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Robots Will Reshape Distribution Centers

March 31, 2023
The author believes the day when robotics become commonplace in the distribution industry is not far away.

This past summer while visiting a wholesale distributor’s distribution center, I watched receiving personnel spend an afternoon unloading boxes from a tractor-trailer in near 100-degree heat. This is even before the “stuff” is put away on the shelf. From the looks on their faces they were not happy, and you had to feel some empathy for the difficulty of the task and what was still to be done.

It suddenly occurred to me that instead of just thinking about how to design DC/warehouse space around robots, robots are now being built that are able to operate more on our terms, in our spaces and in our environments.

The situation I was observing just amplified how robotics are now being designed to handle the tough, often menial and accident-prone tasks at warehouses.

Robotics and particularly other forms of automation are not new to logistics. We have conveyor belts, scanners and other innovations that have helped automate and accelerate, for some decades now, the obsession for speed — characteristic of the distribution industry. But the pace of investment and change — fueled by the pandemic-era e-commerce boom, a tight labor market and a fragile supply chain — has really taken off in recent years. Most experts say robotics will change how warehouses are operated and designed. Some say we’re entering a golden era.

Actually, the seeds of the surge in warehouse robotics were planted during the 2008 recession, when carmakers, which depend heavily on robotics, dealt with a significant and prolonged downturn. But unlike repetitive assembly line manufacturing, warehouses demand a significant degree of flexibility.

Only recently have systems like visioning and artificial intelligence become cheaper and powerful enough to sort the tens of thousands of different products streaming through a DC or warehouse. This technological leap is part of a larger embrace of robotics. In fact, the robotics industry saw a +28% jump in purchases from 2020 to 2021, according to the Association for Advancing Automation. The technology is becoming more affordable and filtering down through the distribution industry, beyond the big players like Walmart and Amazon. It’s predicted that there will be a +25% increase in robotics and automation investment in 2022.

Although seemingly fueled by the distribution giants like Amazon, Walmart and others which saw logistics as ripe for innovation, they have helped supercharge distribution’s turn toward automation. Other large and small organizations with a large labor content also employ this strategy. They strive to make these jobs more secure and safer, while still being focused on using robotics as a cost-saving measure to reduce aspects of human labor. The wholesale industry has always been concerned with the cost of warehouse labor, but it has been hesitant to trim employees in a tight labor market.

Adoption of robotics in warehouses will increase +50% or more in the next five years, according to surveys taken by the Materials Handling Institute. The goal is the “mechanical orchestration” of workflow, in which a team of autonomous mobile robots (AMR’s), steered by sophisticated software and artificial intelligence, can move pallets, cartons and piece-pick products in a seamless environment — in collaboration with the appropriate positioning of warehouse associates. This strategy covers most typical warehouse functionalities from receiving and put-away to picking, order staging and shipping, as well as many other product transport requirements typical of distribution centers and warehouses.

I see a parallel in this adoption of technology in the media business. Netflix was the only company that could figure out streaming video, until suddenly it wasn’t. In a similar fashion, I see an emerging middle class of robotics users in the distribution industry. Other companies, of all sizes, will start to catch up.

There’s increased demand for “goods-to-person” robots offered by firms like Zebra/Fetch, Locus Robotics, 6 River Systems and Orange-Grey. These so-called co-bots, which can look like a bin-carrying Segway, move back and forth among workers throughout the facility, significantly reducing the walking for warehouse associates. With these robots also bringing cheaper and quicker ways to deploy, some robotics providers have even introduced “robots as a service” business models — leasing these machines to warehouse operators — reducing initial capital costs.

Moving forward. Automation is one major lever that companies can pull. Robots won’t replace workers in the near term, but rather make them more efficient and productive. Humans will be “crew chiefs,” commanding and maintaining teams of robots. Robots can also help with your worker recruitment while closing the generation gap among warehouse workers.

It will improve the quality of experience for the work force because instead of constantly walking and doing rote manual things, individuals will learn how to manage the robot to keep it up and running. It will create a career path and a more sophisticated skill set and make sure the evolution of jobs does not leave longtime workers behind.

Some experts believe “lights out” warehouses run by robots around the clock without requiring air conditioning or lighting will arrive in three or four years. I don’t know about that time-frame. But I do see a need for more companies in the distribution industry to evaluate the potential of robotics to increase efficiency and reduce costs and worker accidents. This could double throughput and reduce cost per transaction.

The urgency? I worry about the owners and senior operations managers who don’t pay attention to this fast-moving trend of robotics over the near-term. Why? Because, even today, many distribution centers and warehouses are just “racks, carts and a clipboard.” They’re just not going to be able to keep up with the service demands and cost factors to remain competitive.

Howard Coleman and his team at MCA Associates helps distributors and manufacturers implement continuous improvement solutions focused on business process re-engineering, inventory and supply chain management, sales development and revenue generation, information systems and technology, organizational assessment and development. MCA Associates may be contacted at 203-732-0603, or by e-mail at

[email protected]

About the Author

Howard Coleman

The author is the principal of MCA Associates, Derby, Conn., a management consulting firm founded in 1986. MCA implements continuous improvement solutions focused on business process re-engineering, inventory and supply chain management, sales development and revenue generation, information systems and technology, organizational assessment and development, and succession planning. You can contact him by phone at (203) 732-0603 or by e-mail at [email protected].

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