Three Steps Toward Solving the $120 Billion eCommerce Returns Problem
The new AI-enabled Reverse Logistics solution helps eCommerce retailers and 3PLs …
The Berkshire Grey team participated in MODEX 2022, the first major in-person U.S. supply chain experience trade show in two years, where the material handling industry showcased innovation to more than 37,000 attendees. This year’s MODEX event featured more than 850 exhibitors presenting a wide range of manufacturing and supply chain solutions. Attendees viewed cutting-edge technologies and learned about the latest trends in the industry.
Attendee excitement and the positive response to the three new robotic automation systems we demonstrated were contagious.
1) Robotic Shuttle Put Wall with Identification
This robotic product (BG RSPWi) is an automated put wall that integrates with existing eCommerce fulfillment processes to sort customer orders. The fulfillment process starts with batch-picked totes of diverse items arriving at the station. Next, an operator scans and places items onto an induction conveyor. The system then automatically shuttles and sorts items into order locations. The shelves light up to indicate completed orders, and an operator removes them from the shelf and packs them for shipment. The system delivers up to 300% improvement in sortation productivity, and because it supports larger batch sizes than manual sort walls can process, customers also experience up to a 30% improvement in the upstream batch-picking efficiency.
2) Robotic Pick and Pack with Identification for eCommerce Autobagging
This robotic product (BG RPPi) works with industry leading autobagger technologies to autonomously package eCommerce orders. The fulfillment process begins with totes of mixed SKUs that arrive at the packing area. Next, the RPPi system uses an industrial robot outfitted with advanced machine vision, sensor arrays, and AI software. The robotic system picks individual items, identifies the product barcode, orientates the item to safely and efficiently deposit it directly into a bag, and then does the placement. The BG RPPi passes the item identification information to the autobagger machine which bags, boxes, or wraps each item, sealing and labeling the package for shipment. Finally, the system conveys the finished packages to shipping.
3) Mobile Robotic Sortation
Our mobile robotic sortation product (BG MRS) enables dynamic any-to-any induct-to-discharge sortation that turns any floor into a dynamic unit sortation system. BG MRS can sort nearly any type of case, item, package, and order container, including non-conveyable products like cases of water and large bags of pet food. The sortation process begins with goods getting inducted into the sortation field through FlexFeeds located on the periphery of the floor. Mobile FlexBots that work as an orchestrated fleet then transport the goods from induction points to buffer storage and then on to desired discharge points in an intelligent sequence, enabling any-to-any point-to-point sortation. Finally, the system discharges (via FlexFeeds) items, cases, and containers to conveyor systems or manual workstations to build store aisle-ready pallets or load delivery vans in route sequence.
Chief Scientist Dr. Matt Mason and VP of Marketing Pete Blair led a speaking session at MODEX titled, “Robotic Pick, Pack, and Sort Systems at Fortune 50 Retailers Fill the Labor Gap.”
This well-attended session covered the difference between automating tasks and automating processes and how organizations can get started with robotic automation. Modern robotic systems can transform picking, sorting, packing, and shipping for a wide range of industries. It can also help organizations solve labor challenges and increase throughput.
Our team had some key learnings at MODEX 2022, such as:
We look forward to participating in ProMat 2023 and encourage everyone looking for innovative manufacturing and supply chain solutions to attend.
Berkshire Grey’s portfolio of robotic automation solutions includes Robotic Package Sortation and Identification, Robotic Shuttle Put Walls, Robotic Shuttle Product Sortation, and Mobile Robotic Sortation and Fulfillment. Berkshire Grey’s automated solutions are modular, flexible, and available via Robotics-as-a-Service (RaaS) implementation models, allowing customers to accelerate the adoption of automation technology without upfront capital expenditures. For more information about BG’s latest Robotic Product Sortation solution, visit here. To learn more about Berkshire Grey and RPS, please visit BerkshireGrey.com and follow Berkshire Grey on Facebook, LinkedIn, Twitter and YouTube.
