Rising wages, a diminishing workforce and evolving shopping habits are all driving a major automation push in the warehousing sector.
UK food and drink storage systems have historically trailed behind continental Europe in mechanisation. However, a need to replace manual labour, and a trend towards more complex picking and handling procedures to serve multiple retail channels, are prompting the UK sector to play catch up.
Ahead of Brexit, many EU workers are “starting to go home, mainly because they've seen a devaluation in their wages” , says Chris Sturman, chief executive of the Food Storage and Distribution Federation (FSDF).
Between warehouse workers, administrative staff and lorry drivers, “we could find up to 500,000 people disappearing”, says Sturman. “Where are [their replacements] going to come from? If you haven't got the people to do it, then you've got to find a mechanised way of managing inventory and stock.”
Peter Ward, chief executive officer of the United Kingdom Warehousing Association (UKWA), also identifies a looming urban logistics crisis.
“The overriding message for the logistics industry, which historically has relied on an increased labour force to meet the needs of new client contracts, is wake up and smell the coffee automation and robotics are coming and you ignore them at your peril,” says Ward.
“Automation is stepping closer into the economic justification zone for more logistics operators that are juggling higher volumes, a growing demand for faster order fulfilment and greater value on the one hand, with rising staff costs on the other.”
A shift towards longer-term relationships between third-party logistics (3PL) providers and clients is also making payback on capital investment more viable, he says, while automation itself is becoming more scalable and flexible.
Mike Flynn, business solutions director at temperature-controlled food logistics network provider Gist, says: “In continental Europe, where labour costs have typically been higher, there has been a move to automating more processes pallet building, wrapping, picking and some of the shuttle-car transportation systems, and I think that is going to start to become more material in the UK market.”
Online shopping demands (back to top)
Cushman & Wakefield, a global commercial real estate services firm, published a report in June highlighting rocketing UK retail warehouse transaction volumes with online shopping driving competition for space.
“The online shopping explosion, which has forced many 3PLs to completely rethink much of what they do, is also contributing to the interest in automation,” says Ward at UKWA. “When ordering online, customers now demand a virtual audit trail of product whereabouts; from when their order is placed, right through to delivery.
“This requires a constant flow of information that transcends the supply chain at every stage of the operation and this can only be achieved through higher levels of automation and joined up services.”
Sturman says organisations such as FSDF and UKWA regularly engage with the commercial building sector to ensure new warehousing meets industry demands.
An emergent trend is urban consolidation centres, he says, with industry keenly watching Amazon as it expands into the grocery sector and is rumoured to be looking at 30 satellite sites around the UK.
“It's about how you get the actual stock as close to the consumer as possible, given that you don't want stock knocking around that isn't selling,” says Sturman.
The warehousing sector is also seeing retailers building their own mixed storage and cross-docking facilities, and specialist operations such as high-bay automated crane stores for high-volume goods.
Much of the core technology and applications used in warehousing today has been around for some time but is simply getting more efficient and cost effective, says Neil Adcock, consulting partner at Bis Henderson Consulting. Technologies, such as picking systems or even driverless vehicles, are becoming “easier to deploy” , he says, and “whereas a few years ago, your paybacks would have been quite long, that's now starting to reduce as a result”. Adcock has witnessed particular interest in autonomous vehicles following manual pickers around the warehouse floor to ease the labour burden.
Mobile device changes (back to top)
Chris Tozer, territory manager of Ivanti Supply Chain, identifies one of the most significant changes in warehouse management as a shift from green screen Windows CE which, from 2020 will no longer be supported by Microsoft to mobile Android devices for pick and scan.
Ivanti works with Zebra to integrate its advanced picking technology, such as TC8000 gun-type scanners aligned with next generation Telnet (an internet protocol) emulation and voice enablement.
Tozer reports increased uptake of Ivanti's Speakeasy voice-enabled picking product, as “voice solutions enable a much faster pick because they allow users to work hands free” , he says. “In a food-handling environment, voice enablement can be critical if workers are in a very cold/chilled environment and are wearing personal protective equipment that would make holding a device challenging and counter-productive.”
Warehouse management system provider Chess Logistics Technology, meanwhile, created cloud-based stock management application ProSKU to address market demand from small and medium-sized businesses.
“Retailers now routinely expect to place orders with their suppliers for delivery the following day,” says Alex Mills, sales and marketing director at ProSKU. “There are many reasons for this, including shortening lead times to remove inventory from the supply chain, lengthening on-shelf availability, reducing in-store storage, and generally improving customer service. These leaner supply chains leave little or no margin for error, which means manufacturers need robust warehouse management solutions to provide the levels of performance required.”
Heightened Safety focus (back to top)
As warehouse operations become more complex and fast-paced, safety issues are also heightened.
“With warehouse space now at a premium, specifications and configurations using diverse types of racking and shelving can make a massive difference to efficiency, productivity and profit,” says Jaap Vos, president of the Storage Equipment Manufacturers' Association (SEMA).
However, warehouse management needs to look beyond the price per pallet to calculate the return on investment (ROI), and look at “bespoke solutions, where all the variables are considered and included, so that a true ROI figure is arrived at”, says Vos. “Payback can normally be arrived at over a two-year period. The three key criteria to look for are a safe working environment, accessibility to pallets and minimising damage to products stored.”
SEMA has been closely involved in driving and promoting the safe design, installation and use of storage equipment, with its members being expected to adhere to rigorous quality controls and regulations.
“Regular onsite maintenance is the on-going critical element of operating a safe storage regime,” says Vos. “Companies that don't operate a structured approach to rack inspection and repair may risk invalidating their commercial insurance policy.”
Health and safety is also a concern for FSDF, which is currently focusing on staff training regimes, and the separation of manual workers and moving vehicles in warehouses.
A further feature of warehouse design and equipment continuing to evolve is energy efficiency, says Sturman. From the thermal efficiency of buildings to LED lighting, variable speed drives on evaporator vans, condensers, solar panelling and door closure mechanisms, features boosting site efficiency are in high demand.