Dive Brief:

• Canadian retailer Hudson’s Bay Company has announced a new robotic fulfillment system for its Scarborough Distribution Center near Toronto that will use automated distribution technology to improve e-commerce fulfillment processes.
• The Perfect Pick case shuttle system was deployed as part of a $60 million upgrade to the distribution center, and is estimated to be 12 to 15 times faster than manual processes at moving inventory around the center.
• HBC also claims its new system can fill orders three times faster than other distribution center robotic systems.

Dive Insight:

HBC's system features 16 200-foot long aisles, can hold more than a million units of inventory and can process roughly 4,200 customer orders per hour. Two custom-built document handling robots automate insertion of packing lists, while 15,000 feet of conveyor and a fleet of approximately 300 autonomous robotic delivery vehicles — iBOTs — move inventory for storing and shipping.

The effect of adoption of robotics technology by companies in the retail ecosystem is getting to be a fairly sensitive issue, and with some evidence to support growing concern. For example, Forrester Research predicted a couple of months ago that use of robots would eliminate about 6% of all human-staffed jobs by 2021.

HBC was careful to point out that it has not had to lay off any employees as it has brought the new system online in recent months, though the retailer acknowledged it probably will not hire as many new fulfillment employees during busier shopping periods as it once had. The distribution center has about 300 full-time employees and plans to hire about 200 to 300 for the holidays this year, but the latter range is down from about 600 to 700 last year.

Yet it's impossible to dispute the advantages of introducing more robotics technology, especially where retail fulfillment is concerned. HBC said that Perfect Pick can locate and ship an item out of its center in 15 minutes that otherwise would have taken a human employee on foot about 2.5 hours to locate and ship.

HBC joins a growing list of retailers that had to make what was probably an easy decision from an efficiency and financial point of view, but somewhat harder from a human resources point of view — or maybe not, as companies that have made this sort of move have tended to focus public statements on all of the benefits of robotics, and not much at all about the process of deciding to use the technology.

In any case, Amazon led the charge adopting robotics in its fulfillment phases, using systems and technology from its Kiva acquisition to aggressively roll out fulfillment robots in 2014. In April 2016, a survey found that 35% of companies already had adopted robotics in their supply chain to improve efficiency, and about 51% of survey respondents said that use of robotics and automation would be important to disruption in their specific business sectors. 

We can pretty safely assume those percentages have only grown in the last seven months, and that in retail, where fast shipping is becoming a bigger factor than ever, they are even higher.