Why Automation is Key to Winning the Grocery Talent Wars | Exotec

Step Into Your Future Warehouse at Modex | Booth B4202

Why Automation is Key to Winning the Grocery Talent Wars | Exotec

August 8, 2023

Article Brief

  • Labor shortages have rippled through the grocery industry since the onset of the COVID-19 pandemic. 
  • Robotic automation is providing new solutions to labor strains, helping the industry meet surging demand for e-grocery and steady demand for curbside pickup. European grocery providers are leading the adoption of these technologies as their North American counterparts follow suit.
  • Warehouses across Europe and North America are embracing robotic solutions such as the Exotec® Skypod System to improve working conditions for employees while boosting productivity.

The Struggle for Talent

Let’s face it: The grocery industry is struggling to retain workers.

This trend took hold during the pandemic — 2020 saw attrition in the grocery retail sector jump to 60%, a 50% increase from the previous year, according to the Food Industry Association. The industry hasn’t recovered since. By 2022, North American grocers were still competing to “win the talent war” as they faced the pressures of supply chain disruptions and calls for wage increases to match inflation. The labor market remains tight in 2023.

“Over the past two years, grocery retailers have had to reassess and adapt nearly every facet of their operations,” says McKinsey’s 2022 state of the grocery industry report. “Every aspect of the industry’s people model — corporate, in-store, and across every part of its operation – is experiencing an upheaval.”  

An Industry in Transition

Grocery businesses around the world are learning that automation is crucial to meeting their customers’ evolving demands. With steady demand for e-grocery, curbside delivery and in-store shopping picking up in the wake of the pandemic, warehouses must be increasingly agile to meet a mix of fulfillment needs.

McKinsey estimates that one-third of grocery retail tasks could be automated in the next eight years, and the global warehouse automation market is slated to balloon (it was valued at $13.6 billion in 2021 and projected to reach $58 billion by 2031, according to Portland, Oregon-based Allied Market Research.) But few roles can be fully converted, McKinsey notes, so it’s up to grocery providers to find ways to weave automation through their workflow to complement, not replace, their workforce. 

“There’s a disconnect between the factors employees regard as important and those employers think are important,” according to McKinsey. “If the past 18 months have taught us anything, it’s that employees are craving investment in the human aspects of work.”

And demand for specific employee skills is shifting in turn, McKinsey’s report notes. Physical and manual skills are losing importance in the grocery workforce – they are projected to decline in impotance by 17% by 2030 from 2016 levels. Meanwhile, the importance of higher-level cognitive skills and social and emotional skills is surpassing the importance of basic cognitive skills. Grocery workplaces are changing, and workers are adjusting to follow.

Carrefour’s grocery fulfillment center in Le Plessis-Paté, France

What North American Grocery Warehouses Can Learn From Europe’s Embrace of Automation

The shift in warehouse workflow is racing ahead in Europe, where grocery warehouse automation has accelerated at a far faster rate than in the U.S. In the past five years the e-grocery sector across Europe has grown by more than 50% compared to 2019, and retailers are enlisting automation in response: Some 55% of retail, manufacturing and logistics professionals, including in the grocery industry, have said they’re investigating automation in their warehouses. In 2023, the EU automation market for retail, including grocery, was worth USD $2.7 billion, slated to increase by 13% within the next decade.

That left grocery chains like France’s Carrefour without a choice but to revolutionize the way they work. The company has invested in the Exotec Skypod Systema robotic goods-to-person warehouse solution, across four of its micro-fulfilment centers. The Exotec solution consists of a fleet of autonomous mobile robots that move goods between high-density storage racks and ergonomic picking stations without the use of conveyors or heavy machinery. 

The Skypod system reduces physically strenuous and repetitive tasks, such as bending, lifting, and walking, that manual warehouse workers perform daily. Employees work from ergonomic picking stations equipped with intuitive screens that provide users with prompts for order picking and inventory replenishment. This has enabled Carrefour to shift much of their warehouse labor to more value-add tasks while finding greater success in attracting and retaining workers who would prefer to work with innovative robotic systems than hurriedly navigate through miles of racks in search of ordered goods. 

This streamlining of the order fulfillment process led to a slew of benefits at their facility in Le Plessis-Paté:

  • Preparation reliability increased to 99% for all orders
  • Increased throughput of more than 13,000 product references by 4x
  • 2-hour home delivery enabled thanks to ability to access any SKU in the system within two minutes
  • Utilized entire height of warehouse to increase storage density by 4x
  • Fulfilling up to 4,000 orders each day with consolidation of manually picked items
  • Robots retrieve items from storage and bring them directly to operators at ergonomic picking stations

To view a case study on Carrefour click here.

The Skypod system can retrieve any item within two minutes or less and achieve throughput of up to 400 lines per hour per station. For Carrefour, a chain with more than 12,000 hypermarkets, grocery, and convenience stores, the impact was huge. 

“The Skypod system allows us to work on production non-stop,” says Mohammed Ben Aissa, director of logistics at Carrefour. “This allows us to respond to very tight customer demands with almost 100% satisfaction.”

Not to mention, the system is fast to install while limiting disruption to ongoing operations. Carrefour’s quickest Skypod system installation took just six weeks. They look to utilize their system’s ability to quickly scale throughput and storage independently to meet their exact needs as their business grows over time. Within the Skypod system, throughput can be increased within minutes by simply adding robots. Storage racks and picking stations can be expanded over the course of a weekend. 

North American grocery warehouses can learn from Europe’s embrace of tools like this one. Robotic automation has become a “must have” across the pond – and this is quickly becoming the case in North America. Moving forward, as the grocery industry evolves and e-commerce demand surges across the globe, automation will be a key lever for retailers to increase efficiency and speed.

Your Warehouse is Complex, Your Automated Solutions Don’t Need to Be

With the complex challenges modern warehouses are facing, ensuring your solutions are built with the highest standard of quality and performance is crucial to success. The Exotec Skypod system can help you transform the most fundamental aspects of your warehouse with elegant goods-to-person warehouse robotic solutions. 

The Skypod system is fully modular allowing customers to deploy in a matter of weeks and easily expand without interrupting production by simply adding robots, picking stations, or storage racks. 30+ industry-leading brands including Carrefour, Decathlon, Gap, and Uniqlo trust Exotec to improve their operations and profitably navigate rapid shifts in business models while meeting customer expectations.

Ready to learn more about warehouse robotics? Fill out the form below to stay connected via our newsletter.

Ready to transform your warehouse?

Let us show you how we can take your order preparation to the next level.

Featured In

Share