Alvin Yap, sales director, Geek+ speaks with IAA on the current state of the logistics sector and trends in logistics automation.
The logistics sector has been increasingly in the spotlight due to the ongoing Covid-19 pandemic. Supply chain resilience has been seen as not just a matter for organisations but also countries who have struggled with meeting medical supply needs during this unprecedented time.
Here, Alvin Yap, sales director for smart logistics specialist Geek+ discusses technology trends in the logistics sector as well as the maturity of Southeast Asia’s logistics sector.
IAA: What are the trends, and how is the use of robots in logistics and supply chain changing?
Alvin Yap (AY): Some of the trends include but are not limited to automated storage and retrieval systems (AS/RS) due to money and technology reasons. AS/RS systems are an ‘all or nothing’ solution, which needs huge investment to build new warehouses and is not fully automated.
Furthermore, logistics operators are now looking for flexible and high ROI solutions with deep learning. Autonomous Mobile Robots (AMRs) are being adopted by supply chain players. The use of robots in logistics applications can reduce injuries to workers in mixed environments, while reducing product damage.
In regards to benefits, using AMRs in a warehouse can improve productivity by up to 300 percent and achieve 99.99 percent accuracy on items picking. A few types of AMRs applications for supply chain include person-to-goods, goods-to-person, sortation, and mounted arm.
The Covid-19 pandemic is driving the growth of AMRs in the supply chain and logistics industry. Furthermore, the proliferation of ecommerce and omni-channel brings a massive short-term spike and long-term acceleration across all industries.
Changing buying habits and higher return caused more kerbside or click and collect are driving its growth too. Its use also reduces manual and/or strenuous labour.
It is very apparent that E-Commerce has taken off in a huge way and is increasing at an alarming rate. Just look at the number of special promotion periods and days.
Just today I read in the papers that JD.com sold its stock of Huawei Handphones (allegedly 100 Million Units) in just 11 seconds after it went live despite the phones costing between US$750 to US$1,800).
And it was also reported that there are also options for 1-hour delivery time only. The tried and tested automated systems which have been around for more than 30 years were not built to anticipate such demands.
Demands driven by consumers where items are purchased piece by piece rather than in bulk. These consumer behaviour resulted in new requirements from the automation system.
Traditionally to cater to such demands or we call it ‘peaks’, additional labour was employed. For example in the US, Contract Workers were engaged to cater for the Christmas season period and then after that they started Black Friday and Cyber Monday.
These sort of demands can be as much as 800 percent above the normal average. And gradually it was realised that adding people is just not going to be sufficient due to all the issues associated – labour laws, onboarding time, accuracy of picks, people problems.
But the older system is also not built for such requirements and therefore Robots or AMRs started to become very useful to fill up this void. AMR solutions are very versatile, can be deployed ‘on’ and ‘off’, such as additional robots during peak and when peak ends, the robots are returned.
Implementation time is very very short and therefore very suitable for quick set up and quick demobilisation. And on top of that, AMRs typically get fitted with Artificial Intelligence Algorithms and Machine Learning Capability reducing tedious and repetitive calculations in order to get to an answer.
IAA: What innovations can we expect from the logistics sector in terms of automation and robotics?
AY: Some of the innovations that we can expect include automation and robotics with Artificial Intelligence (AI) as well as in Algorithms.
The keys elements for automation and robotics include:
- Intelligent robot – navigation, machine vision, control planning.
- Intelligent multi-robot scheduling – task matching, path planning, traffic management, online decision-making.
- Intelligent warehouse management – order management, inventory management, put-away policy, shelf adjustment.
- Intelligent supply chain services – 3D bin packing, replenishment recommendation, product selection.
IAA: What challenges do you expect the Southeast Asian logistics industry will face in 2021?
AY: Covid has created many problems as well as opportunities. However one of the biggest trends that we had seen is the rise of E Commerce volume. There is still consumption of Goods & Services but these have naturally moved towards platforms.
Take for example the rise of Zoom. And following the rise of Zoom, other meeting platforms became more utilised – Google Meet, teams, etc.
So the industry will need to pivot towards the current Covid Climate and bearing in mind the restrictions that come with Lockdowns as well as all the safety measures such as social distancing, not more than an x number of people per unit area etc.
And Post Covid, things will still take time to get back to a new normal and therefore companies which have already instituted a nimble system will be able to pivot with ease to new requirements.
Companies which have a cumbersome system will have difficulty. Truth be told. So there will be some who will continue to grow and there will be some which will have more difficulties. There is this thing called the ‘K’ Curve. I do see the Logistic Industry to be in a K curve sort of pattern
IAA: What is the current maturity level of Southeast Asia’s logistics industry and where are the opportunities for Geek+?
AY: The challenge for companies to choose automation has always been the cost versus traditional methods such as manual labour. Southeast Asia’s wages levels differ from country to country.
In the past automation solutions for warehouses typically had a very long payback period and only huge companies were able to afford it, leaving out the small and medium enterprises.
With the change in consumer demands, and the fact the AMR solution is a very flexible solution which results in a lower CAPEX: OPEX Ratio as compared to the older storage systems, this is a chance for businesses of any size to start taking a look at automated solutions again.
Geek’s Robotic Solutions typically has only a three year payback period. Sometimes more and sometimes less. We even have cases where the payback period is only 1.2 years.
Geek+ has a very unique value proposition for companies that are looking to automate and yet concerned with CAPEX and OPEX – RaaS/ Leasing which is basically a rental plan for additional robots to cater for peaks.
This means that the company no longer needs to decide at what capacity they should design their system for – average volume, 70 percent volume, peak volume etc.
They can design a system for peak volume, purchase the robots for average volume and then lease the additional robots as and when their business needs it. And in the future when the average volume increases, they can purchase just those robots.
IAA: What’s Geek+ strategy for growing market share across Southeast Asia?
AY: In terms of products we look to fit with eCommerce growth and besides picking robots, sorting robots will be our focus for our eCommerce customers.
We also look to launch our new shuttle robot – C200M, a double-deep bin-to-person picking solution. This will be our next generation of warehouse robots. It features high picking efficiency, high-density storage capabilities and narrow aisle design with fast implementation. It is also flexible to fit customer’s existing shelves and lofts, utilising existing racking and infrastructure
Furthermore, it is expected that smarter automation methodologies such as robotic automations will only evolve and be expanded to more and more industries.
For example, robots have already started cooking in restaurants. So sharing and educating both business owners as well as all stakeholders which includes the operational levels etc.
These developments help to make work easier for warehouse workers and make their work more meaningful and provides more value-add to the organisation.
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