Online grocery shopping is absolutely on the rise in the United States. While shopping online for necessities like food, toiletries, or cleaning supplies makes the entire process more accessible, and sometimes even more affordable, it can be tough on small businesses. Due to limited staffs, budgets, or technological resources, not all mom and pop stores can compete with the near-instant delivery available from larger retailers.
CommonSense Robotics hopes to help them out by creating fulfillment centers that uses robots to cut down on labor and costs. This could even provide faster, cheaper delivery for customers, in addition to more options for grocery shopping.
Unlike large warehouses that are used by many retailers, CommonSense Robotics would establish relationships with local grocery stores, giving the process a more community-focused feeling. It would also operate in small spaces. This is an ideal concept in urban neighborhoods for retail spaces that aren’t high in rent. They could also utilize an underground facility like a parking garage they’ve used in their own offices in Tel Aviv when testing out their system.
How is the startup planning to fulfill many orders in smaller places? They’re cutting human labor in half by using robots to organize and retrieve the needed food items for an order. While the exact process hasn’t been shared, there’s likely a mixture of human and robot packaging for delivery. Fresh items like produce and meat are likely looked over by the human eye while other products like canned goods and boxed items are done by the robot.
Stores would be responsible for taking care of the delivery aspect, whether they hire people themselves or bring in a third-party company to complete orders. Since many grocers don’t utilize delivery because of the negative impact in costs, the micro-fulfillment center is designed to balance those out.
“We’re paying a fraction of the rent compared to [storefront on a main street], we’re using a lot less labor, and we’re doing it a lot faster,” Elram Goren, CEO of CommonSense Robotics, tells FastCompany. “It changes the economics of the situation, and that allows retailers to offer faster, cheaper delivery.”
Advantages of this system would be quick delivery of fresh items, something that major retailers are limited in doing. This could balance out smaller companies with healthier choices with the giants that are offering low-cost alternatives that aren’t as healthy. These fulfillment centers could also be shared with nearby stores to cut costs even further.
The ideal scenario would be to keep prices similar to those purchasing groceries at the store. However, there would be a small fee per order charged to the store to pay for costs of the fulfillment center. That may bring in delivery fees for consumers, but most grocery stores that offer delivery currently have implemented those fees or require a certain dollar amount of items being purchased.
Smaller stores offering more delivery options and competing with major retailers seems like a win for the consumer. They’ll have healthier options to choose from, delivery times will be cut down without the need to reach larger warehouses in more isolated areas, and local stores will be able to survive as more and more people are switching to online grocery shopping. The first micro-fulfillment center will open in Israel this year, and the United States will likely be next.
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