Following a pilot launch phase last year, Walmart has gone fully operational with its test of Alert Innovation’s Alphabot technology, its automated micro-fulfillment solution.
Automating grocery ecommerce picking
Walmart initially announced in 2018 that it would partner with Alert Innovation to pilot an in-store robotic picking system for grocery ecommerce orders. The Alphabot technology, which has been developed specifically for Walmart, is being deployed at a supercenter in Salem, New Hampshire, housed in a 20,000 sq ft extension connected to the store. This also serves as a dedicated grocery pickup point. The Alphabot technology automatically bring items from dedicated storage space to store associates who consolidate the items in the order. Most grocery, chilled and frozen products offered in-store are fulfilled through this system, although Walmart’s personal shoppers continue to select produce and some fresh products.
Enhanced customer experience
The Alphabot enables Walmart’s associates to have more time to focus on service and selling, creating a more compelling pickup experience. The Alphabot system also allows customers to place orders closer to the pickup time. Last year, we had the opportunity to see a version of the system in action. At a store in Bentonville, it is being used for the storage and retrieval of orders, but not to pick orders. This enables the store to increase the capacity of orders being fulfilled and deliver a faster pickup experience. Walmart believes there is scope to deploy the Alphabot across its network; as the carts that carry items move both horizontally and vertically there are fewer space constraints to consider.
Source: IGD Research
Range of fulfillment solutions
Within the US market, several different fulfilment models are being used, or are under development. Beyond the traditional in-store picking model, these include distribution centre-based solutions such as Target Restock and Kroger Ship, third-party on-demand services, such as Instacart and Shipt, and centralised automated fulfillment. Next year, Kroger will launch the first of up to 20 Customer Fulfillment Centres (CFC) through its partnership with Ocado.
The rise of automated micro-fulfillment
However, automated micro-fulfillment has been the key development of the last 18 months. Takeoff Technologies has emerged as the front-runner in this space, forming relationships with Albertsons, Ahold Delhaize, Sedano’s and Wakefern in the US, Loblaw in Canada and Woolworths in Australia. Dematic has also recently entered the space through a partnership with Meijer while Israel-based Fabric is reported to be working with several US retailers. The growing interest in this model is driven by the industry-leading picking rates that can be achieved within a store-based environment. The model is a low-cost solution that can profitably generate tens of millions of dollars in sales from each site.
Digitising the in-store environment
The Alphabot is the latest element of Walmart’s aim to digitise the in-store environment. It continues to expand the number of in-store pickup towers, shelf scanners, FAST backroom unloaders and autonomous floor cleaners. It is also testing electronic shelf edge labels (ESLs) and digital name badges while it recently announced a partnership with Nuro to test autonomous grocery ecommerce deliveries in Houston.
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