Inside Logistics

Automation will be key to post-pandemic e-commerce success

Increasing e-commerce demand and changing inventory strategies make automated solutions worth considering


August 18, 2020
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TORONTO – In the wake of Covid-19 pandemic lockdowns, e-commerce demand has skyrocketed, prompting retailers to look closely at warehouse and distribution centre automation as a means of keeping up with demand.

“Demand has spiked to the point where some of our customers are saying every day is like Black Friday,” said Nick Klein, Bastian Solutions’s sales director for Canada. Even purpose-built omnichannel operations have not been able to keep up in some cases, he noted.

Klein was speaking in a Bastian Solutions webinar, “Addressing pandemic pressures in supply chain automation”.

Increasing numbers of customers are investigating their automation options, Klein noted. “Nobody knows what the new normal will be for buying behaviour, however the assumption is there is a growing comfort with e-commerce” as people who have never bought online suddenly discovered they could get their necessities without leaving the safety of their homes.

The immediate effect of the pandemic was a surge in demand for staff at the same time that people really didn’t want to go to work. Now, with physical distancing rules in most e-commerce fulfillment operations there just isn’t enough room for employees to keep two metres apart while picking orders, creating new demand for automation, Klein added.

Another effect of the pandemic has been concern about ensuring inventory is where it needs to be. Online-only SKUs now also need to be stocked in the store for buy online pick-up in store (BOPIS) orders, companies are considering more local manufacturing with shorter supply chains, and there will be an increase in returns that comes with more e-commerce.

Klein noted that with the pandemic in its fifth month in North America, it would be difficult to pinpoint automation solutions that had been implemented as a result, but the interest in micro-fulfillment has amplified, and last-mile delivery is now an even hotter topic than it was.

Adapting to these challenges will requires flexibility and immediate action. “Even though the landscape is rapidly developing, the status quo until all this settles may be a risky tactic,” Klein said. Instead companies should evaluate their current position and identify options to consider, then stress-test those options using various new-normal scenarios.

He pointed out that with the number of automation options available on the market it is relatively easy to find a modular and scalable solution that will allow for expansion as demand increases.