The new AI-enabled Reverse Logistics solution helps eCommerce retailers and 3PLs accelerate resale of returned goods by reducing the processing time up to 25% with robotic automation
The speed with which eCommerce vendors delivered all our goods this holiday season put smiles (mostly) on millions of faces—both ours and those of vendors. But for vendors, there’s often a steep price: returns. Close to 30% of all eCommerce orders are typically returned by consumers. Projections indicate that by the end of January 2022, consumers will return approximately $120 billion of goods following the holiday season.
Keeping consumers happy while preventing returns from eating into profitability is the daily challenge of reverse logistics, an intensive, particularly labor-bound process that basically reverses the fulfillment process. With additional challenges like non-uniform packaging of items returned by consumers and the extra step of goods inspection before items can be returned to inventory for l resale (or other dispensation). Think fulfillment but with more quirks and exceptions.
This makes those “free and easy” returns for customers anything but for eCommerce retailers and 3PLs that handle returns. Free, no-hassle returns are a major driver of eCommerce growth, particularly in categories such as apparel, footwear, electronics, and luxury items, and a differentiator in the customer experience. However, the average cost of an e-Commerce return, regardless of item value, ranges from $20.75 to $45.25, when factoring in the costs of transportation, processing and markdowns/liquidation to resell. To reduce the impact of these costs, retailers need to focus efforts on increasing the resale of previously purchased goods. All of this cuts into the retailers’ profitability.
But it doesn’t have to be so painful —not anymore. The priority for eCommerce retailers today after reducing returns from happening (which may be a pipe dream, to some extent, given consumers’ habituation to easy returns) is getting resellable merchandise back on shelves as fast as possible while optimizing labor utilization. No easy task.
By automating reverse logistics processes using AI-enabled robotics, eCommerce retailers can reduce the time to recirculate returned items back onto the shelf and optimize labor productivity, ultimately improving profitability. Follow this three-step approach:
Step 1: Deploy robotic automation to receive and bulk-sort returned packages. Robotically pick, identify, receive, sort, and containerize large assortments of eCommerce packages prior to inspection. Returns will move faster from Receiving to Inspection, the latter of which is now more efficient because you’ve already sorted the returns by brand, category, or other key business identifiers. Enjoy even more efficiencies by, for example, automatically triggering return package receipt confirmation without having to touch the individual packages. Any time you can avoid or reduce manual handling of returned packages is a big win, obviously. AI-enabled robotics broadens the opportunity.
Step 2: Automate the return-to-inventory process. Next, robotic put wall systems streamline the sorting of individual items for fast restocking or other dispensation. Automated put walls have shown that this step can reduce sorting labor by up to 70%, improve individual item sorting throughput by up to 3X, and shorten the time to get goods back into inventory or moved to refurbishment up to 25% faster than manual processing.
Step 3: Optimize and fine-tune your new robotic returns workflow. This more than anything else can give you a competitive advantage over others who’ve discovered the transformational power of AI-enabled robotic automation for reverse logistics. Take advantage of the increasingly advanced robotic technology and systems-integration expertise available today to integrate best-in-class components into a solution that fits your reverse-logistics process to a T. Continual attention to workflow with data-driven analytics can help you get the maximum value when integrating automated and non-automated steps–for example, to minimize exception handling and other cost-sinks.
The more intelligence and responsiveness you can build into the steps above–this is where AI really comes in–the more you’ll change the equation for eCommerce returns and turn a negative into a positive.
Berkshire Grey, the leader in AI-enabled robotic solutions that automate supply chain processes, recently announced the availability of its solution for reverse logistics. The solution speeds up returns processing to get goods back into inventory or moved to refurbishment up to 25% faster than manual processing. In addition, the solution reduces processing costs by improving labor handling efficiency by up to 35%. Berkshire Grey’s Reverse Logistics solution includes its Robotic Product Sortation with Identification (RPSi) and Robotic Shuttle Put Wall (RSPW) systems, both of which are specifically configured to efficiently process returns. Both systems improve labor utilization and speed up the overall returns handling process to make returns less costly and ultimately more valuable to the sellers.
For more information on Berkshire Grey’s Reverse Logistics solution, download the solution brief here.
