Automation for Q-Commerce
Interview with WITRON CEO Helmut Prieschenk and Noyes founder Marco Prüglmeier
For years, Marco Prüglmeier was jointly responsible for BMW’s logistics. Now, he wants to revolutionize distribution logistics in cities with Noyes Technologies. This also attracts the interest of the intra-logistics expert. WITRON’s CEO, Helmut Prieschenk invited Marco Prüglmeier to Parkstein.
The idea from Prüglmeier and his team at Noyes: a robot-operated warehouse system, mini warehouse, or nano warehouses for Q-Commerce in cities. “We don’t want to reinvent the warehouse outside the city”, explains Prüglmeier. The Munich-based company wants to integrate a goods-to-person functionality into its small warehouse and relies on “ultra-dense storage” because urban storage areas are more expensive. In addition, there is hardly any space for delivery services such as Gorillas and Co. in Paris. In terms of technology, he relies on small robots (35 x 35 cm) that operate on different rack levels and are manufactured in Lebanon. Prüglmeier was head of logistics at BMW for many years and a lot of his colleagues and students from that time came from Lebanon. “That’s where ideas were born, and the contacts have remained.” The intelligence is embedded in the controls of the robots that navigate between the levels. The robots from Lebanon remind Helmut Prieschenk of shuttles. “It goes into that direction. But the more decentralized you think of a solution, the more you have to think of automation differently. We have to think about the noise in the stores, about accessibility, and maintenance”, explains Prüglmeier. The challenge for Q-Commerce companies in small stores is storage space. “It is often not enough, but we manage to store items in a dense manner”, ensures the founder. “But it’s not just the metropolis that challenges our logistics experts and customers. New supply concepts are also needed in rural areas. Neighborhood stores or supermarkets without staff will soon be reality”, predicts WITRON CEO Helmut Prieschenk.
Risk of atomization
Also WITRON recognizes the demand of retail customers for Q-Commerce solutions. “Of course, our retail customers ask for such a solution - they are permanently searching for potential new distribution channels. But depending on the country, on average 90 percent of the main business is still done in the store, and the remaining 10 percent is then distributed across very different channels and technologies. There will certainly be a market shake-out”, the WITRON CEO is sure. On the one hand, there is a spread in technology, and on the other hand, customers are asking how the new business processes will pay off and how sustainable they are. “Atomization would be risky. It is important to think holistically end-to-end along the entire supply chain, for all distribution channels - store, click + collect, home shopping, and smart stores. In the best case, we should also think backwards, from the end customer to the distribution center. We have to bundle transport routes to the maximum and therefore consolidate delivery orders in advance in the best possible way. Basically, however, the decisive factor is always what services the customer is willing to pay for - and particularly how much.” Prüglmeier agrees. It is important to think in overall terms.
“Anything that needs to be delivered in less than two hours can only be managed if the goods are already in the city”, explains Prüglmeier. That’s why urban storage systems are needed. The team doesn’t want pallets there. The Noyes technicians prefer cartons, totes, or small load carriers. The logistics center outside the city picks for the decentralized unit and supplies the small hubs in the city center. The individual boxes of the nano warehouse are stored “and come out again as needed for the picker”, promises Prüglmeier. And the founder is already looking ahead: “In a second step, we think of item picking with robots.”
Bots instead of drivers?
The sustainability of the business model is important to Prieschenk: “Our customers demand sustainability in both the environmental and social field. Business can’t be done at the drivers’ expense. The business case has to be technically sound; it has to be economically viable, and it has to be ergonomically, ecologically, and socially sustainable. And we have to keep an eye on food waste”. Prüglmeier agrees. “In the environmental sector, we are looking at new cooling concepts to save energy, and in the next year or two we will have delivery bots. Maybe it’s not the ten minutes, but delivery times over two hours are not accepted by customers.” Prüglmeier is certain that different distribution channels will emerge for retailers in the future. The logistics experts agree with him. The experts from Parkstein already know bots from the USA. “New delivery concepts are also changing our warehouse logistics. The various elements must interact with each other physically and in terms of IT to avoid isolated solutions for transportation, distribution channels, or different product groups. Otherwise, the business model will not scale.” WITRON even offers rail transport to customers. Communication and data exchange between the bot, truck, or rail with the logistics center are crucial. “Also the data exchange of the destination to be supplied with the logistics center is decisive”, adds Prieschenk.
There is particularly one question that concerns Prieschenk in terms of Q-Commerce: What is the consumer loyal to today and tomorrow? “To a retail brand, to a brand product, to a price, to a service time, or to a network? Does the customer care who the product comes from if it is delivered at optimal costs and at the exact time?” Prüglmeier is missing sustainability as another criterion. It is also another important aspect for Prieschenk. For him, is Noyes a competitor or a partner in the market? “They are part of it, in a big platform.”
For WITRON, the platform concept has long played a decisive role in omni-channel logistics - moving away from the one-dimensional silo concept to a holistic end-to-end supply chain that fully integrates all players and distribution channels. This has resulted in a solution known as OCM (Omni Channel Machinery). “Consequently, our OCM is an integrated retail platform. It includes a high-performance omni-channel logistics center, interfaces to all horizontal and vertical players, and, in addition, an optimizer that makes it possible to easily and efficiently manage the generated network according to different priorities - by time, costs, performance, transport, or volume”, summarizes Prieschenk. However, WITRON does not want to develop a new route scheduling system or a new order management software, and certainly not act as a service provider between the retailers and their customers. “We combine existing technologies, develop a platform from the supplier, over the warehouse, through to the store or end customer, create transparency within the retail network, and enable data exchange between all parties involved”, promises Prieschenk “all the way to the store and to the end customer, and that’s where a Noyes solution can also be a hub.“