devices, enabling them to better navigate warehouse spaces built for humans, and complete tasks requiring more complex movement and grasping skills. Such developments illustrate the potential of automation to take over a greater range of repetitive, manual handling operations, thus ‘freeing up’ warehouse workers for more complex tasks. Amazon first entered the robotic space in 2012, when it acquired Kiva Systems and their fleet of automated guided vehicles (AGVs). After more than a decade Amazon has now a long track record of adopting robotic solutions at scale, with around 750,000 already in operation. This is one of the main reasons why Amazon is the number one e-commerce player globally, being able to deliver millions of products daily with a next day delivery option. Its continued commitment to research and development is forecast to not only provide labour solutions and efficiencies, but also to create new roles and industries within the robotech field.
The evolution of warehouse automation illustrates just one of the range of examples where companies within the robotech investment universe possess both the agility and the technology to provide both opportunities and solutions to cross-sector modern, global industry and commerce.
Companies shown are for illustrative purposes only as of 21/08/2024. It does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute an offer to buy or sell any investments, products or services, and should not be considered as solicitation or investment, legal or tax advice, a recommendation for an investment strategy or a personalised recommendation to buy or sell securities.
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