This is our last weekly news roundup before for the Thanksgiving holiday. It’s hard to believe that we are getting ready for stuffed turkey, mashed potatoes, and pumpkin pie. So, what does the 2022 Thanksgiving holiday look like? In a recent NielsenIQ survey, 91 percent of consumers indicated they are planning on celebrating US Thanksgiving this year with a majority (83 percent) either staying at home (59 percent) or local (24 percent) (within 50 miles of their home). More than 50 percent of consumers surveyed noted that their gathering size range will be less than 10 people. More importantly, consumers are putting comfort first this year. During this year’s Thanksgiving celebration, 24 percent of respondents indicated they planned to dress up, while the remaining 76 percent plan to put their comfort first, wearing adjustable pants or sweatpants. Thankfully my extended family swings toward the casual size, so it will be sweatpants for me as I enjoy turkey, all the fixings, and a rare Patriots Thanksgiving night game. And now on to this week’s logistics news.
Amazon unveils smaller drone that flies through rain
How Walmart automated supplier negotiations
Target pivots to larger stores with new 150K-square-foot format
Rail strike could cost economy billions
DoorDash adds Sephora
Pickle Robots are unloading trucks
Vertical storage as a solution for online grocery fulfillment
Warehouse demand undeterred by economic turbulence in third quarter
Amazon unveiled a new delivery drone that’s smaller, makes less noise, and can fly through light rain, the latest effort to get the troubled and long-developing project off the ground. The company has spent nearly a decade pursuing founder Jeff Bezos’ vision of autonomous drones that can deliver a package weighing less than 5 pounds as little as 30 minutes after a customer places an order. The new drone, dubbed MK30, will go into service in 2024 and replace the existing MK27-2, the model that will be used to make deliveries in Lockeford, California, and College Station, Texas, this year. The new unit has a longer range, can fly in a wider range of temperatures, and has new safety features, Amazon said.
It seems bots are becoming the answer to many of life’s problems (although in case of trying to get my daughters Taylor Swift tickets, the bots were the enemy). And Walmart is jumping on board. The company has realized it cannot conduct focused negotiations with all of its 100,000-plus suppliers. As a result, around 20 percent of its suppliers have signed agreements with cookie-cutter terms that are often not negotiated. Unfortunately, the cost of hiring human buyers to negotiate with these suppliers does not make sense. So Walmart is using artificial intelligence–powered software that includes a text-based interface (or chatbot) that negotiates with human suppliers on behalf of Walmart. Walmart Canada piloted the solution in January 2021 and used supplier feedback to hone the system. Walmart has since deployed the solution in three other countries, and Walmart operations in more countries plan to implement the technology soon.
Target is introducing a new large-format store that will stand at around 150,000 square feet, which would make it roughly 20,000 square feet larger than its average, according to a company release. Target’s new larger format represents a pivot from its development focus of recent years, which brought an expansion in the retailer’s small-format concept tailored for urban areas and younger shoppers. The extra square footage includes five times more space for backroom fulfillment than its traditional large-format stores. The stores also have space for a deeper merchandise assortment, including room for an expanded food and beverage selection, according to Target.
The American Chemistry Council, which represents companies including 3M, Dow, Dupont, BP, Exxon Mobil, and Eli Lilly, says a rail strike would impact approximately $2.8 billion in chemicals cargo a week. The trade group says a rail strike of one-month could result in an economic impact of up to $160 billion, and within one week many chemicals manufacturing plants could shut down, lowering GDP and leading to more inflation. Part of its analysis is based on the recent strike preparation among freight rails that took place in September before a last-minute deal was reached, which caused a drop of 1,975 carloads.
DoorDash is adding Sephora to its marketplace offerings, marking the delivery service’s first foray in high-end beauty amid an overall expansion into new product categories. The partnership means DoorDash customers can shop from Sephora directly through the app and receive products from a nearby store within an hour. DoorDash is also launching a new “Beauty” category to highlight the incorporation. It’s part of an overall push by DoorDash to grow beyond its restaurant-focused beginnings. In late October, DoorDash added Tractor Supply to its app, its entrance into the farm category. And in September, it added Dick’s Sporting Goods as its first sports partner. For Sephora’s part, the move to DoorDash could mean more customer acquisition. On DoorDash marketplace, customers who search for any of the 340 beauty brands offered by Sephora can wind up placing an order.
Pickle Robot Company (“Pickle Robot”), a pioneer in AI-enabled robotic automation systems that unload trucks, announced it has live pilot implementations unloading tens of thousands of packages per month at customer sites in the greater Los Angeles area, and has raised $26 million in series A funding led by Ranpak, JS Capital, Schusterman Family Investments, Catapult Ventures, and Soros Capital. Additionally, Pickle Robot has added growth-oriented industry veterans to its leadership team to accelerate commercialization of the company’s flagship robotic unload systems. Founded in 2018, Pickle Robot tackled a number of warehouse challenges using industrial robots built on core AI software, computer vision, and advanced sensors. Today, the company is laser-focused on applying its technology to one of the most labor-intensive, physically demanding, and highest turnover work areas in logistics operations: truck unloading. ARC Advisory Group’s Clint Reiser pointed out that “Pickle Robot is a recent example of the Greater Boston robotics cluster expanding to propel new and innovative warehouse robotics.”
Spurred by the sustained increase in e-commerce business sparked by the pandemic, grocers are stepping up their interest in vertical storage systems, which allow workers to more efficiently assemble orders and can be less costly than other types of automated equipment. The mechanized units, which stack totes loaded with goods on shelves in multistory towers that can be more than 40 feet tall, have long been used in industrial settings, where they are prized for their ability to store and rapidly retrieve parts while requiring a minimum of floor space. Those qualities are now catching on with food retailers, which have until recently displayed relatively little interest in vertical storage systems even as they have invested in other forms of automation.
Demand for warehouse space is continuing to soar as retailers and brands hustle to meet simmering demand for e-commerce orders and fast home delivery that has stayed hot despite federal efforts to cool off rising inflation through interest rate hikes. In one measure of the trend, the industrial real estate firm Tishman Speyer this week launched a joint venture with Mitsui Fudosan America (MFA), the U.S. arm of the $65 billion Japanese real estate firm Mitsui Fudosan Co. Ltd. Fueled by $500 million from MFA and an unspecified investment from Tishman Speyer, the partners plan to acquire, develop, redevelop, and operate industrial properties in certain U.S. cities. The partnership will focus primarily on major urban centers with dynamic workforces, growing populations, and high barriers to entry, the companies said. They cited examples such as Los Angeles, the New York Metro region, the Puget Sound region, San Francisco Bay Area, Austin, San Diego, Washington D.C., Boston, and Chicago.
That’s all for this week. Enjoy the weekend, the long weekend for Thanksgiving, the opening of the World Cup, and the song of the week, Adam Sandler’s Thanksgiving Song.