PULSE Welcomes You To ProMat DX

PULSE Welcomes You To ProMat DX

ProMatDX
ProMatDX, held April 12-16, 2021, is the new digital event experience designed to power up manufacturing and supply chain professionals from the U.S. and over 140 countries with critical access to the latest solutions they need now to improve the resiliency and agility of their operations.
ProMatDX combines the power of the connections, solution-sourcing and education that only ProMat can deliver with the latest digital event technology in a five-day event that will be the most important week of 2021 for the manufacturing and supply chain industry.
Attending ProMatDX is your unrivaled opportunity in 2021 to find solutions, connect with your peers and leading solution-providers and learn the latest trends and technologies that will take your supply chain to the next level of success. PULSE will be featuring state of the art order fulfillment technology at the upcoming virtual show. Make it a point to visit us

Click Here To Visit Our Showcase

Brittain Ladd, Andrew Benzinger of AutoStoreDon’t Miss Out On These PROMAT DX Educational Sessions!

Micro-fulfillment is one of the most talked about but least understood solutions on the market. Attend this session to learn the Who, What, When, Where and Why of Micro-Fulfillment.
PULSE’s own Chief Marketing Officer, Brittain Ladd, will be co-presenting with AutoStore’s Andrew Benzinger on the topic Why Micro-Fulfillment Is a Must Have.
Learn how combining additional technologies will supercharge your fulfillment strategy and create a competitive advantage
Mark your calendar for this revolutionary educational seminar held April 12, 2021 from 1:30 PM – 2:00 PM CT
Matt Chang and Matt RendallPULSE Integration’s Chief of Strategy & Innovation, Matthew Chang, and OTTO Motors CEO and Co-Founder, Matthew Rendall, share information about The Business case for AMRs in Manufacturing vs. forklifts, conveyors, and other modes of material handling at both greenfield and brownfield facilities.

This session is focused on providing a detailed discussion on the value of AMRs within a corporate supply chain.

Speaker Matt Chang, one of the most experienced experts on the topics of AMRs, will introduce content specific to the importance of companies adopting AMRs and the business case for doing so. Real world examples of how AMRs have been introduced will be provided. Check out more about PULSE’s AMR deployments here. Read our Business Case for AMR’s in Manufacturing here.
Mark your calendar for this revolutionary educational seminar held April 14, 2021 from 9:30 AM – 10:00 AM CT

Don’t Forget to View PULSE’s Product Demos at the Show….

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PULSE.exe
Software Solutions
April 14, 2021
10:00 AM CT
AMR Solutions
PULSE
AMR Solutions
April 13, 2021
10:00 AM CT
PULSE Solutions
PULSE
Solutions
April 12, 2021
10:00 AM CT
The Future of Robotics Solutions & Automation

The Future of Robotics Solutions & Automation

As the world begins to adopt more forms of automated systems, it raises concern for the impact on job loss.  While robotics can automate and improve efficiency it is not a substitute for all operations and human labor in the industry. A study conducted by Deloitte shows that 60% of companies are utilizing robotics as an assist to with current workforce rather than to replace it altogether.

This will lead to a fundamental change in the duties assigned to human roles.  Repetitive, labor-intensive, and oftentimes potentially dangerous tasks will be replaced by robotics while more crucial and analytical roles will still need a personalized touch of human involvement. Robotics and AMRs help boost productivity, efficiency, resilience, and even safety within a facility, however, humans are still needed to play critical roles in the overall system. The ideal solution is a blend of human involvement and robotic automation.

The pandemic showed the world that the current supply chain model was modeled after a world that does not exist anymore. Customers demand easy access to products, speed of delivery, and high-touch customer service.

AutoStore automated fulfillment solutionsBusinesses must evolve quickly to navigate the ecommerce demand and to stay ahead of their competitors. Convenience and social distancing take precedence over the in-store shopping experience. Businesses that can serve eCommerce customers efficiently and effectively will win market share.

