“The Rise of Robotics as a Service” was counted among the retail logistics trends to define 2020. The combination of advances in technology and a new business model of offering the use of robots without requiring their purchase is putting robots within reach of more businesses than ever before.
Last April HPE’s Chief Technologist, Manufacturing, Automotive & IoT, Matthias Roese spoke with Ronald van Loon about how: Robotics-as-a-Service (RaaS) enables businesses to capitalize on cloud computing, IoT, and efficiencies from a scalable solution.
A New Model and New Perspective
“Last year over one million quarter-inch drills were sold – not because people wanted quarter-inch drills but because they wanted quarter-inch holes.” That observation about what people really want to achieve from their purchases has been ascribed to Harvard marketing professor Theodore Levitt who credited it to Leo McGivena.
What the RaaS model does, essentially, is remove the requirement of buying the drill in order to achieve those quarter-inch holes. Instead businesses pay for the service of getting those holes drilled without having to own the equipment used to make them.
For retailers, that translates into getting the robots they need to move things around their warehouses as needed to manage orders and returns even during peak holiday times. What they pay for is not the robots but the improved logistics within the warehouse.
Averting Mishaps and Customer Frustration
Nothing is more frustrating for customers than selecting what they want only to find out some days later that the item will not get to them when it was supposed to because it’s either out of stock or has gone awry in the delivery process. Retailers who disappoint their customers this way risk losing them forever if they don’t make it up to them with major incentives like free replacements sent out with free rush shipping plus a special discount code for future purchases.
The cause of such mishaps is often something being misplaced within the warehouse. That’s one area in which RaaS can help assure retailers that they will be able to fulfill their promise to customers as a result of improved logistics and more accurate inventory counts. Making sure that customers get exactly what they want when they want it is an essential step toward winning repeat business and fostering long-term loyalty. And, RaaS can help boost that result. To recall the analogy, it’s the desired hole that they need the drill to produce.
Integration is Key to Seamless Automation
She began by explaining how they define the business relationship: Integration is key, starting with how InVia sees itself in relation to its own customers: “Our customers rely on our robotics systems to quickly and accurately move inventory throughout the warehouse, whether it’s moving out the door to fulfill orders or putting inventory back in the warehouse through stock replenishment or processing returns.”
The businesses that rely on InVia “Want to know that we’ll not only fit with their organization but also that we’ll make it even better,” she explained. Accordingly, they see their own brand as one that stands for “reliability and responsiveness.”
Holiday Rushes Managed by RaaS
This is important at all times, but it grows even more pressing when demand spikes up when retailers can “see their online orders quadruple,” Moore said. The combination of time crunch and stiff competition means that customers will not tolerate “late or inaccurate shipments,” and will not give another chance to “a business that can’t get it right.”
InVia strives to meet their changing needs by anticipating how many more robots may be needed during those times and sending them out to them. “We know that we have to have resource plans in place that can dynamically fluctuate to meet order volumes, without ever compromising accuracy.” She explained:
There is a lot of attention paid to the days between Black Friday and Cyber Monday, but our customers see the rush carry through into January as they are processing a growing number of returns each year. One of the biggest value-adds our system offers is maintaining inventory hygiene. Our robots are precise in the picking and placement of goods, which means our customers can rely on 99.9% accuracy rates. This is shared success and it can only happen with full integration.
Many Happy Returns Are a Major Part of Business Today
Even if the order process goes smoothly, a bumpy, frustrating return can turn a customer off. In the eCommerce world, returns are inevitable, and businesses have to be prepared to manage them in a way that reduces friction and pain points for their customers as much as possible.
Moore explained how RaaS helps businesses meet that challenge:
Returns are an important piece of the warehouse workflow. For eCommerce companies, this means quickly processing large amounts of inventory back into their warehouses. Unfortunately, many eCommerce companies don’t have systems in place to efficiently process multiple returns at one time, which can lead to the creation of a ‘wall of shame,’ or aisles of inventory waiting to be sorted into their appropriate location after a return.
It creates a chaotic rather than ordered warehouse: “Imagine a cyclone going through a warehouse and leaving products everywhere, all out of place waiting to be sorted out and returned to their proper place in inventory.” The returns then are just piles of stuff that can’t be properly inventoried and so takes up space without adding value.
The solution to that is setting up a way to get everything returned to its rightful place “That’s where InVia’s system comes in. We assess what needs to go back and the most efficient way to aggregate those goods, and then have the robots move everything back into its place. This allows companies to immediately put sellable items back on their shelves.”
That helps the retailers process returns faster, credit their customers faster, and improve cash flow by getting things back into place to be sold. Accordingly, better return management leads to more sales from the returned items and from the customers who have made the return as a result of their enhanced trust and loyalty to the retailer.