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The Future of Retail: How Robots and Drones Will Change the Industry
Global retail giants Amazon and Walmart are using artificial intelligence and robotics in ways that are transforming the retail industry. If one is to visit a typical Amazon distribution center, they will see chutes, ladders, conveyor belts and much more – but barely any humans. Currently, the human time required to get a package onto a truck is just one minute, and that number is decreasing.
Retail came to the market later, lagging behind manufacturing and agriculture. That changed when Kiva Systems, founded in 2003, developed robots who could bring items to workers. Amazon bought Kiva in 2012, which reduced its fulfillment cost by 20% and put the company significantly ahead of competitors. At the Amazon warehouses, Kiva robots, who can carry up to 340 kilos at once, and humans work together: for example, AI suggests box size; the worker places the objects in the box, which are then taped and postmarked by the robot. The robots have still not mastered grasping and placing, and humans perform that function.
And while the common fear is that robots will take human jobs, Amazon has shown that the opposite is true – for now. It currently employs 575,000 people, an increase by 235,000 from last year. Most work in the fulfillment centers and perform tasks that the robots cannot. It is possible that this will change once the robotic technology improves, and some companies – such as China’s e-commerce site JD.com – say that their goal is to have a fully robotic workforce.
Giants Amazon, Google and Uber – and a multitude of startups – are developing autonomous delivery drone.
Amazon is just one example of the shift in the industry, in which autonomous warehouses are merging with autonomous manufacturing to create a fully automated supply chain. Just as data is stored in the cloud, storage facilities are coming to resemble what’s called a “physical cloud.” That is, the warehouses look much more like data storage systems, with organisation that is targeted at robots. Instead of placing similar items next to each other, which would be intuitive for humans, multiples of the same item could be kept at various random locations to facilitate the robot’s work.
Ocado, the UK’s online-only grocer, is nowhere close to Amazon in terms of scale, but has surpassed it in the sophistication of is automation. In its warehouse outside of London, robots scurry around, grabbing the goods a customer ordered and placing them on a conveyor belt for the worker to pack. While no robot can currently pack items, Ocado trumps Amazon in its ability to use robots to autonomously move items from storage to conveyor belts. Behind this simple action is a complicated AI system run by Google that determines and optimises every aspect – and there are millions of them -- of order fulfillment: which items to get first and into which bags, which orders go on which trucks, optimal delivery routes and more. Ocado’s optimisation has paid off: it can quickly deliver groceries for about the same price as customers would pay at the physical store. Ocado is already looking into expansion – from future farming operations to resolving the bottlenecks the plague the container shipping industry.
It is not only storage of goods but delivery as well that has been affected by the technological innovations. Giants Amazon, Google and Uber – and a multitude of startups – are developing autonomous delivery drones. Amazon and Walmart are working on a self-driving van, which is really a general description for any sort of an autonomous vehicle. For example, Mercedes-Benz developed an autonomous electric skateboard chassis that can be used to transport passengers and also haul a shipping container. On the other hand, small delivery pods could deliver packages and orders using AI. Drone deliveries have already begun in rural China, Iceland and remote parts of Africa, but it is much more difficult in densely populated locations. So automated AI systems on wheels are likely to be the next step in the technological development of the delivery systems.