Shared user savvy

I WAS delighted to visit Wincanton’s high-volume eFulfilment facility in Northampton - home to the logistics provider’s latest AMR solution for eCommerce customers. The site was part of the operation of specialist eFulilment business Cygnia, which Wincanton acquired in September 2021. It was a real privilege to get a close look at this highly efficient operation.

Wincanton chief customer & innovation officer, Paul Durkin, says: “When we acquired the business, we quickly looked at Cygnia’s plans, and one priority that leapt out was developing the mobile robots. We brought in our deeper engineering and project management experience, baselined a business case, and got that signed off in December 2021.”

The facility includes a mezzanine-based picking area, where shelf carrying robots ferry items to picking stations, with orders then routed downstairs for packaging.

Paul continues: “We're fulfilling D2C orders from multiple customers in the same space, using the same kit, dynamically picking items from different vendors that are side by side on the shelves.”

The picking area is replenished from a pallet storage area on the ground floor, with the software managing inventories from different retailers together, and demand from the consumer drawing down pick volumes and pushing replenishment. 

It all adds up to an efficient operation that can match resources cost-effectively to demand, catering to the order profile demanded by eComm.

Rapid change

But why has this kind of solution emerged now?

Paul explains: “The rapid change of the macro environment has been crucial, the speed at which customer habits have changed, not least in the last few years. 

“We were a traditional sort of industry where players hadn't been proactive in investing in solutions for the future. We've leant heavily into this change, and Wincanton is now bringing a variety of innovative solutions to solve problems proactively for customers.”

So, what is the key attraction of these solutions?

One of the key benefits for customers is being able to quickly adapt to change without having to make a huge investment and build new infrastructure to serve new types of orders. 

So, a small retailer that finds its mix of orders leaning more towards online does not necessarily have to build a new supply chain to service those orders, nor do it inefficiently by bolting online fulfilment on to a service that was designed for store replenishment. Instead, they can outsource those orders to a shared user facility that can serve the end user and save money.

“It’s very much around speed and availability to actually make something happen. There's clearly opportunity for customers and logistics partners around the sharing of fixed costs.

“One of the reasons we acquired Cygnia was to allow us to service customers who were seeing their order profile become increasingly omni-channel.

“Within that, we can offer a blend of services to customers, catering to a certain channel to market, such as returns management, or we can offer a full service.”

Bots can do more than shelf-to-pick

Where next for these tech solutions at Wincanton?

Wincanton has been using robots for shelf-to-picker type operations, and it sees this rolling out to new facilities, but the next stage could be focused on picking from tote boxes. These automated robot systems are a variation on the ASRS / miniload type operations that have long been on the market, but are said to be cheaper, quicker to deploy, and more adaptable than traditional fixed automation.

Paul explains: “We have projects that focus on tote operations, and we already have automated storage and retrieval systems deployed. But we see an opportunity for utilising AMRs in tote operations, and we are also looking at similar solutions for case picking operations. 

“The case picking side is interesting because we work with multiple customers carrying out this task, both food and non-food retailers.”

One other live project the logistics service provider is currently engaged in focuses on cross-dock operations.

“This is in a traditional chilled environment,” says Paul. “A facility that is heavily people-oriented, and we are looking at automating the sortation element, from goods-in, swiftly to goods-out.”

In all of these cases, Wincanton is working with technology partners. 

Orchestrating in a complex arena

This is a good insight into the future of the warehouse, increasingly technology focused, and not necessarily with a single technology partner, or even with a chief technology partner. This makes software, already so vital in terms of managing orders and coordinating robots within individual systems, arguably even more important. This is because software will be required to orchestrate processes throughout the facility, often involving the movement of goods between different proprietary automated systems.

Wincanton is busy developing this orchestrating capability, in order to coordinate an increasingly complex arena of automated solutions so they all chime together, and they all serve the customers seamlessly.

Paul enthuses: “To tackle this issue, we’ve developed what we call our automation hub to handle ongoing integration of technology, and we're in the process of developing that orchestration capability, the warehouse control side. We have a number of ways we're exploring this, from both a partnering and an M&A perspective.

“Ultimately, we will be the prime solution provider, with the relationship with the customer. Inevitably, we'll work with multiple partners on that journey.”

Scouting

Many 3PLs have embraced technology to sharpen up operations. Wincanton is a pioneer in this respect is, for example, in its stand-out W² Labs programme, which invites warehouse and logistics related start-ups to compete for the chance to trial their solution in a live environment with Wincanton.

W² Labs is about identifying future strategic partners, somewhat like the youth system of a football team, trying to spot and develop the stars of tomorrow. It isn’t just about spotting talent though, it’s about working out how the talent will fit into the team, solve a problem for Wincanton and ultimately serve its customers.

“We’ve been running the scheme for five years, and it runs very much like a Dragon's Den type process, where start-ups compete for the chance to pilot their solution in one of our operations,” says Paul.

“We look for a senior leader at our organisation to sponsor that pilot, and that's a managed programme of 10 weeks, after which we decide if it’s something we can go on with.”

A changing market

The technology plays a part, but ultimately it comes back to reacting to the market and serving the customer. The retail market has seen very significant market shifts in recent years, notably with eComm booming during the pandemic and easing back somewhat in its aftermath.

Paul comments: “Looking at eCommerce, there has been slower growth, but overall, we are not going to see things step backwards in any significant form. There's certainly a need to be more agile and value oriented. We’ve seen some of the larger brands we work with go full circle in an omnichannel sense, with stores now getting back to, or even exceeding, where they were pre-pandemic.”

This year has also seen rising interest rates and tighter capital markets, with many companies struggling for access to capital or preferring to invest what they have in the front end, engaging with their customers and driving sales. This presents an opportunity for logistics service providers.

“With us, it’s about much more than funding,” Paul says. “A customer is always going to want to see something in terms of value that they can't do themselves. It’s therefore more about the package - how we bring a solution together, how quickly we can deploy.”

Paul concludes: “We start with the customer. What's the external environment doing and what are the problems that our customers are trying to solve? That’s our priority and focus, and the rest flows from that, from our W2 programme to the technology partnerships and everything else.”