A spike in e-commerce volumes driven by coronavirus travel restrictions may slow down after a safe vaccine is eventually found, but its impact on fulfillment automation processes is here to stay, according to a top executive at Shopify, an e-commerce platform for small and medium-sized businesses (SMBs).
As the pandemic prevented consumers from congregating in brick and mortar stores, so many of them turned to e-commerce shopping that the online retail sector experienced five years’ worth of growth in the past three months alone, Shopify’s chief technology officer, Jean-Michel Lemieux, said today.
From less than 1% in 2000, the share of e-commerce retail sales as a percent of total retail sales rose to 5% in 2011 and 10% in 2018 before leaping above 16% during the second quarter of 2020, according to statistics from the U.S. Census Bureau.
That curve may soon begin to flatten a bit, but the post-Covid “new normal” will feature e-commerce levels in the range of 20%, 30%, or even 40% of all retail, Lemieux said in remarks at Flow 2020, the annual user conference held by autonomous mobile robot (AMR) vendor 6 River Systems.
Ottawa, Ontario-based Shopify acquired Waltham, Massachusetts-based 6 River in 2019 for $450 million in a bid to use its collaborative "Chuck" robots to boost fulfillment efficiency for warehouse staffers managing inventory for distribution. That deal looked at first like amazon.com's move to buy Kiva Systems Inc. in 2012 for $775 million, and then take the product off the market, keeping its robots for the sole use of Amazon’s own DCs. But Shopify was quick to say that it will continue selling 6 River’s Chuck bots to the entire logistics market, and Lemieux reiterated that stance today.
The deal has been critical to Shopify’s busy operations during the past quarter, which saw an explosion of activity to handle soaring pandemic e-commerce levels, pushing the value of goods sold on its platform in the second quarter to grow 119% compared to the previous year, reaching a high-water mark of $30 billion. Shopify earned revenues of $714 million on that business, recording a 97% gain over the same quarter last year, the company recently reported.
Powered by efficient warehouse robots, omnichannel commerce has never been more critical to retailers’ success than during the pandemic, Lemieux said. As coronavirus restrictions took hold, 70% of the brick and mortar stores selling inventory with Shopify’s platform saw declines in their gross merchandise volume (GMV) between March 13 and April 24, he said. But those that took their operations online were able to recover 94% of the lost volume, he said.
In order to keep those collaborative Chuck bots working safely with warehouse workers during the pandemic, 6 River has taken several steps to boost employee safety, 6 River’s vice president of product and analytics, Gillan Hawkes, said during the show.
In one instance, the company sent free cleaning supplies to every Chuck customer so they could wipe down the collaborative picking bots between shifts, Hawkes said. Other changes included issuing stylus pens so workers could avoid physical contact with the Chuck bots’ touchscreen tablet computers that guide people between fulfillment assignments, and tweaking the directions that Chucks drive down warehouse aisles to avoid close contact between employees, she said.