The Supply Side: Robots seen as enhancing retail store operations

Consumers shopping in brick-and-mortar stores could see more robots at work as the cost of technology has come down and the industry struggles to find labor. Since Amazon first began using robots to fill orders in its warehouses, retailers from Wal-Mart Stores to small regional pharmacy chains are testing robots to manage inventory.

Wal-Mart began in August testing a Bossanova robot that can handle such tasks as scanning shelves for out-of-stock items and wrong or missing labels. By using the 300-pound robot to scan shelves, take high resolution images and create a panoramic view of the shelf and generate a report of the findings, employees can quickly replace the out-of-stocks.

Wal-Mart is testing the robots in about 25 stores with the number increasing to around 50 by year end. Inside Wal-Mart Store No. 54 in Springdale — a Supercenter facing South Thompson Street — shoppers may spot T.J. between 6 and 7:30 a.m. The Bossanova robot has been assigned to the store since August.

Kenneth Todd and Anthony Russo of Ricoh — a third-party robotics service provider — manage T.J., who makes its runs early each morning and then hangs out in the employee lounge in the back room of the supercenter the rest of the day and night. Todd said it takes T.J. about 90 minutes to make its runs scanning the grocery and consumables areas of the store. If there are few distractions, the work can be completed in about 40 minutes, he said. The robot wears a Wal-Mart name tag bearing the name “T.J.” The bot was named after the employee who used to do the scanning manually.

“Travis is happy to have Travis Junior helping him with the daily scan tasks because it allows for more efficiency,” Todd explained. “The employees can get to restocking and fixing problems faster when the report is waiting for them to start their day.”

Russo said the robot can read the depth of the items on the shelf and soon it will be able to tell if there is something out of place. He said the robot has the store map embedded in its memory and is fed algorithms which tell it which mission to make. He said the robot has several sensors on it that allow it to detect obstructions and people.

“We tell it what shelves we want scanned, take it out to its home position in the store and it gets to work,” Russo said. “If there is an obstruction in the aisle, it will navigate around it and resume scanning. If too much of the aisle is blocked, then the robot will move on and return later.”

The robot is 7-feet tall and able to scan items on the floor up to the top shelf. Russo said Wal-Mart is believed to be leasing the robots, which is likely the arrangement that will continue. In a typical 45-minute mission, the robot will store up to 500 gigabytes of information, which is compiled into the report.

Todd said customer reaction to the robot varies from people thinking it’s cleaning the floors to others who just shake their head thinking, “There goes another job.” He said the robot performs best when there isn’t a lot of traffic in the store. Most of the time, he said customers just pass by without a second look. Russo said the robot manufacturer is working on a docking station that resembles a phone booth. The robot will go inside the booth to charge and the doors will close. When ready, the booth doors will open, and the robot will make its run. He said the enclosed booth will protect the robot from being bumped by pallet jacks.

Wal-Mart said the combination of people and technology are helping to make its stores more convenient and easier to shop, ensuring that products are available when customers want them.

Brad Bogolea, CEO of San Francisco-based Simbre Robotics, spoke in October about the opportunities for digital parity in brick-and-mortar. His company has a robot they call “Tally” which is being tested by several U.S. retailers.

“Tally works alongside retail workers and customers,” Bogolea said. “For retailers wanting to move ahead, it’s going to be important for them to introduce technologies that bring efficiency to their operations in light of what Amazon is doing to disrupt the entire retail sector.”

He said the lack of instrumentation in stores is a real opportunity for companies like Simpre and its competitors, particularly with helping retailers detect out-of-stocks. Bogolea said retailers have invested heavily in supply chain intelligence, but that only gets the product from the manufacturer to the store.

“It doesn’t always tell you what’s on the shelf, and that’s ground zero for the customer and where they make their purchases,” he said. “Retailer intelligence picks back up at the point of sale, but there is a gap we think technology can help fill.”

Retailers perform manual shelf audits to try and keep track of product inventory at the shelf. He said this is a mundane and time-consuming job for hourly employees and costs retailers like Wal-Mart thousands of hours a week. He said even small stores like Dollar General spend up to 25 human hours a week with only limited accuracy.

“By the time the physical audit is done, the store shelves have been empty longer than they need to be. Retailers lose an estimated $448 billion each year because of out-of-stocks. Brands also lose out to competitors because if their item is not on the shelf when a customer wants it, that’s a sale that’s probably going to a competitor,” Bogolea said.

On average, he said 10% of the items on a customer’s shopping list are routinely out-of-stock. If the item is on sale, that increases to 20%.

“That’s why we built Tally to help provide out of stock information to retailers in an accurate and expedient manner so the issues can be fixed sooner. We partner with physical retailers and are also testing in some dark stores that fulfill for e-commerce,” he said.

When asked about robots taking human jobs, Bogolea said the robots enhance the work of humans by removing some of their routine tasks and freeing up time to do more sophisticated work.
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Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak Logistics.