Why Online Retailers Need a Flexible Warehousing Solution

author-thomas-genestar  Managing Director, Exotec.

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The need for online retailers to adopt flexible automation in their warehouses is urgent, if your business is to remain agile during challenging periods.

Why Online Retailers Need a Flexible Warehousing Solution

During the coronavirus pandemic, the world was forced to go digital. However, many online retail ‘winners’ at the time are now facing a loss of revenue, workforce cuts, or even total collapse as many customers return to the high street post-Covid.

A shift in buyer behavior post-Covid has left many of the most successful online retailers during the pandemic floundering, indicating that a lack of agility to respond to the fluctuating market can severely impact retailers and online businesses no matter their size.

Fortunately, flexible automation in warehouse environments can help struggling online retailers to respond to the shifting buyer behavior which is turning back to the high street.


A tough time for online retailers


Research from Retail Gazette examined the performance of the UK’s biggest online retailers in 2022, and has found that despite pandemic success, sales and profits are down across the top 10 companies in the sector.

As well as a change in consumer habits, surging costs, supply issues, and global economic downturn are also contributing towards a difficult time ahead.

Retailers such as AO.com, Asos, Boohoo and Ocado suffered significant share price, sales and profit losses. Made.com saw a 95% drop in share price in 2022 and -32.6% loss in profits versus 2021. The company has now gone into administration, with the brand bought out by Next.

Many online retailers are wondering how they’re going to survive, as consumers and businesses alike face the high cost-of-living crisis and a potential recession.

All of this market upheaval is likely to impact how and where people spend their money during the Golden Quarter, retail's busiest time of the year, and beyond.

For that reason, being smarter in the way retailers manage stock, logistics, and customer demand is crucial.


The future of warehousing is flexible


There is a need for retailers to take a flexible approach to automation in the warehouse environment to adapt to rapidly changing situations. 

While automation isn’t a new concept, traditional automation is sized on anticipated volume of orders based on a long period of time. As a result, legacy technology and equipment is no longer enough to support the unpredictable warehouse environment of today.

Instead, robotics has huge potential to support the complex and ever-changing warehouse landscape. There’s no one-size-fits-all solution to the range of challenges that online retailers are up against, but that’s the benefit of robotics systems.

With robotics systems, businesses can adopt flexible automation technology that’s tailored to their current needs and which can be easily scaled in the future.

Choosing robotics for flexible automation in warehouse environments provides a system that suits the current online retail landscape and supports retailers' human workers, while keeping up with rapidly shifting market demand.


Robotics benefits: Tomorrow’s automation today


Flexible automation in warehousing is no longer a smart addition, but rather an essential component for sustainable growth in uncertain times.

Embracing robotics increases productivity and makes life easier for human staff, by reducing the need for people to walk long distances picking products over the course of a shift.

Robotics also increases storage density and reduces warehouse costs as robots can be deployed to retrieve totes from racks that are several meters in height. 

An effective robotics system works as a fleet, with individual robots programmed to prioritize the most urgent orders, working closely with human operators.

Crucially, a robotics system in retail and warehousing enables processes to be adapted rapidly as customer demand changes.

Online retailers will learn many hard lessons this Golden Quarter and throughout the years ahead. Legacy automation equipment often struggles to adapt or change with fluctuating demand, which isn’t ideal given the current volatile retail climate.

If encountering busier periods than expected, some retailers’ warehouses simply won’t be able to cope, and customers will be impacted – reducing the likelihood of them returning. 

However, by embracing a flexible warehouse environment that combines human workers with robotic solutions that are scalable and adaptable to uncertain times, online retailers can avoid the same fate as the once untouchable retail giants of e-commerce.  

Thomas Genestar is Managing Director of Exotec, an end-to-end solution to turn a regular warehouse into a partially automated logistics platform, in Western Europe. Connect with him on LinkedIn.