Today’s competitive businesses are seeing that the use of Robotics is becoming cost effective for order fulfillment. More retailers are relying on automated fulfillment and robotics to lower costs, ensure accuracy, and decrease processing times. eCommerce continues to account for a larger percentage of market share each year. Grocers must meet demand with grocery fulfillment that works for both the business and the customer. Customer expectations have evolved, and efficient grocery fulfillment solutions are quickly becoming necessary for a competitive market. Online shoppers expect to locate the same variety of products, with little to no change in price points. Consumer needs and tastes are rapidly changing, and the dominance of eCommerce has changed customer expectations. New technology enables your business to futurize processes and increase the utilization of existing assets.

PULSE Integration partnered with OTTO Motors to complete the largest at scale deployments of AMR technology in North America. The Business Case for AMR's in ManufacturingDuring the study, PULSE compared AMR performance to existing technologies and human load factors. The result, AMR’s represented 10% of the equivalent manual handling labor costs and 20% of the cost of a forklift.  It is important to note the situational aspects associated with this study. At higher speeds and with advanced safety features, AMR’s outperformed manual carrying, and driver operated pallet loaders over long distances. However, humans have more agility moving goods for short distances or around stations.  It was determined that a blend of both would create the optimum result with output and efficiency. AMR’s would conduct the heavy lifting and repetitive labor while humans would operate at stations carrying out tasks of picking, sorting, or quality control.

Reducing the number of people moving around a facility compounded with the risks of human driver error, and injury related to repetitive “heavy lifting” tasks helped alleviate some of the many key hazards companies continue to face leading to costly accidents in their facilities.

Read More About PULSE Integration and OTTO’s deployment of AMR Solutions in the attached white paper.

Read More Here

Largest AMR Fleet Deployment

Largest AMR Fleet Deployment

PULSE Integration partnered OTTO Motors, to undertake what is the world’s first in-depth analysis of automated mobile robots (AMRs) deployed at scale in industrial facilities. With hundreds of facilities across North America, this billion dollar organization is a household name in Consumer Packaged Goods. In 2 facilities spanning over 1.7M sq ft, this Fortune 500 company is 100% reliant on OTTO technology for their material transport.

Watch the video here

View the business case here

Micro-Fulfillment as a Service

Micro-Fulfillment as a Service

A challenge faced by vendors that wish to introduce new technology into the grocery industry is that many grocery retailers are risk averse. Instead of jumping at the chance to embrace new technology, most retailers take a ‘wait and see’ approach. Specifically, grocery retailers wait to see what Amazon and Walmart will do. This has been especially true regarding the topic of micro-fulfillment. Although the use of micro-fulfillment centers within a retailers grocery ecosystem makes operational and financial sense, most grocery retailers have sat on the sidelines.

That has changed as a result of the announcement by Walmart that it is going to install micro-fulfillment centers in an undisclosed number of stores. Walmart will install solutions from Alert Innovation, Fabric and Dematic.

Walmart indicated that they are still in the testing and evaluation phase and that they have not identified the optimal solution. (You can read more about the different micro-fulfillment systems on the market here).

I have proposed the use of micro-fulfillment centers inside retail stores, in buildings next to retail stores, or in offsite ‘Dark Stores’. Micro-fulfillment is a must-have for retailers. However, let me be clear, micro-fulfillment isn’t just technology a retailer can purchase and install. Micro-fulfillment is a strategy retailers can leverage to reduce costs and complexity related to fulfilling online and curbside grocery orders, create a competitive advantage, and enable growth.

Most retailers that choose to leverage micro-fulfillment as part of their strategy have entered into direct arrangements with specific micro-fulfillment vendors. For example, H.E.B entered into an agreement with AutoStore. I rank AutoStore at the top of the list for micro-fulfillment. (Dematic will probably introduce the AutoStore system at Walmart; something I strongly recommend).

Is a direct relationship with a vendor the optimal choice? Is there another option retailers can choose? Yes, there is.

Micro-fulfillment as a Service (MaaS)

I prefer retailers to purchase and install micro-fulfillment centers across their ecosystems. I believe owning and operating MFCs is a wise move strategically for retailers.

