We are now at a stage where the challenges within the supply chain are necessitating a change of mindset amongst warehouse operators, with automation and robotics being considered a viable, and at times necessary, alternative to large amounts of labor.
We are also seeing companies introducing robotics on a large scale. Amazon recently received a patent for its idea of a warehouse in the sky with orders being fulfilled in an airship and the items being delivered by drones. They’ve also filed a patent for underwater warehouses utilizing acoustic vibrations to make packages rise to the surface. Farfetched it may seem, but these companies are pushing the envelope to meet ever-increasing and complicated challenges. The development of AI and VR will also have a significant effect on warehousing in the future.
Let’s create a context and examine the factors that will affect warehousing in the future:
- Globally, we have a growing but aging population. Land will then be at a premium, with some research suggesting that 70% of the world’s population will be living in cities by 2030. There are likely to be labor shortages in key areas, which suggests a significant growth in automation, but in those areas where automation is not an option there will be a need for elder-friendly workplaces, and in some countries people will be required to prolong their working lives.
- The growing economies of BRICS countries and those of the developing world, especially in Malaysia, Indonesia and Vietnam where consumerism and the growth of the internet will put even greater pressure on consumer product manufacturers and their warehouses.
- As economies grow and the population gets older, there will be greater competition for staff. Warehousing has not been a career of choice for many because of its image, and companies are going to have to market themselves better to become more attractive. The introduction of more technology into these warehouses will be significant. Conversely, the introduction of greater automation could see a reduction in the requirement for staff at an operational level but an increase in more technologically astute staff. The closure of many high street retailers because of the move away from purchases from bricks-and-mortar stores to online will see the possibility of staff re-deployment into the retail fulfilment centers.
- Sustainability will play a significant role in supply chain operations. The green lobby will look to the supply chain for initiatives in terms of alternative energy use, reduction in CO2 emissions, reduction in waste and water usage, and the use of alternative forms of transport. This will include intermodal transport initiatives as well as fuel-efficient MHE. Consumers and retailers will also be encouraged to source locally, leading to an increase in demand for neighborhood warehouses.
- As fossil fuels decline, there will be a move towards more sustainable energy. Companies will look to warehouse automation and the use of greener vehicles, whilst developers and warehouse operators will be encouraged to consider solar panels, wind turbines and the use of waste product for energy production. New and existing warehouses will be equipped with electric charging points for delivery vehicles and hydrogen filling stations.
- An increasing pressure on companies to collaborate and share resources. Many warehouses and transport modes are under-utilized, so pressure from the green lobby and continued pressure to further reduce costs will encourage more companies to collaborate.
- The shortage of and subsequent increasing cost of land will see the development of more underground warehouses.
This extract from Warehouse Management by Gwynne Richards is ©2021 and reproduced and with permission from Kogan Page Ltd. Download the full chapter, ‘The warehouse of the future’, at www.koganpage.com/warehouse-of-the-future.
Gwynne Richards has over 30 years of experience in warehouse management and logistics and is based in the Vale of Glamorgan, UK. As well as running his own successful logistics consultancy, he provides a number of courses on warehouse and transport management and logistics outsourcing for practitioners. He is the co-author of The Logistics and Supply Chain Toolkit with Susan Grinstead and The Logistics Outsourcing Handbook with Jo Godsmark, both published by Kogan Page.