26 June 2020

And just like that, the FY20 financial year comes to an end. What a year it has been! Here at Fuzzy LogX, the last 12 months have presented many great challenges to our business and I’m proud to say we’ve risen to the occasion. We have now doubled the size of our team and are working on world-class DC design and Improvement projects across a wide variety of industries and customers. We’re also now halfway through our Future-proof Warehousing webinar series with CeMat (Sign up here to the webinar series if you already have not) and it has proven a timely opportunity for us and our audience to review Warehousing best practice principles and technology. So we’ve been very busy.

And it does not seem to be slowing down. We have been working steadily through COVID (albeit largely remotely and from our home offices) and have continued to provide the personalised, professional and specialist consulting services that we are known for. What has been surprising are the number of new projects we have commenced or scheduled to commence during this unprecedented period in history. It seems that now more than ever, organisations are elevating the humble warehouse to Superstar status (see our previous article From Ugly Duckling to Black Swan) as they struggle to service their customer base in new ways.



The COVID effect

We’ve previously discussed how the lean thinking that was brought across by manufacturing professionals into the Warehousing profession exacerbated the bull-ship effect caused by the early ‘panic buying’ behaviours of the public and when we touched on this topic back in March, one of the key areas we identified would need to improve drastically was the direct-to-customer fulfilment strategy of all businesses. We’re still waiting for the figures to be released in Australia, but most businesses have seen between a 100% – 300% increase in online sales and this has really tested their ability to fulfill through their current distribution channels. Most large retailers have had to come up with tactical approaches to meeting this current demand and with the inability of traditional automated systems to increase capacity on a large scale, a lot of these tactical solutions have meant a large influx of additional labour force to meet client demand

I believe that this trend will continue and we are regularly hearing about businesses who are now considering a seismic shift to their previous operating models as the retail environment shifts online. Many businesses are now sitting around the board room table running over their physical retail stores with a fine-tooth comb in an effort to determine whether they will actually open the doors for these ever again. A lot of businesses had to run their existing stores as ‘Dark Stores’ over the COVID lockout period and when you’re paying premium dollar to do so in a Shopping Centre, it’s not long before you start re-thinking your strategy. Over the next 6-12 months, we’ll start to understand how the traditional retail players will adapt to these changing buying behaviours and I thought this would be a great opportunity to provide an update on some of the key technologies we’re seeing in our local market.




Micro-Fulfilment Centres

Last year, we put out a couple of Fuzzy Friday articles (click here for all the articles) on Micro-Fulfilment Centres (MFC) as it was a technology we identified that was being taken up at a rapid rate around the world. For those who don’t remember, MFCs are basically small automated fulfilment systems which use traditional ASRS technology to increase the fulfilment capabilities in the back of traditional bricks & mortar retail stores. This technology has been namely championed by the Grocery market across the globe, but has been recently linked to more traditional retail markets as well.  Well, we’re now just weeks away from having the first operational MFC in Australia.


Woolworths strikes first in ANZ.

Earlier in the year, Woolworths announced that they would be rolling out this new technology around mid-2020 to their first store in Carrum Downs, Victoria. We know that Woolworths have partnered with Take Off technologies who use the Knapp OSR shuttle system to power their MFCs. Undoubtedly, the solution delivery will have been impacted by COVID as it will be very difficult to get the Engineering resources from Europe to Australia to install and commission this solution. But needless to say, we are excited to hear about the formal announcement that this technology will go live some time later this year. This will mean that Woolworths will be the first to deploy this solution in the region and should pave the way for other grocer retailers to follow suit.


Other MFC news

Also, in the MFC space, we are seeing the profile of the solutions from the traditional technology providers increase with Dematic, Vanderlande, Swisslog all continuing to spruik their solutions and share updates on new customer partnerships to deploy around the globe. The interest in this technology has continued to increase as the year goes on. Another interesting topic which has come up recently in the rumour mill is that Fabric (Israeli Start-up previously known as Commonsense Robotics) may be looking to merge with Take Off in an effort to help take on the E-Commerce giant Amazon. We’ve covered the technology behind both of these solutions in the past and it would be prudent to watch this space to see how it all unfolds. Just like with autonomous mobile robotics technologies, small start-up businesses in the MFC space are able to compete with the large traditional vendors, however at some point it may make sense for some of these technology providers to merge with their closest competitors to share their resource pools and compete for the large end of town’s business.



Autonomous Mobile Robotics (AMR)

The AMR market in Australia has been receiving a lot of attention this year with multiple solutions suites coming to the market. We’ve already covered the presence of Geek+ (Cohesio Group), Mushiny (Priority Integrated Systems, Carrypick (Swisslog) and a couple of other small AMR providers who have been offering solution in Australia for a couple of years now. However, in 2020, there has been an influx of announcements which mean that Australia will now have increased access to AMR solutions from across the globe.

First of all, the Cohesio-Korber acquisition has increased the range of AMR solutions which they now have available to offer to our market. The Korber group has signed strategic partnerships with Fetch Robotics (Silicon-Valley based collaborative AMR solution provider), Locus Robotics (A business started by the founders of Kiva Systems after it was bought out by Amazon) as well as some other interesting technology solutions for this space including the AIC Systems AMR sortation solution. Congrats to them for increasing the exposure of this technology with the front page of MHD Supply Chain Solutions this month.

I have been following the robotic sortation technology quite closely ever since I came across the Tompkins Robotics solutions suite some years ago. This technology has the ability to really change the way business look at sortation with highly flexible and scalable solutions possible within this technology framework. It’s great to see such great technology getting the credit and exposure it deserves but it should be noted that Cohesio/Korber are not the only ones who are able to supply these solutions locally. Another key player in our market are Priority Integrated Systems who actually deployed the first 3PL AMR solution in the country in early 2019. They have also been building their capabilities locally both with AMR sortation (which they’ve had on offer for quite some time) as well as increasing their solution offering with HAI Pick who we’ve previously reviewed known as Kubo. Further to this, we’re now hearing from Dematic and some of the other large vendors, that they will be adding AMR offerings into their solution suite. We’ll be talking more about these solutions in the future, but long story short, we now have access to a lot more Mobile Robotic solutions and we’re involved in multiple projects which are now including AMR technology up against the traditional ASRS offerings. Make sure you do your due diligence and speak to multiple parties before signing on the dotted line.


Large-Scale Intralogistics Project update

One final note on the big announcement made this week by Woolworths about their Partnership with Qube. This is a landmark announcement and has really got everyone in the industry excited about what $1.2 Billion of investment will mean for the Intralogistics industry in Australia. The battle for the ultimate automated supply chain is well and truly on between Australia’s grocery giants Coles and Woolworths. Coles has already supposedly started building their new fulfilment centres, but have been quite shy about sharing many updates about either their Witron or Ocado technology and project development. Needless to say, the commitment from both these businesses to invest in both large-scale and small-scale automation across their network is probably the best indication of the uptake of this technology globally. The future is looking increasingly automated, and if you’re not thinking about how you could automate and improve your operation, you will quickly fall behind.



Jeffrey Triantafilo is a Warehouse Systems and Design Engineer in Intralogistics for Fuzzy LogX, an Australian boutique consulting firm, based in Inner-Western Sydney, focused on helping Warehousing and Distribution Operations improve and stay competitive in today’s ever-changing supply chain environment. If you’d like to have a chat with jT or one of his colleagues about improvements in your operation, click here.