Robotic Product Sortation autonomously picks, sorts, and packs millions of items per month with higher speed and throughput while increasing fulfillment by up to 2X – without adding labor
Retail store replenishment, eCommerce, and B2B fulfillment operations face continued pressure from the double whammy of escalating, unpredictable consumer demand and shrinking labor pools. Even the best automation is being put to the test as suppliers grapple with processing potentially infinite order volume and variety out of finite and fixed facility footprints.
The solution is obvious but it’s been elusive: reliable autonomous automation for order fulfillment.
Berkshire Grey, a leader in AI-enabled robotic solutions that automate supply chain processes, closes this gap with Robotic Product Sortation (BG RPS) for order fulfillment. This high-capacity automation solution robotically picks, sorts, and packs individual items into outbound order containers without the need for operator interaction.
To see how RPS transforms one of the more challenging fulfillment operations – retail store replenishment – see this infographic.)
Berkshire Grey has taken some inspired approaches to get more product out of current fulfillment operations, which are limited by facility size, process complexity, and reliance on hard-to-find labor resources.
This next generation of BG RPS includes a unique dual wing design that increases speed by over 25% and doubles the simultaneous order processing capacity. This approach augments human labor to provide additional order processing capacity in existing operations and facilitates lights-out warehouse operations for suppliers looking to fully transform fulfillment operations.
Currently deployed at multiple Fortune 100 retailers, RPS addresses some of the most labor-intensive processes BG customers face in their fulfillment operations. BG RPS systems easily integrate into existing operations to process growing eCommerce and less-than-case order volumes to help fulfillment operations overcome labor scarcity issues. The systems are compatible with the broadest range of products, packaging, and order types including health and beauty items, apparel, electronics, housewares, packaged food, childcare products, pet care, office supplies, toys, medical devices, pharmaceuticals, and other general merchandise items.
Berkshire Grey’s RPS solution is a fully integrated system powered by BG’s core AI-enabled Software Platform, which underpins all of Berkshire Grey’s robotic automation solutions. The BG solution delivers best-in-class SKU coverage, real-time picking accuracy, and unparalleled autonomous throughput that enables distribution centers to double their order processing capacity without adding labor. The systems can be used as stand-alone modules, in conjunction with other advanced Berkshire Grey technologies, e.g., mobile robots, or integrated with leading ASRS solutions from multiple suppliers. The modular design allows enterprises to scale the number of simultaneously fulfilled orders into the thousands and the number of items robotically picked per week into the millions.
Berkshire Grey’s portfolio of robotic pick and sort solutions also includes Robotic Package Sortation and Identification, Robotic Shuttle Put Walls, Robotic Shuttle Product Sortation, and Mobile Robotic Sortation and Fulfillment. Berkshire Grey’s automated solutions are modular, flexible, and available via Robotics-as-a-Service (RaaS) implementation models, allowing customers to accelerate the adoption of automation technology without upfront capital expenditures.
For more information about BG’s latest Robotic Product Sortation solution, visit here.
It’s exciting to consider the throughput and productivity gains that robotic automation can deliver, but don’t forget to include employees in automation planning. Sharing plans and soliciting feedback from workers can help offset feelings of fear and resistance.
The retail industry is enjoying rising store sales and record eCommerce order volumes. This economic reality impacts many businesses including retailers and grocers, as well as logistics providers and package carriers. At the same time, these industries are hampered by supply chain problems and labor shortages. Robotic automation can help businesses maximize opportunities and mitigate challenges. But there’s one element of robotic automation that shouldn’t be underestimated: the human factor.
As technologists, we tend to focus on the mechanical elements of automation. Our robotics solutions are engineered to bring efficiency to overtaxed fulfillment environments with minimal disruption. They can be easily integrated with existing systems, and they scale modularly so companies can add capacity to fulfillment centers as needed. They fit into existing sites and eliminate bottlenecks by streamlining high-touch processes with intelligent automation.
In the big picture, though, the cultural implications of robotic automation are just as important as what the technology can do. If employees aren’t on board with automation initiatives, the likelihood of failure goes up significantly. Here are five tips that can help businesses succeed with automation initiatives.
