The first snowflakes of the season are falling in many parts of the country, which means that warehouse operators and parcel carriers alike are hiring tens of thousands of temporary workers to cope with the demands of the peak holiday shopping season.
That task is proving harder in 2019 than in past years, as record-low unemployment rates are making it hard to hire enough workers to fully staff fulfillment centers. That's forcing employers to brace for a blizzard of overtime bills and to crank up the thermostat on an already hot job market by raising wages.
However, providers of warehouse robots say there's a better solution. Many robot vendors are now renting or leasing robots to their customers on a short-term basis, allowing DCs to ramp up their operations during peak periods and then scale back once the activity dies down.
There are several variations on the approach, but the most common is called "Robotics as a Service," or RaaS. These services are usually offered on a subscription basis, with customers paying monthly fees instead of buying their robots outright. In exchange, vendors deliver autonomous mobile robots (AMRs) and then provide tech support as well as regular updates to the hardware and software that enable them to navigate DCs.
BOTS KEEP THEIR HEADS IN THE CLOUD
Companies that choose the RaaS option are typically logistics or retail operations that are already using bots in their warehouses but need additional support during peak periods or in times of severe labor shortages, according to 6 River Systems Inc., a Waltham, Massachusetts-based warehouse robotics startup that offers its "Chuck" series of AMRs on an RaaS basis.
For operations with existing robot fleets, commissioning additional units is a simple matter, vendors say. Once a warehouse technician switches them on, the newly arrived robots connect to a DC's wireless network and link to critical information like an inventory floor map, the location of electrical outlets for recharging, and an interface with the building's warehouse management software (WMS).
The robots access that data but never download it from the cloud, so the only information physically stored on a robot is its own navigation software and collision-avoidance system, says Melonee Wise, CEO of Fetch Robotics, a San Jose, California-based AMR vendor that offers RaaS plans. If a vendor swaps out an older robot for a new one, it resets its onboard computer, ensuring that sensitive information on sales and customers never leaves the building, she says.
That approach makes it easy to add more robots to a fleet because every robot shares the same knowledge base, Wise says. In fact, warehouse managers often find the technical setup process to be easier than training their human employees to work with the new equipment, she adds.
"You have to have your workers be ready to interact with the new robots," Wise says. In past years, workers were sometimes afraid the robots would take their jobs, but the latest generation of workers is more likely to see robots as collaborative tools to help boost productivity. "The fear is no longer losing their job, but being competent enough to work with the robot," Wise said during a recent panel discussion on supply chain technology during the MHI Annual Conference in La Quinta, California. "So if you can disarm that as soon as possible, they transition to embracing their robot co-worker. And then they go from fear to curiosity."
ROBOTS ON THE RISE
Thanks to its rising popularity, the RaaS approach is helping to accelerate the adoption of robots in the logistics industry, reports Karen Leavitt, chief marketing officer at Locus Robotics, a Wilmington, Massachusetts-based AMR vendor that offers RaaS plans.
"[RaaS] is terrific for customers because it provides them with a low threshold to entry; you don't have to write a check for $1 million, just $10,000 a month," Leavitt says. For customers, it's a low-risk proposition because the pay-as-you-go service is considered an "operational expense" in accounting terms, as opposed to a purchase-based "capital expense."
"If it were a cap-ex purchase and then you have second thoughts, you've already bought it and it basically becomes a large paperweight in your facility," Leavitt says.
In addition to flexibility, RaaS plans offer users many of the same advantages as the popular Software-as-a-Service (SaaS) subscription-based software offerings, Leavitt notes. "So, like with SaaS, [you can] rely on the fact that you're going to have quarterly updates to the software. And you share a long-term business relationship," she adds.
According to Locus, that relationship is critical to helping warehouse operations deal with one of the most pressing challenges of the era—the labor shortage. "The macro problem we're addressing is labor availability and effectiveness," Leavitt says. "Because labor is unavailable, wage rates have been going up. So this allows [warehouses and fulfillment centers] to get the same amount of work done with half the labor."
Across the industry, warehouse automation vendors—including major players like Vecna Robotics, Mobile Industrial Robots (MiR), and InVia Robotics—are increasingly offering their robots on an RaaS basis, helping to bring bots into DCs of all sizes. By making those robots easy to "hire," simple to "train," and inexpensive to "rent," robotics-as-a-service has become a crucial tool for helping warehouse operators avoid getting snowed in by a blizzard of orders during the winter holiday rush.