Logistics: Automating the last 50 Feet

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Logistics: Automating the last 50 Feet

The last mile of the logistics chain is a huge challenge but the closer you approach your destination, the more complex and expensive it gets. Not coincidentally, the ‘last 50 feet’ is considered by experts to be the true bottleneck for e-commerce growth – and that’s where a large part of the future of retail is being decided. Start-ups and online retailers alike are working hard to close that final gap.

by Marcel Weiss

Everybody’s doing it these days – namely buying stuff online. E-commerce has been growing for decades with no end in sight but the actual delivery of purchases is still handled by an infrastructure designed and built for the mail-order age. The final burden is born by the postal systems and delivery vans which have to tour neighborhoods and laboriously deliver each package to the customers’ homes.
This is the biggest bottleneck constricting e-commerce growth, the so-called “last mile,” which accounts for between 25 percent and 50 percent of the total shipping costs. The expense incurred means there is a huge market opportunity for innovation – and a lot of companies are joining the sprint to win a share of the last mile.
One obvious route is to develop autonomous robotic carts to deliver goods from the local fulfillment center. Amazon is testing its “Scout” robot, which looks like a six-wheeled cooler box. The prototype models are currently accompanied by human “minders,” a bit like the early days when cars were preceded by a man with a red flag, but Starship Technologies, an Estonian start-up run by two former founders of Skype and headquartered in California, is a step ahead.

Logistics - Amazon Scout - source ©: Amazon

Cool Delivery: Designed to safely get packages to customers using autonomous delivery devices, the Amazon Scout is about the size of a small cooler and rolls along sidewalks at a walking pace, carefully avoiding pedestrians and other obstacles.

Starship’s carts are already making autonomous deliveries in selected, well-definied areas such as the campus of George Mason University, Virginia, and the UK town of Milton Keynes. The company has recently reported more than 100,000 successful commercial deliveries to date.
Google and Starship are by no means alone. Refraction AI is working on a delivery robot called REV-1 which uses the side of roads, bike lanes, as well as sidewalks. For safety reasons, the REV-1 is larger than the Scout or Starship robots to make it easily visible to drivers but it’s still far smaller than a traditional delivery van and able to qualify under e-bike regulations in the US, the company says. Even bigger is the Robomart van, which is taking a slightly different route by offering a kind of mobile vending machine. The customer requests a visit and can choose from a range of goods carried by this minimart on wheels.

Logistics - Robomart - source ©: Pop-Up City

Store on Wheels: California-based start-up Robomart has introduced a driverless vehicle that will sell you small groceries at your curbside. An array of cameras monitors what people take, then the bot calculates what to charge them, before puttering off to the next customer.

Other start-ups bidding for ownership of the last mile include HelloWorld Robotics from Singapore, Eliport in Spain, and US firm Nuro.
All of this doesn’t mean the long established logistics companies are standing still. FedEx, for example, is partnering with Walmart, Target, and Walgreens to launch a program based on its SameDay Bot.

Clearing the Way

The sidewalk or road versus local bylaws argument hints at the struggle that will dominate any progress in the last mile. Robots on crammed sidewalks or in busy bike lanes don’t sound like something the populace, and therefore regulators, will accept once this mode of delivery gains any significant traction.

Logistics - Refraction REV-1 - source ©: Refraction AI

Side by Side To maximize flexibility and safety, Refraction’s REV-1 is lightweight and low-power enough to qualify under e bike regulations, but is fast and nimble enough to operate in traditional car lanes without impeding traffic.

Looking upwards, drones could provide an answer but the same red tape problems are holding things back – and rightly so. Amazon’s Prime Air is the company’s development project based in the US, the UK, Austria, France, and Israel but, although the first test was in 2016, it still hasn’t taken off as a commercial proposition. Airspace use in densely populated areas needs to be carefully regulated to avoid accidents and, at the moment, delivery drones can only be classed as unindemnified flying objects.
This doesn’t mean drones are out of the picture altogether. The last mile can sometimes translate into 50 kilometers or more in countries with large rural areas. Jingdong (JD.com), China’s largest online retailer, has been pouring billions of yuan into its logistics infrastructure. As part of this, the company is working on drones in a big way. The JD robots will be capable of carrying loads weighing up to one ton to and from remote rural areas and villages.

Logistics - Drone JD - source ©: TechCrunch / Verizon Communications Inc.

Coming Down! Chinese online consumer electronics retailer JD.com is experimenting in Indonesia with a drone based delivery system that can help service out-of-reach areas and generally expedite its dispatches.

Sharing Resources in Logistics

JD.com plus the likes of Amazon and the UK-based online supermarket Ocado are also spearheading another important trend in e-commerce logistics. As these large online retailers build their state-of-the-art logistics infrastructures, they can offer to share these new resources, and their accumulated expertise, to others. Amazon uses logistics to make things better for its marketplace partners, and JD is increasingly offering cutting-edge logistics automation at more points across the logistics chain. The Ocado Group is offering turnkey solutions to grocery retailers and struck its first three-year US deal in October 2018 to build 20 warehouses for the Kroger supermarket chain. These will use automation technology based on the decades long expertise of Ocado.

