Amazon first displayed interest in the integration of robots into their facilities in 2014, when they bought Kiva Systems that year for over three-quarters of a billion dollars. The premise of this purchase was to utilize the robots to make their warehouse operations more efficient, with robots engaging in certain tasks that humans completed with unnecessary delay. However, just recently, the amplitude of the value of these robots is beginning to show.
The robots Amazon employs in their warehouses are used for searching for, packing, and shipping packages. It is reported that this process originally took sixty minutes when completed by human workers. Now, courtesy of Amazon robots swarming the warehouses, this process is now completed in fifteen minutes.
What makes these robots so helpful goes beyond their efficiency. These robots are shown to take up less space than a human worker, allowing them to move and engage in actions regarding parcel manipulation in smaller spaces. When warehouses are able to fully depend on these robots, they can shrink aisle sizes, allowing the warehouse to fit more packages. An article on Quartz reports that warehouses utilizing Kiva robots can hold up to 50% more inventory. It has also been reported that operating costs have been cut by 20%.
The downside is that these robots are nowhere near cheap. In fact, setting up these robots in a single warehouse can cost over $15 million. While the money will pay itself back through operating cost cuts, the execution of the robot setup needs to be done over time, so Amazon can earn back the money lost from robot setup. On top of this, Amazon is looking towards other robots for their warehouses that can handle more complex and articulate tasks. Two decisions will need to be made: which robots come first, and when should these be fully integrated into warehouses?