Owning a robot army isn’t a goal for many firms, but leave it to innovative and trendsetting Amazon to be among the few that can. The Seattle online retailer has outfitted several U.S. warehouses with short, orange, wheeled robots that move stocked shelves to workers, instead of having the workers seek items amid the long aisles of merchandise. The robots themselves are the result of Amazon’s 2012 purchase of Kiva Systems Inc. for $775 million, and the new robotic workforce is saving a whole lot of time, and even more money.
Amazon estimates that since incorporating the robots into their workforce, they have saved between $400 million and $900 million in fulfillment costs. That is, the dollars spent to assemble, sort, pick, and ship the merchandise. Put another way, it’s simply reducing the number of times that a product is touched.
The robots were in particular demand for the holiday rush, when Amazon typically generates more than one third of its annual revenue. That’s a staggering amount of merchandise, and a logistical feat. In December of last year Amazon was forced to offer rebates to some customers after delivery delays. So the robots in the Kentucky, California, and Texas warehouses are alleviating some of those processing snags.
Some pundits and analysts are concerned that employing robots can displace human workers. But an organization as large as Amazon needs all the assistance it can get. In addition to the 20 or more robots at its largest warehouses, Amazon hires up to 80,000 temporary warehouse workers for the holiday season. It also has frequently tested its own network of shipping trucks, and even enlisted yellow cabs for prompt one-hour deliveries. The online retailer even made headlines earlier this year when it announced it was experimenting with drone technology to leave packages at customer’s doorstep.
The new tech allowed Amazon to accept its last order at 10:24 p.m. on Christmas Eve and get it delivered at 11:06 that same evening. This was part of a special deal for New York City.
While these are not manufacturing robots and don’t, as far as we know, use Rexroth technology, we think this is a further example of how robots are becoming ever more intertwined with our daily lives.