November 25, 2014
Two years ago, Amazon acquired robot manufacturer Kiva Systems for $775 million. The orange, wheeled robots have been used by a number of retailers in warehouses across the country. In an effort to improve efficiency, Amazon CEO Jeff Bezos has announced plans to deploy thousands of these robots across Amazon warehouses. The robot army is designed to bring stocked shelves to employees, reducing the time workers would have spent looking for items on their own.
Amazon currently has robots operating out of a California warehouse near San Francisco. “Now, ‘pickers’ at the facility stand in one place and wait for robots to bring four-foot-by-six-foot shelving units to them, sparing them what amounted to as much as 20 miles a day of walking through the warehouse,” reports The Wall Street Journal.
“Employees at some robot-equipped warehouses are expected to pick and scan at least 300 items an hour, compared with 100 under the old system, current and former workers said.”
Amazon’s investment in Kiva was a strategic play to expand the number of items that can be delivered to customers on the same day or overnight.
“The robots could also help Amazon save $400 million to $900 million a year in so-called fulfillment costs by reducing the number of times a product is ‘touched,’ said Janney Capital Markets analyst Shawn Milne,” notes WSJ.
Over the years, these fulfillment costs have been one of the company’s greatest challenges. Where Amazon has reported losses it has seen a simultaneous increase in fulfillment cost.
With the holidays right around the corner, these robots are likely to help Amazon meet its heavy demands. According to sources, the robots are confirmed to be working in warehouses in California, Kentucky and Texas.