1. Communication is critical. It’s important to share information about what will be automated, how the automation will impact operations, and what the timeline is. Employees often feel threatened by automation because they feel excluded from the plan and assume their jobs are at stake. Involving workers in automation planning can help ease their worries and keep them from being distracted by job security concerns.
2. Secrecy doesn’t help an automation project. Rumors and false narratives spread when information is withheld, which can lead to workers leaving. We’ve seen with our customers that transparency is far more effective than secrecy. Being transparent allows business leaders to explain how automation technology can make a positive impact, not only on the business but also on working conditions and employees’ career paths. It also gives workers time to prepare for upcoming changes rather than feel blindsided.
3. Trepidation can appear at any level. It’s not only the people who work in warehouses and distribution centers, whose roles may be displaced by future robotic automation, who worry about the impact of automation. Managers, too, can fear a loss of control if the processes they oversee may be impacted by transformative technologies that they don’t yet understand. Make sure your communication strategy is inclusive and targeted at all levels.
4. Be honest. Some leaders understate automation plans because they don’t want workers to panic and look for other jobs. But piecemeal, disconnected automation efforts lead to fragmented, siloed technology rollouts. It’s far more important to craft a comprehensive automation plan that’s thorough enough to address workers’ concerns and includes provisions for staff whose job roles may be changing. The plan should explain the potential for new technologies, in the appropriate context for workers and managers.
5. Think long-term. From a technology standpoint, projects are most successful when they’re conceived, developed and budgeted as part of a long-range plan that balances short-term gains with big-picture strategy. From an employee perspective, the same holds true. Having a long-term vision allows retailers to solicit input from employees and partners and plan for how job roles may change and evolve as automation technologies are deployed. It’s also a chance to focus on possible benefits to workers and the potential for skills enhancements.
For many businesses with warehouses and distribution centers, the biggest problem they face today is retaining labor. These companies aren’t trying to cut jobs — they’re desperate to fill them. Automation is meant to augment the labor they have, not replace it.
It’s a misconception that automation always leads to widespread job elimination. But if you’re only talking about your robotic automation projects behind closed doors, you’ll be breeding rumors and distrust. Talk to stakeholders at all levels about how technology can improve the way things are done. Yes, job roles may change as automation grows. With the right planning, they’ll change for the better.
Consider robotic automation which can take the load off the most labor-intensive parts of eCommerce fulfillment, store replenishment and allocation order processing. These tasks tend to be repetitive and not all that interesting for most workers. You may be surprised at how positively your staff responds to new automation approaches when they are part of the implementation processes.
Learn how robotic automation can lower costs and fulfill order by up to 3x faster
With a limited labour pool, UK businesses must find innovative ways to avoid supply chain disruption as peak season is underway. Robotic automation is the answer.
With the peak holiday shopping season on the horizon, there are increased concerns across the UK distribution and logistics industry that ongoing issues might have a significant impact on both retail profitability and customer satisfaction.
Demand for physical products skyrockets during the festive period. With the global health crisis still making waves across almost every business sector, there is a very real fear that a combination of labour shortages, supply chain bottlenecks, increased eCommerce activity, and the post-Brexit landscape could produce what The Guardian referred to as “a perfect storm” of high demand and restricted supply.
According to Reuters, British warehouses are facing an unprecedented labour shortage in 2021. The completion of Brexit aside, the media has been filled with stories about how the current staffing deficiencies in the logistics network threaten to both put the industry under pressure and, potentially, derail Christmas. Specifically, staffing shortages include a lack of experienced warehouse workers.
In an interview with Business Insider, Clare Bottle (CEO of the UK Warehousing Association) said that the “problem is big. I would say that we are tens of thousands short.” Most of the association members are having to offer pay increases of anywhere between 20% and 30% to secure a workforce for the peak season, with many entry level jobs taking up to four weeks to fill. Equally, traditional agencies used every year in the run up to peak are unable to plug the shortfall with temporary labour as that too is in very short supply.
