MHI Solutions Improving Supply Chain Performance
SPONSORED CONTENT PRESENTED BY PRIME VISION TECHNOLOGY
Everyone has heard of going the extra mile, but for e-commerce and logistics companies, the last mile is often the most challenging. To streamline the process of getting orders faster to the customer’s doorstep, many businesses rely on localised or temporary facilities. For the giant as well as the smaller sorting centres close to the customer, mobile robots are a proven solution to optimize routes, maximize available capacity, and reduce overhead cost.
Hans Jongebloed, Senior Advisor at Prime Vision, explores the possibilities.
All over the world, delivery drivers are travelling vast distances to drop off parcels. Whether in trucks, vans, cars or, in dense urban areas, even on bikes or tricycles, people follow their satnav or rely on old-fashioned local knowledge to complete this complex job. It’s also an expensive activity, eating up around 41% of the cost of the entire logistics process.1 This is because home delivery takes up a lot of time, fuel, and plenty of personnel.
The further a driver goes to deliver a parcel, the more expensive it is. Therefore, companies prefer to place pick-up points near popular delivery routes in easy-to-access areas, to shorten the distance to the first drop-off. However, there are complications.
Challenges today and in the future
Available land is restricted, so the opportunities for businesses to build sorting centres of their dreams close to delivery routes are few and far between. Many must make do with operating from existing facilities with less floorspace.
Next is the uncertainty of demand. Rapid growth has been the narrative of parcel delivery, driven by convenience and supercharged by the unique conditions of the pandemic. However, many businesses are unsure how demand will change in the future which makes them wonder if investing in a new, large local sorting centre would be worthwhile? Most companies are delaying big projects to see future market outcomes.
In the meantime, they still need to sort for the demand that is there today. Achieving this often relies on smaller, temporary facilities. Using a smaller local site, companies can get closer to their customers to improve service and reduce costs, while pop-up sorting centres can be set up to cover the peak periods around November and December.
Fixed infrastructure isn’t ideal
The challenge is to work out the optimum operation based on parcel volume. The 100 to 200 parcel capacity of a van doesn’t change, so more deliveries means more drivers and as a consequence greater sorting capacity, mandating multiple facilities close to the route. As parcel volumes increase, companies can find themselves feeling the squeeze.
This effect can be worsened by equipment. Most of the fixed infrastructure used in large sorting centres is unsuitable for small-scale or temporary facilities. Sortation machines are massive and expensive, costing nearly as much to take down and transport as the initial purchase. Also, conveyors are fixed to the floor, making them difficult to move. Besides, even at peak demand, local sorting centres simply don’t experience the volume that the larger sites do, making big machines and conveyor systems not the best option.
Sorting the last mile with robots
Mobile autonomous robots from warehouse automation experts like Prime Vision are the perfect choice for sorting the last mile. Suitable for everything from small sorting centres to operations running out of hired garages, robots won’t get in the way of any approach a business wishes to take.
Mobile rovers can easily process 100 to 10,000 parcels a day, with the fleet able to grow or shrink to meet demand. Completely flexible, they can be programmed or rerouted to accommodate sorting parcels to more or fewer drivers without the restrictions of fixed infrastructure, allowing businesses to maintain streamlined operations. Crucially, robots don’t need as much room as other equipment, making the most of smaller locations.
They are transportable as well, which is ideal for temporary facilities. Fleets of 20 to 60 robots can be operational at a site in a few days, buying companies time to see how local volumes change. This is a better approach than risking investment in large facilities, as robots allow operators to simultaneously gauge and meet demand. If volumes begin to drop, robots can be easily transported elsewhere. Prime Vision specializes in these installations and relocations, often moving equipment for its US customers to new facilities within a week.
Such qualities become especially useful during peak demand from around October to the end of December. It also suits the business model of third-party logistics (3PL) companies, which typically have three-to-five-year contracts – not enough for a return on investment (ROI) on sortation machines or conveyors. When a new contract is secured, the 3PL can simply take the robots with them. This ability to accommodate different last-mile set-ups and strategies means robots can work at all levels of the logistics food chain. More than that, robots enable businesses to overcome specific challenges and unlock new advancements in last-mile logistics.
Driving change in logistics
The shortage of drivers in logistics is well known, but what is less talked about is how robots can help alleviate the problem, giving businesses more flexibility. If some drivers are missing on a particular day, instant changes to the robot’s routing can seamlessly divide the parcels over the remaining team. This allows businesses to maximize the resources they have, ensuring consistency of service.
Robots also enable a deeper level of sorting that can open new possibilities in the way that routes are taken. More efficient deliveries can be organised for parcels with a two-day due date or longer, especially if orders destined for the same addresses or local areas can be grouped together. This is beneficial in the countryside as it minimizes mileage, while in cities it reduces traffic. Drivers benefit from making fewer stops and shorter routes.
The high optimization of sorting and routes also suits more sustainable delivery methods. By sorting parcels in order of drop-off, deliveries are streamlined, helping drivers cover more addresses in less distance. Operations can also be tailored to factor in battery charging times, so even electric vans are always ready to go. In the coming years, the flexibility of robotic sorting at small local facilities will be key in supporting cleaner ways of getting parcels to people.
Getting closer to the right solution
Efficient and cost-effective last mile logistics rely on getting closer to the customer. However, the right conditions to build the perfect localized sorting centre for the activities of an e-commerce, warehousing, or 3PL organisation rarely exist. When supporting fluctuating demand during a shortage of space and drivers – robots are the way to go.
Prime Vision has experience providing robots for last-mile logistics operations, applying their benefits for varied approaches to improving the efficiency and cost-effectiveness of last mile delivery. With its expertise and flexible solutions, delivery companies can not only get closer to their customers, but their automation partners too.