However, retailers that don’t want to own and operate MFCs have the option to utilize Micro-fulfillment as a Service (MaaS). MaaS is a service that a few MFC companies are offering to retailers. Fabric has done a great job of marketing MaaS to potential customers.

At a high level, MaaS is a service whereby an MFC company will purchase or lease a building to install micro-fulfillment centers. An MFC company can also install one or more micro-fulfillment centers onsite in a company owned facility.

Once installed, the MFC company will provide the required labor (or use a 3rd party) to run the facility. Customers that sign up for MaaS ship their inventory to a MaaS location where the inventory is either stored or immediately placed inside an MFC. Retailers will have little to no upfront costs to leverage MaaS. The MFC company will fulfill orders for their customers. On average, the MFC company running the MaaS location will charge between $.58 to $.60 per line picked.

Sounds like a great deal!! It’s not. MaaS is nearly impossible to justify due to high operational costs. On average, grocery retailers can lose up to $25 on every online order they fulfill. MaaS reduces the cost of fulfilling online orders but not as much if a retailer operates their own micro-fulfillment centers.

Based on analysis completed by several strategy consulting firms, and based on my own analysis, the MFC companies offering MaaS have greatly underpriced their services. In addition, the projected order volumes that can be filled using a MaaS model will be difficult, if not impossible, to fulfill because of limitations within the MFC systems being used by the companies I evaluated.

Regardless of the limitations, I expect MaaS to grow in popularity for these reasons: Executives at some retailers will be very risk averse. To minimize risk, they will choose to essentially outsource micro-fulfillment. I know of several grocery retailers that are in the process of evaluating micro-fulfillment systems. A few of the retailers are leaning towards using MaaS as a way to reduce capital spend and mitigate risk.

Recommendations

Using real world examples, this is what I recommend all grocery retailers that are interested in MaaS to do.

Albertsons is one of the leading grocery retailers in the United States. The company is led by CEO Vivek Sankaran, former President and COO of Frito-Lay North America. I believe Vivek should be considered one of the best CEOs working today. I have written multiple articles about Albertsons and I have publicly stated that Albertsons should merge with Ahold-Delhaize. If the merger occurs, it would create the largest grocery retail conglomerate in the United States, and one of the largest in the world.

Based on announcements from Albertsons, the company is evaluating options for micro-fulfillment. Albertsons has a relationship with the MFC company, Takeoff Technologies. (I am a former advisor to Takeoff and Fabric).

Full disclosure: I have had multiple discussions with executives from Albertsons regarding the topic of micro-fulfillment. I also advised executives from H.E.B, Ahold-Delhaize, Publix, Amazon and Walmart on the topic of micro-fulfillment. However, I do not work for a micro-fulfillment company. I work for a system integrator, PULSE Integration, that has relationships with several MFC companies. I also write articles on the topic of micro-fulfillment.

I applaud Albertsons focus on micro-fulfillment. However, what should Albertsons do?

In my professional opinion, I recommend that Albertsons purchase and install MFC systems from AutoStore. If there is resistance within Albertsons for such a model, Albertsons should evaluate MaaS as an option. However, instead of only testing MaaS as a solution with one MFC company, I encourage Vivek Sankaran to speak with AutoStore, and negotiate an agreement whereby AutoStore will operate one to three MaaS locations for Albertsons.

AutoStore hasn’t embraced MaaS due to analysis they have performed that indicates MaaS is a higher cost and lower value option for grocery retailers than grocery retailers owning and operating their own micro-fulfillment centers. However, I believe AutoStore has no choice but to offer a MaaS solution due to growing interest in the topic. I strongly encourage AutoStore to partner with Albertsons.

Sankaran should also have one to three AutoStore MFCs installed within their grocery ecosystem, including installing an AutoStore inside a grocery store, to test which MFC performs the best. Sankaran can compare the results of MaaS and a company owned and operated MFC model at the end of one year. May the best MFC solution win.

In addition to micro-fulfillment, I strongly encourage Albertsons (and all retailers) to test the use of last mile delivery carts from the company Tortoise, and testing mobile retail using vans from Robomart. Both companies are generating a lot of interest from retailers. (I am an advisor to both companies).