The question we need to answer is how can companies ensure that their customers are getting what they want, when they need it. The widening gap between job openings and applications is likely causing sleepless nights for not only the logistics industry but also retailers — the latter starts planning for peak season about 10 minutes after Big Ben has chimed in the New Year.
The simple answer to the question posed would be that integrating automated technology to drive an increase in fulfillment that they are unable to achieve right now with current resources would be the ideal solution. Supplementing the UK workforce with intelligent automation that can operate on a 24-hour basis and, essentially, keep up with customer demand, warehousing leaders can navigate the short-term demands of a UK peak season. Now is the time to set a path toward an efficient and effective robotic workforce that augments the existing workforce, helping businesses meet demand with the resources they have.
Here we are at the start of peak season, and the supply chain issues are already showing their impact. Warehouses cannot fill vacancies, eCommerce demand continues to strain fulfillment operations, and consumer demand will only accelerate. There is a very real danger that companies will be playing catch-up all the way to Christmas and beyond.
In hindsight, 2020 was a challenge, and many companies weathered the storm. This year, there isn’t any wiggle room; consumer expectations continue to demand more product availability and faster delivery. While navigating peak 2021, savvy business executives will realize now is the time to plan for a more predictable and productive peak season in 2022.
Berkshire Grey’s holistic approach to advanced automation and intelligent robotics alleviates the pain points for companies today. By integrating our AI-enabled technology with their work processes, we are able to help companies increase throughput while lessening the dependency on additional labour. The pandemic showcased how the fulfillment, distribution, and logistics sectors needed to evolve. And while that won’t happen overnight, understanding where intelligent robotic automation technology fits into the picture is a great start.
Retailers have always had to balance their priorities when it comes to the end of the financial year, but they are largely dependent on the distribution and logistics systems working in the way that it was intended to. In the warehousing sector, that means having enough workers to do the jobs required. As we are more than aware, those workers are becoming very difficult to find. Therefore, alternative solutions are required in preparation for 2022 and beyond.
Robotic product sortation can help retail fulfillment centers increase piece pick order fulfillment by up to 4X, improve container cube utilization by up to 10%, and handle nearly 100% of typical SKU assortments.
Retail, grocery, and 3PL businesses strive to keep stores stocked with products customers want while also meeting demand for more online orders than ever before. Despite global eCommerce accounting for nearly 20% of retail sales, more than 80% of buying still occurs in physical stores. In many cases, retailers must maintain in-store inventory to not only address in-store shoppers but also to fill eCommerce orders directly from stores. These realities demand more efficient, cost-effective approaches to store replenishment and store allocation fulfillment processes in distribution centers
This week, Berkshire Grey announced the general availability of its Robotic Shuttle Product Sortation (BG RSPS) solution that can help retail, grocery, and other businesses significantly improve store replenishment and allocation order processes. BG RSPS is a fully integrated system powered by AI software that enables distribution centers to process more orders at existing facilities while requiring significantly less labor. BG RSPS enables retailers, grocers, and 3PLs to increase throughput, and drive growth despite labor shortages. Already deployed across major retailers, BG RSPS has the ability to:
Here’s how retailers and grocers can benefit from BG RSPS.
BG RSPS can perform tasks associated with store replenishment, split-case cross docking, and allocation order processing. Without a robotic automation solution, these processes require significant labor to complete the tasks needed to fulfill orders. Manual sorting operations are very labor-intensive, but even traditional semi-automated pick modules require more labor than the shuttle sortation approach. With BG RSPS, a single operator takes individual items or split cases from inventory containers and places them to induction points, and the system automatically sorts the goods into up to 60 outbound containers for shipment to stores. The result is a 4X boost in piece pick order processing along with an up to 10% increase in order container cube utilization.
The flexible footprint of BG RSPS lets retailers install stations wherever they have 2500 square feet of space, including on a mezzanine. As requirements change, retailers can scale throughput simply by adding orchestrated parallel systems without taking up significantly more space. Over the long term, robotic shuttle sortation systems provide an innovation pathway that delivers intelligent enterprise robotics — modular, flexible, and able to grow with each customer’s business.
