AutoStore picks New Hampshire for first U.S. office

Norwegian material handling automation provider AutoStore System Inc. today opened its first U.S.-based facility, saying it plans to use the office to host education and training initiatives supporting North American sales of its goods-to-person fulfillment system.

The Derry, N.H., location includes some 20,000 square feet of office and warehouse space, and will be used for training and demonstration activities for the company's dealers, as well as for storage and distribution of spare parts. The building currently houses six employees, but the company is planning to hire three more workers in coming months, according to AutoStore.

The site could also eventually host manufacturing activities, depending on the company's growth rate over the next five years, company executives said in a ribbon-cutting ceremony held at the location.

AutoStore makes a high-density storage system with inventory stowed in a grid of stacked, plastic bins. In response to orders from a user's warehouse management system (WMS) software platform, the system deploys wheeled robots that ride on rails erected above the stacks, retrieving and rearranging bins for delivery to work stations. Employees stand at each of those stations, performing fulfillment tasks such as pick, pack and ship, pick and place on conveyor, or replenishment.

Workers can be trained to use the system in just five to 10 minutes, AutoStore Business Development Manager Mark Hasler said in a tour of a demonstration system operating at the new facility. In comparison to alternative material handling systems such as shuttle systems, horizontal carousels, or mini-load cranes, the AutoStore product offers the flexibility to be deployed in nearly any type of building, high storage density, and low total cost of ownership (TCO), Hasler said.

AutoStore first announced its plans to open the facility in January, citing explosive growth in the U.S. market. Demand for AutoStore installations has been growing as retailers face growing e-commerce demand for fast delivery, at the same time that they are struggling to hire qualified laborers, he said. To meet that demand, many retailers are building DCs close to urban centers, and seeking automated material handling systems they can install in strip malls or converted brick and mortar stores, Hasler said.

Another reason for opening a U.S. facility is the company's broad, international footprint. AutoStore, which is headquartered in Norway and is owned by the Swedish private equity firm EQT Partners, manufactures its equipment at a factory in Poland. Opening a U.S. office will support greater communications with the firm's three sales partners, the systems integrators Bastian Solutions LLC (a unit of Toyota Industries Corp.), Dematic (a unit of Kion Group AG), and Swisslog (a division of Kuka Group).

AutoStore's business model is to act as an original equipment manufacturer (OEM) of its fulfillment equipment, while those partners handle all sales, installation, and support. That approach allows the company to reach a wide array of users, according to one of the partners who attended the event, Bill Leber, the director of sales for healthcare and pharma in Swisslog's warehouse and distribution solutions (WDS) Americas arm.

The "sweet spot" of the industry for an ideal application of an AutoStore system is a customer that has to handle a large number of stock keeping units (SKUs), demands piece picking for fulfillment, and needs to ship orders out of the DC within just a few hours, Leber said. Following that approach, Swisslog has sold dozens of AutoStore installations in the U.S., for customers including Indiana University's healthcare system, Johnson and Johnson, Medline, John Deere, and Boston Scientific, he said.