Finally, I recommend that Albertson (and all grocery retailers) to improve the customer experience for online grocery delivery by providing their customers with a DynoSafe or a similar product. This article outlines the importance grocery retailers “winning the porch.”

Publix, Kroger, Ulta Beauty, Sephora, Macy’s, owners of malls, convenience store chains, and large retail development companies should also test MaaS and operating MFCs within their retail ecosystems.

What’s Next for Micro-fulfillment? 

I am convinced that Instacart will invest heavily in micro-fulfillment centers starting in 2021; probably with Fabric. Instacart will go public in 2021. By 2022, 80 to 100 micro-fulfillment centers will be dedicated to Instacart’s needs. By 2025, Instacart will become an online grocery retailer fulfilling orders direct to their customers. Instacart will end their relationship with their current customers. I anticipate that Instacart will open Instacart-branded stores in select locations. If I’m correct, Instacart should acquire Fabric in 2021. (Instacart is in an interesting position. I recommend Shopify, Google or Facebook to acquire Instacart).

Amazon is investing heavily in micro-fulfillment. I anticipate that Amazon will soon unveil a 20,000 square feet MFC built inside one of their AmazonFresh branded stores. I’m convinced that Amazon has no choice but to explore the use of Nano-fulfillment centers inside Whole Foods stores. I designed one of the first micro-fulfillment centers specific to the needs of Amazon. You can read about it here.

Amazon is creating a business model whereby they will sell more groceries through their Amazon branded stores than through Whole Foods. Why? Because Amazon is going to sell branded CPG and organic products inside its supermarkets. When Amazon acquired Whole Foods, I stressed to Amazon that they should introduce branded CPG products at Whole Foods to increase customers. The stores could be re-branded to ‘Whole Foods Plus.’ Amazon didn’t introduce branded CPG products at Whole Foods and sales have stagnated.

An argument can be made that Amazon should divest Whole Foods and focus on its own AmazonFresh brand. Target is the company that should acquire Whole Foods. Target can open Whole Foods Markets inside its stores. I have recommended to Amazon on several occasions to acquire Target and also open Whole Foods Markets inside Target’s stores. Since the acquisition hasn’t occurred, I’m skeptical that it ever will. If Amazon is not going to acquire Target, divesting Whole Foods should be explored.

Amazon and Kohl’s are piloting an AmazonFresh store inside a Kohl’s store; this is something that I recommended to Kohl’s and Amazon over two years ago so I’m glad that pilot has begun. If the pilot is successful, I recommend that Amazon should acquire Kohl’s.

DoorDash, Postmates and other restaurant delivery companies must expand into delivering groceries. I strongly recommend that these companies should invest in opening their own micro-fulfillment centers powered by AutoStore or some other MFC system. Grocery retailers are actively looking for a replacement for Instacart. Postmates, for example, could open MFCs; receive inventory from grocery retailers; store the inventory inside each MFC system; fulfill online and curbside orders; and use their own delivery drivers to deliver orders.

I also believe that restaurant delivery companies that partner with grocery retailers should teach their grocery retail customers how to open dark kitchens and offer their own branded meals.

Micro-fulfillment is going to grow in popularity. Every retailer needs to ask and answer this question: What is our micro-fulfillment strategy?

For more information on micro-fulfillment, you can read articles located here and here.

Read more articles like this from PULSE’s Chief Marketing Officer Brittain Ladd

A Worlds First for AMR’s in Manufacturing

A Worlds First for AMR’s in Manufacturing

OTTO Rendering
  • First deployment of OTTO AMRs at scale at an F500 company demonstrates clear benefits in productivity, cost savings, and robustness.
  • Analysis reveals that a single AMR unit represents just 10% of the equivalent human labor cost, 20% of forklift operating costs, 50% of conveyor costs and 66% of AGV costs.
For a number of years now, Autonomous Mobile Robots (AMRs) have been considered a promising technology for improving the resilience of manufacturing operations.

In the context of manufacturing, resilience means agility – the ability to react to and adapt to change at speed, whether it be in response to fluctuations in demand, market conditions, supply lines, the availability of labor, or otherwise.