An AI-driven sortation system also frees employees from having to walk back and forth, reducing worker fatigue and supporting social distancing protocols. Instead, workers use an ergonomic workstation, easing the strain of repetitive tasks and putting the products on induction points that allow the system to automatically sort the goods into store-bound containers. The BG RSPS system enables retailers to transform distribution operations into a competitive advantage while enabling increased throughput in the midst of the ongoing labor scarcity.
Increased demand and labor shortages are here. Robotic automation can help.
To capitalize on strong holiday sales, retailers need to continue executing on supply chain transformation projects without disrupting operations.
Peak season always brings a mix of angst and opportunity. This year, tensions are running higher than usual as the retail industry grapples with hiring issues and production problems across the supply chain.
Stories about scarce labor, material shortages, and factory shutdowns are making headlines nearly every day. Factory shutdowns overseas are impacting shoe production for Nike, and soaring freight costs are hampering companies like Costco.
Retailers are used to seasonal surges. They stock up, bulk up, hire up, and go all-out to meet demand and satisfy customers. It’s the defining season for the industry. Everyone knows it’s coming, and everyone prepares. Plus, retailers have been weathering the impact of COVID-19 for more than a year, so they’ve gotten adept at dealing with fast-climbing eCommerce volumes and consumer expectations for multiple fulfillment options and short delivery windows.
Still, the stakes are high.
Holiday retail sales are likely to increase between 7% and 9% in 2021, according to Deloitte’s annual holiday retail forecast. That translates to holiday sales totaling $1.28 to $1.3 trillion during the November to January timeframe, according to Deloitte’s retail and distribution practice.
Specific to eCommerce, Deloitte is forecasting 11-15% growth, year-over-year, in eCommerce sales, which are projected to reach between $210 billion and $218 billion this holiday season.
To capitalize on strong holiday sales, companies need to stay focused on their efforts to streamline operations. Supply chain transformations are well underway at leading retailers, and the efficiencies they’ve gained have helped to offset the impact of the biggest ongoing challenge: attracting and retaining staff.
Despite boosting wages and offering a slew of perks, including sign-on and retention bonuses, retailers can’t find enough people.
Cloud-based talent specialist iCIMS, in its latest workforce report, finds that retailers face a widening gap between job openings and job applications. In the retail industry, there’s been a 44% decline in applications per opening since the start of the year, compared to a 19% decline across other industries. And the time to fill positions is lengthening: It now takes 40 days to fill a retail position, an increase of more than 21% since April, iCIMS reports.
Labor isn’t the only challenge. Omnichannel expectations are high among consumers. They want shopping alternatives, speedy delivery, curbside pickup options, and more.
Retailers have long had to balance dueling priorities when it comes to peak season. They need to continue to plan and execute major technology enabled solutions that will position them to streamline operations and increase profitability. At the same time, they don’t want to interfere with the biggest shopping season of the year.
Now more than ever that balance is critical. No one wants to lose momentum on transformational supply chain automation projects, yet no one can afford to disrupt internal operations when external supply-chain factors beyond their control are already making it hard to do business. Advanced automation can help companies transform their store replenishment and eCommerce fulfillment operations *and* deal with labor shortages. The key is choosing projects strategically so that retailers can improve efficiency — freeing labor to focus on higher level activities — in a short time frame.
At Berkshire Grey, we can help you identify advanced automation and robotics projects that will yield short-term gains and fit into a long-range roadmap for expanding automation capabilities. Some of the benefits of partnering with us include:
Modularity: Our systems are designed for modular deployments, and they’re designed to integrate with traditional warehouse automation systems. A robotic shuttle put wall, for example, can speed sortation throughput threefold, and it slips right into existing fulfillment spaces and processes.
Flexible purchasing options: Our robotics-as-a-service offerings are designed to ease capital expenditures. Rather than buying equipment outright, RaaS offers a means to get up and running, for a fixed monthly fee.
Continuous improvement: We can help you develop a business case for robotic automation, build a timeline for getting underway, and deliver results. But it doesn’t end there. With our analytics capabilities, we continue to look for ways to fine-tune systems and improve performance even after our technology is deployed.