Logistics - Ocado Hive - source ©: The Spoon

Welcome to the Hive: British online supermarket Ocado has filled a warehouse in Andover, a small town in southern England, with what seems to be a huge chessboard, populated entirely by robots. The so-called hive-gridmachine can process 3.5 million items or around 65,000 orders per week.

Online retail has been pushing logistics to new heights for many years and the large, established online retailers have learnt how modern delivery processes should operate. Until now, retail has been the carrier’s customer but now it is stepping up to take control of the delivery channel. Successful automation of the last mile needs a more holistic approach than just robots on the sidewalk. For starters, as Mark Godwin, cofounder of Boxbot (yet another start-up developing delivery robots) recently told Wired magazine, the hardest part of the last mile itself is the last 50 feet.

Ford Robot - source ©: Ford Motor Company

Two Legs Good Ford is using robotics to explore a new frontier in the world of autonomy. Teaming up with Agility Robotics, the automaker has introduced Digit, a two-legged robot capable of lifting packages that weigh up to 40 pounds.

Getting to a customer’s front door and delivering the package may involve opening a gate or moving around a flower bed, which is why autonomous delivery usually means the customer has to come to the sidewalk to pick up their package – or the robot is accompanied by a human to do that, he adds.
For the time being, automation will augment delivery fulfilled by people in vans and the last few feet will have to be covered by a human. But the overall process can hugely benefit from the increased efficiency automation offers. To be really effective, the whole delivery operation must be rebuilt to eliminate these and other obstacles. Carmaker Ford is driving a project using bipedal, humanoid robots in autonomous delivery vans. It’s still in the early stages of development but if it goes ahead, the last few feet could be navigated without causing damage and stairs or other obstacles would not be a problem to prevent delivery to the door.
Amazon is taking a different approach. The company accounts for about 40 percent of all e-commerce in the US, according to research firm Rakuten Intelligence, with its own logistics system handling around half of its deliveries. For the last 50 feet, Amazon has devised Key, a smart door-lock system that allows the delivery person to enter the customer’s house or garage, watched through a remote camera, when no one is home. It is a very secure system which only allows access for a specific delivery at a fixed time slot, but for some customers it is proving to be a step too far and a potential invasion of privacy.

Logistics - Amazon Hub - source ©: Amazon

Somewhat less controversial are Amazon’s Locker and Hub initiatives. Locker is an extension of Amazon’s delivery to a store participating in its Counter delivery scheme, and the customer has to visit the store to collect their purchase. Counter has the disadvantage that it can only be accessed when the store is open. Locker is an improvement because it uses smart cabinets in secure areas that are available anytime.
Locker is a development of this and makes delivery to an apartment block easier. The Key system allows a delivery person to enter the building to access a rack of smart lockers, similar to the Locker system’s cabinets, in the foyer. This allows goods to be delivered to a secure place to await collection when the customer gets home.
In both cases, the size of the lockers means that larger purchases cannot be handled and will still rely on the customer, or a friend, being available at the time of delivery. It also means that the current range of Scout robots cannot be used. The problem is not insurmountable and one day Scout robots’ future iterations may be able to enter apartment buildings using Amazon Key and dock to Amazon Hubs. But devising a fully automated delivery system could prove more expensive than the current van-and-man (or woman) systems.

Logistics: The Final step

Owning the logistics chain end-to-end will allow Amazon to go deeper into automation and the company is increasing the number of small Prime fulfillment centers as close to city centers as possible to reduce the “last mile” as much as possible, so that this final step can be covered in as little time as possible. Automation also allows for centralized, detailed, algorithmically optimized synchronization of delivery processes as each part of the system becomes more flexible. Intelligent software platforms are becoming increasingly important and indispensable as delivery options.
Facilitating the last-mile solutions means changes have to be made at the warehouse end of the business. A more efficient use of cubic meters at automated warehouses allows for smaller, sustainable warehouses to proliferate. Because of the increased number, each one can be more specialized and become a crucial part in the robotic delivery chain.

Bionic Exo Skeleton - source ©: GBS German Bionic Systems GmbH

Mother’s Little Helper: German robotics specialist Bionic demonstrated the first fully networked exoskeleton at Hanover Fair. Designed specially for the Industrial Internet of Things (IIoT), it boasts self-learning capabilities and artificial intelligence.

Even today, fulfillment centers are being automated and augmented with technology at every level to increase efficiency and adaptability to enable the anticipated increased volume of deliveries. Where robots lack the intelligence required for a task, exoskeletons for employees are now starting to help. Gerald Mueller, head of process and efficiency management at logistics form DB Schenker, says that first tests at its logistics hub with German Bionic’s Cray X exoskeletons have been met with positive reactions from the employees and has proved to make manual work healthier and more efficient. This hints at larger augmentation coming to logistics as robots take on more jobs and humans with exoskeletons keep up the pace, doing everything the robots can’t handle themselves.

Humans with exoskeletons will do everything robots can’t handle themselves.
Gerald Müller, DB Schenker
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The process of automating delivery is gathering momentum and we can expect more, but smaller, provisioning centers and greater differentiation in last-mile delivery methods as the new value-chain structure emerges. Online retail giants expect to play a crucial role in tomorrow’s logistics world because they feel they know best what’s missing today. As they build up their logistics businesses, by providing or commissioning the missing parts for a modern infrastructure, solving the last-mile challenges, and especially the last 50 feet, will play a major part in fulfilling this aspiration.

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