The COVID-19 pandemic has tested the resilience of manufacturing operations worldwide like never before. Yet in the midst of the turmoil created by the biggest global crisis in 75 years, mobile robotics has been singled out as one of the most promising of all emerging technology sectors, offering a vital tool in the race amongst manufacturers to adopt COVID-safe, flexible, and digitized working practices.

Yet for all the optimism, manufacturing firms rightly ask one crucial question about AMR adoption – where’s the evidence that it will have the promised impact on my operations?

While there are plenty of examples illustrating the benefits of small deployments, the business case for full-scale adoption by large firms has been lacking robust evidence.

Until now, that is.

A World-First for AMRs

PULSE Integration partnered with OTTO Motors to carry out one of the world’s first large scale deployments of autonomous mobile robots for materials handling in manufacturing.

The project involved the deployment of the OTTO Materials Handling Platform to provide the backbone of advanced manufacturing and eCommerce intralogistics at an F500 company. It took place over two sites, a brownfield and a greenfield.

Brownfield deployment at an existing 700,000 square foot facility, half of which was given over exclusively to the use of AMRs to provide transport of raw material pallets, work in progress pallets, and finished goods pallets in place of forklifts.

Greenfield deployment at a brand new 1 million square foot facility, where AMRs were deployed exclusively in a 400,000 square foot area to collect materials from human pickers to take to automated machining cells, and also to perform autonomous collection of materials from automated cells.

By relying 100% on AMRs within the dedicated zones, PULSE was able to carry out a robust cost-benefit analysis in comparison with manual handling (use of hand carts or carrying good), forklifts, conveyors and also with Automated Guided Vehicles (AGVs), which run on tracks and therefore don’t offer the same freedom of movement as AMRs.

Clear Cost Benefits

1. AMRs vs. Forklifts

The findings were unanimously in favor of AMRs. At the brownfield facility, PULSE found the OTTO 1500 platform worked out at just 20% of the equivalent operating costs of forklifts. This was based on the calculation that a single unit operating around the clock, 24 x 7 x 52, cost $40-50k per vehicle per year. The equivalent cost of a single driver working 4.2 shifts per week, plus the forklift lease, comes in at $200-280k.

At the greenfield facility, PULSE deployed OTTO 100 units managed by the OTTO Fleet Manager IoT system. With an average cost of $15-25k per vehicle, the OTTO 100 represents just 10% of the labor costs of human drivers when compared on a 1:1 basis.

2. AMRs vs. AGVs

In comparison with AGVs, PULSE found that the overall productivity of the OTTO 1500 units was broadly similar and that AGVs even showed some advantage in wide-open spaces. However, in the tight, narrow spaces of a compact facility, the smaller footprint and better maneuverability of the OTTO 1500 showed clear performance benefits.

Freed from fixed paths and guideways, the AMR is, for example, able to navigate independently around obstacles and pedestrians and can maneuver flexibly within the footprint of a pallet. This makes it much more efficient when operating with work cells or production machinery. Overall, PULSE calculated that this gave the OTTO 1500 a 66% cost efficiency advantage compared to an equivalent AGV system.

3. AMRs vs. Conveyors

Compared with conveyors, meanwhile, which operate in fixed positions that cannot easily be rerouted as demands change, PULSE calculated that a single OTTO 100 unit could do the work equivalent to a 250 LF conveyor. This worked out as a 50% cost saving, although this was based on optimum loads. When conveyors, as so often happens, are sub-optimally loaded for throughput or when loading only happens sporadically, the cost benefits of the AMR can be even higher.

4. ROI

Finally, as well as significant cost efficiencies, PULSE’s analysis revealed that ROI on AMRs at this kind of scale could be as little as a year.

With payback driven by labor savings, increased productivity and efficiency, enhanced ergonomics, improved safety, lower capital costs (compared to conveyors) and the opportunity for more compact facility design (compared to AGVs), PULSE calculated that ROI for large scale deployments on system lease could be under 12 months.

Using vehicle-only lease, this would push up to 12-24 months, while upfront capital purchases would be typically paid for in two years or less.