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Top 10 tech innovations in warehousing

How technology is shaking up warehousing, stock management and more.

Tech advances will play an increasingly important role in reducing supply chain costs and increasing the speed and predictability of product movement. The bank’s head of working capital and trade products, Mirka Skrzypczak, says it’s hard to imagine how businesses with absolutely no digital capabilities will be able to succeed in the future.

We look at the top 10 innovative warehousing technologies to impact logistics.

1. Robotics and automation

As robots become smarter, cheaper and faster, they are revolutionising modern warehousing. 

According to the International Federation of Robotics’ (IFR) report World Robotics 2021: Service Robots, one in three professional service robots are being built for the transportation of goods or cargo. Turnover for these autonomous mobile robots (AMRs) and delivery robots grew by 11% to over $1bn (£750m) in 2021. Most operate in an indoors environment for production and warehouses, often alongside workers, forklifts, and other mobile robots. 

While the automotive industry still dominates the use of robots and automation, other industries are expected to gain ground, as more supply chain professionals evaluate and pilot the technology. 

2. Sensors and automatic identification

Automatic identification technologies – from barcode and point-of-sale systems to imagers and beacons – are helping businesses use data to streamline and bring visibility to warehousing processes. By quickly and automatically identifying and tracking the identity and location of physical items in a supply chain, auto ID provides a major opportunity to improve tracking and tracing systems, process control and inventory management.

3. Radio frequency identification (RFID)

Among the most promising automatic technologies is RFID. Increasingly being adopted in modern warehouses, RFID uses radio waves to feed information between tags attached to stock and readers that pick up the signal. 

According to a recent RFID market research report from IDTechEx, the global RFID market was estimated to be valued at $11.6bn in 2021, rising to $12.2bn (£9.1bn) this year. 

IDTechEx says retail clothing alone will require more than 20 billion RFID labels in 2022.

4. Electronic data interchange (EDI)

EDI tech allows for the seamless flow of information between two different computer systems, streamlining the progress of purchase and shipping orders, stock transfer receipts, shipping and inventory advice. 

However, because the commerce landscape is changing rapidly, brought on by the ‘push’ of digital disruption in the supply chain and the ‘pull’ of consumers wanting greater personalisation and faster delivery, some organisations are reviewing their practices. A report on the future of EDI by Deloitte says this is where APIs come in.

With its history of deploying self-driving solutions in controlled environments, the logistics industry is in a prime position to further shape the future of self-driving vehicles

Dr Markus Kückelhaus
Partner, High-Tech Gründerfonds

An API (application programming interface) is a software intermediary that allows two applications to communicate. More real‑time data, says Deloitte, will allow for greater supply intelligence and a competitive edge in responding to abrupt market changes such as volume and price movements.

5. The internet of things (IoT) and telematics

The market for the connected devices network known as IoT in warehouse management is predicted to reach $19.1bn (£14.2bn) by 2025, says Grand View Research, up from $2.27bn in 2015. In EDI-dominated supply chains, innovators are increasingly turning to telematics – on-board covert tracking technology – to improve visibility once shipments are in motion.

6. Wearables

Wearable technology such as smart glasses, voice command devices and location tracking wristbands can enhance communication in a warehouse, improving efficiency, safety and productivity. 

7. Moving to the cloud

The cloud – a centralised location on the internet that stores data, making it accessible any time, anywhere, from any device – offers businesses greater scaleability, security, efficiency and flexibility. Migrating to the platform can make warehousing easier, safer and cheaper. 

In Innovation Driven Resilience, the 2021 MHI Annual Industry Report, Deloitte and US logistics and supply chain association MHI surveyed more than 1,000 supply chain professionals worldwide about innovation investments in the supply chain. They found that 54% of companies were increasing or substantially increasing their investment in cloud computing and storage to make the supply chain more resilient.

8. Autonomous vehicles

Driverless vehicles are predicted to become widespread within the next 10 years. Applications include autonomous transport and assisted picking; outdoor logistics such as yard, harbour and airport operations; assisted highway trucking; and convoying in line-haul transportation and last-mile delivery.

A director at DHL Trend Research until December 2021, now a partner in industrial tech at High-Tech Gründerfonds, Dr Markus Kückelhaus says: “Some warehouse operations have been using self-driving vehicles to some extent for years, but making driving in logistics more and more autonomous will change the logistics sector dramatically.

“Moving on to public roads is the next evolutionary step. With its history of deploying self-driving solutions in controlled environments, the logistics industry is in a prime position to further shape the future of self-driving vehicles.”

9. 3D printing

Additive manufacturing, or 3D printing, is forecast to have a 53% adoption rate in supply chains and manufacturing in the next five years, according to MHI, with 21% planning investment in this area. Sectors including aerospace and defence, automotive, healthcare, consumer products and retail have seen the most significant applications, including the use of additive techniques to produce service parts, high-volume or complex parts, or to create fashion and trend products with short lifecycles.

10. Drones

Autonomous vehicles and drones have a projected adoption rate of 57% in the industry over the next five years. Drones have a wide variety of applications, from scanning hard-to-reach barcodes to safely navigating warehouses and reducing the need for forklifts and other costly or potentially dangerous machinery.

Discussing its ambitious drone delivery programme, which launched in 2016, Amazon says: “Amazon Prime Air is a future delivery system that will get packages to customers in 30 minutes or less using small unmanned aerial vehicles. We’re developing a system that is safe, environmentally sound and enhances the services we already provide.

“We are rapidly experimenting and iterating on Prime Air inside our next-generation research and development labs, working to make our vision a reality. It may sound like science fiction, but it’s real. Putting the system into service will take some time, but one day, seeing Prime Air vehicles will be as normal as seeing mail trucks on the road.”

This material is published by NatWest Group plc (“NatWest Group”), for information purposes only and should not be regarded as providing any specific advice. Recipients should make their own independent evaluation of this information and no action should be taken, solely relying on it. This material should not be reproduced or disclosed without our consent. It is not intended for distribution in any jurisdiction in which this would be prohibited. Whilst this information is believed to be reliable, it has not been independently verified by NatWest Group and NatWest Group makes no representation or warranty (express or implied) of any kind, as regards the accuracy or completeness of this information, nor does it accept any responsibility or liability for any loss or damage arising in any way from any use made of or reliance placed on, this information. Unless otherwise stated, any views, forecasts, or estimates are solely those of the NatWest Group Economics Department, as of this date and are subject to change without notice.

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