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Could Your Groceries be Entirely Automated?

COULD YOUR GROCERIES BE ENTIRELY AUTOMATED?
 August 25, 2021 |  CRE News, Investment |  real estate trends, warehouse, special purpose facility, light industrial

Grocery warehouses have been gaining popularity after the surge of online shopping during 2020. The convenience and quick delivery times of digital ordering are transforming your usual trip to the supermarket. Now, delivery companies like Instacart are entering the warehouse market and starting their own Amazon-like fulfillment warehouses.

The Beginnings of E-Groceries
Amazon began offering two-hour delivery on groceries for its Prime members in 2019, which became more popular at the height of the pandemic. As people stopped going out, web searches for food deliveries hit an all-time high. Other brands like Instacart and Shipt saw almost double the amount of orders in 2020 compared to previous years. Even with restrictions dropping and people returning to business, many shoppers still like the convenience of having someone else run to the store. It’s predicted that by 2024, online grocery shopping could grow to make up nearly 14 percent of total e-commerce in the U.S alone. (via eMarketer).

Major Chains Building MFCs
In April of 2021, Kroger opened the first customer fulfillment center in the U.S.. Inside the warehouse, a team of robots completed a 50 item order in only 5 minutes. By 2023, Kroger plans to open six more fulfillment centers. Walmart has also begun automating their warehouses, and is looking into building micro-fulfillment centers (MFCs). The retail giant has seen success with their automated distribution center in California as a model for their other centers.

Instacart Going from Shopping to Shipping
Recently, grocery fulfillment company Instacart has also entered into the supplying side of online groceries. The so-called “dark store” would utilize new technologies to fulfill orders faster and more accurately. Instacart plans to use machines to pick out and package items for drivers to deliver to the customer. There’s also the potential to substantially lower costs on the end of the supplier and the shopper. If it proves to be a viable option, Instacart plans to open around 50 of the “dark stores.” However as great as it seems in theory, there are still bumps in the road.

A Work in Progress
The plan for Instacart’s “dark store” isn’t completely free of bugs. For starters, there’s the question of machine reliability. Orders can get mixed up and robots break down, causing a backlog and delaying shipping. It might also take some time for Instacart to work out agreements with their major partners. Right now, retailers are worried about having another potential competitor enter the market and divide the customer base.

MFCs Becoming More Improved
As more micro-fulfillment centers pop up, retailers are figuring out how to further streamline the process. Full automation, while not perfect, would help speed up orders and overall efficiency. With 5G becoming more widespread, it’ll significantly improve communication between machines and the people in charge of them. Customers might also notice less delays in submitting orders while shopping online due to a faster, stronger network. Better broadband paired with advanced machines will make MFCs smarter than before.

The Grocery Store of the Future
It’s hard to imagine a grocery store that you don’t even have to walk into. Though traditional stores will most likely never fade away, your online experience certainly could. Big retailers continuing to expand fulfillment centers would make deliveries faster and cheaper. Grocery stores not typically meant to fulfill multiple orders at once are able to leverage MFCs to relieve some of this stress. There are still some things to work through but as other shopping companies build distribution centers, your groceries being one click away is getting closer and closer.

For all your commercial inspection needs, contact National Property Inspections. Our inspectors are trained to assess and report on all of your building’s major systems. Call 402-333-9807 ex. 30 to book your inspection today!



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