By Clement Yew
Online grocery shopping has transformed the way consumers in Asia obtain their daily essentials. With the convenience of ordering groceries from the comfort of their own homes, more and more people are turning to online platforms to fulfil their grocery needs. Compared to 2019, the grocery delivery market is now over three times the size today in the Asia-Pacific region, with the segment projected to reach US$325 billion this year.
Down the supply chain, this surge in demand has presented a logistical challenge for retailers. Traditional grocery warehouses are struggling to keep up with the increasing volume of orders, leading to delays and unsatisfied customers. How then can businesses optimise their grocery warehouses to meet these newfound demands?
Traditional Grocery Warehousing
Before delving into how grocery warehouses can cope with modern demands, it is essential to understand how a traditional grocery warehouses function. These warehouses operate on manual labour and rely heavily on human workers to pick, pack, and ship orders. Although this system has served its purpose for many years, it is not equipped to handle the scale and speed required for online grocery shopping today.
Workers also spend a significant amount of time navigating through aisles, searching for products, and manually fulfilling orders. While this is a simple system that is easy to implement, this manual process is prone to errors which results in delays and in turn, dissatisfied customers.
Because this method relies on human contractors working within a physical space, there are limits to how many orders can be fulfilled at one time. This means online customers will face longer waiting times, which will often spur them to buy from a competitor.
Additionally, the traditional form of warehousing makes it difficult to have anyinventory visibility. In turn, it is tough for stores to keep an accurate inventory, which leads to escalating Out-of-Stocks. The increased online orders deplete inventory fast, and warehouse employees have issues keeping up with stock checking and its replenishment. Out-of-stocks are extremely damaging to customer loyalty and a reliable way to send consumers straight to competition.
With that, a wait-and-see approach is no longer feasible in today’s fast-paced digital economy. Consumers expect nothing less than efficient, reliable, high-quality service delivery both online and offline. Retailers recognise that to remain relevant and hold onto their competitive edge they need to invest in automation.
Automated Storage and Retrieval
An automated system for storing and retrieving inventory or products is known as an Automated Storage and Retrieval System (ASRS). These systems have been developed to replace shelving and manual methods of warehousing in traditional grocery warehouses. This innovative solution utilises robots to transport goods directly to workers, eliminating the need for manual labour. According to Zebra Technologies, 28% of decision-makers said that they have goods-to-person solutions today, and 89 % anticipate that they will by 2027. The top three labor initiatives reported by the decision-makers was to reduce unnecessary tasks so front-line workers can focus on customer-centric work, optimise the use of seasonal labor, and address worker comfort. The automated aspect of ASRS frees workers from the less-impactful parts of warehousing such as walking around the warehouse for picking, and allows them to focus on aspects requiring the human touch. In turn, this not only aids the business, but the worker’s quality of life as well.
The ASRS is highly versatile and can be customised to meet the unique requirements of each customer through the incorporation of cube storage, robotics, carousels, and shuttles. To effectively manage all these components and systems, a Warehouse Management System (WMS) is employed.
The implementation of an ASRS installation depends on factors such as the size and weight of the products in the warehouse. In the case of grocery warehousing, common household products and foodstuff can easily be contained within the system. Other elements such as storage structure design, physical automation capabilities, conveyance interface setup, and control software integration are also considered. By carefully analysing these aspects, a tailored ASRS solution can be developed to optimise efficiency in grocery warehousing.
Cube Storage and ASRS
Cube storage systems typically consist of a grid structure that serves as the framework for the systems. This grid holds storage bins and robots, which are responsible for navigating and transporting said bins that contain various products or stock items.
In terms of storage efficiency, cube storage surpasses other ASRS by making effective use of space. Unlike traditional shelving methods that leave empty spaces between items, cube storage eliminates this wastage by arranging products based on their popularity. The most popular items are strategically placed at the top of the grid to ensure faster retrieval times.
One notable advantage of cube storage is its modular design, allowing for easy installation and scalability. In fact, warehouses can increase their storage capacity by up to four times within the same footprint through cube storage when compared to conventional storage, creating high value for grocery warehouses who implement the design. Comparing cube storage to a conventional warehouse, it provides businesses with up to four times the storage capacity in the same footprint — offering the space to provide more services and inventory. With advancements in technology, virtually any grocery warehouse can be automated using ASRS systems.
Grocery Warehouses and ASRS
Modernising a grocery warehouse by implementing a ASRS brings about significant payoffs in meeting consumer demand. The benefits reaped by a modernised automated warehouse include labour, energy, and space savings – along with the all-important improvements to accuracy, productivity, and efficiency.
Within the region, Singapore’s largest supermarket chain—NTUC FairPrice, overhauled its e-commerce platform and was looking to meet demand for fast online service. Grocery Logistics of Singapore (GLS), its wholly owned subsidiary, consequently implemented an AutoStore ASRS to break away from traditional grocery warehousing.
Through an ASRS of over 55 robots and 20,000 storage bins, GLS gained the ability to handle up to 3,000 daily orders, increasing order fulfilment by four times when compared to the original method of traditional warehousing. The system makes work less arduous for employees, who now have no need to walk long distances to pick or print labels.
Elsewhere, e-commerce giants Amazon is another adopter of ASRS, where tests are currently underway in their soon-to-open grocery fully-automated grocery warehouse in the New York area.
An AutoStore ASRS has an uptime of 99.7% and gives 100% access to stock 24/7 with a 99.9% picking accuracy, allowing grocer warehouses prime inventory management and accurate grocery picking. In turn, this increases labour productivity up to eight times and allows warehouses to process up to 650 bins per picker every hour. Warehouses equipped with an AutoStore system will reap the benefits of a best-in-class ASRS that delivers a fast and highly reliable order fulfilment system—maximising space while fulfiling orders at record speed.
Automating for the Present
By optimising space utilisation and enhancing accuracy and productivity levels, ASRS systems offer an exceptional grocery warehousing solution.
These automated systems have revolutionised traditional warehousing practices while ensuring efficient operations in ensuring prompt order fulfilment in the era of e-grocery shopping. ASRS and cube storage are redefining grocery warehousing, enabling businesses to meet new challenges head on while improving the likes of space, order fulfilment, and worker welfare.
As shifting online for grocery needs becomes more prevalent year after year, automating is no longer the solution for the future, but for coping with the present.
Clement Yew is the director of business development SEA at AutoStore