Urban Networks Help Omni-Channel Fulfilment In Food Retail

Smart solutions, including intelligent automation technologies, make reconciling online and offline markets possible.

KNAPP's initiative, New Urban Logistics, equips retailers with the tools to tailor their urban omni-channel networks precisely to their needs. 

The portfolio also provides smart, micro-fulfilment solutions to speed up online orders in urban areas. Numerous food retailers around the globe rely on KNAPP's automation concepts.

Along with large high-performance fulfilment centres that efficiently supply several countries, smart solutions are becoming increasingly important, especially for urban areas. 

They require agile logistics networks where the flow of goods, people, processes and information are intelligently interconnected to master the challenges of the last mile, in particular. 

Automated MFC As Long-Term Solution

Takeoff Technologies and KNAPP, as an expert for automation solutions, developed the Micro Fulfilment Centre (MFC) as a solution for brick and mortar and online food retail, especially in urban areas. 

KNAPP's turnkey solution, E-Grocer MFC, allows food retailers to enter the business quickly and at a reduced cost. 

The solution combines the convenient proximity of brick and mortar stores with the automation possibilities of large CFCs. 

The consumer has access to the whole item range, since the automation solution is directly connected to a store or branch store and, in comparison to manual picking, rapidly processes online orders. 

Since MFCs are located close to the consumer, same-day delivery is possible, with the ordered items available for pickup or delivery in a short time. Last-mile costs are therefore comparatively low. 

The solution is in use around the globe in several stores run by different food retailers. 

Today, Takeoff and KNAPP's automated micro fulfilment network is already processing more than 45,000 orders per week. 

By the end of 2021, the network will support over 100,000 digital orders per week across four continents. 

Proof Of Concept

The concept gives KNAPP several years' head start on the competition. Moreover, the experience gained by implementing several MFC solutions for various food retailers has allowed KNAPP to become a strong player in the sector. 

Thanks to the standardised, modular solution, retailers are able to set up efficient e-commerce fulfilment within a few weeks. 

Jewel Hunt, group vice-president of e-commerce at Albertsons, summed up the key benefits of using MFCs, saying, "We can fill orders five times faster, and it puts us in the right position for continued growth. We feel good about where we're at." 

Woolworths Growth In Online Food Retail 

One of KNAPP's latest deployed MFC projects was together with the Australian supermarket giant Woolworths. 

Australia's largest supermarket chain has invested in this automation solution to keep pace with the fast-growing demand for online groceries in Melbourne, Victoria. 

The MFC concept makes processes in the online food retail business faster, smoother, and less prone to errors. 

The 4,300 square-metre MFC is directly connected to Woolworths' Carrum Downs supermarket and processes five times more online orders than conventional online stores using manual picking processes. 

Woolworths' customers in southeast Melbourne can choose from a selection of more than 15,000 products. When an online order involving shelf-stable goods is placed, these goods are automatically retrieved from the OSR Shuttle™ Evo and supplied to employees working at the ergonomic Pick-it-Easy work stations. 

Employees receive precise guidance from the system to make sure the correct items always end up in the right shopping bag. However, fresh fruits and vegetables, as well as meat products and cold cuts, are still picked by employees in the supermarket. 

Thanks to the smart combination of manual and automated processes, the orders are delivered to customers' homes in next to no time.

"The micro-fulfilment solution helps us deliver unparalleled speed and accuracy in the online picking process while keeping us close to our customers for faster and more flexible deliveries to the home," said Amanda Bardwell, director of e-commerce at Woolworths Group.

Woolworths already has further MFCs with KNAPP and Takeoff technology at Carrum Downs, Moorehouse, Christchurch and Penrose, Auckland. Another site is under construction at Maroochydore, Queensland.

Central Fulfilment Boosts E-commerce Business

Woolworths is also partnering with KNAPP on its first automated online fulfilment centre in Auburn, Western Sydney. Innovative technologies will help Woolworths' personal shoppers pick and dispatch more than 50,000 orders a week. Auburn is the next stage of e-commerce investment, following strong growth and increased scale. 

Auburn will use the same underlying KNAPP technology at a much larger scale and is expected to deliver efficiency benefits as Woolworths unlocks new capacity for growth. 

Woolworths stores remain a key part of the e-commerce network, with investment to continue in pick up (including Direct to Boot), in-store fulfilment, and on-demand delivery.

Bardwell concluded, "Auburn and our other fulfilment centres play important roles complementing the work of our store teams. They help us better serve the most densely populated areas with the strongest demand for online groceries. 

"But even as we invest in new fulfilment centres, local stores remain the heart of our online operation. By making the most of our unrivalled national store network, we can stay close to our customers for faster same-day and on-demand delivery options, as well as convenient pickup solutions."

Rise Of Micro Fulfilment In Europe

A French food retailer also relies on KNAPP's MFC solution. Using the micro fulfilment concept as a dark store, instead of deploying it in combination with a single shop, more than one retailer can profit from the solution. 

The retailer was searching for a possibility to automate the fulfilment of online orders to reduce the effort in the surrounding supermarkets and increase turnover and service quality. 

Manual picking of online orders directly in the supermarkets had generated high costs and affected consumers' shopping experience in the store. To solve this situation, KNAPP developed the concept of an MFC fulfilment hub, which would serve several supermarkets in the vicinity.

This innovative approach offered significant advantages – workload at the stores were eased, enabling food retailers to provide attractive customer experiences both online and offline. 

Since the MFC fulfilment hub is a joint investment by the proprietors of the supermarkets in the area, the entry costs for the parties involved are very low. 

An innovative e-commerce hub in contrast to the classic MFC solution, the automated warehouse is not directly connected to the supermarket but operated as an independent dark store. 

In this warehouse, the online consumer orders are filled and supplied to the supermarkets in the vicinity. The groceries are then either delivered to the consumer's home or provided for pickup. 

So far, 14 food retailers within a 25-kilometre (15 miles) radius of the MFC have decided to join in and use this automated hub for their online order fulfilment. 

The French food retailer is planning to establish a comprehensive MFC network to support multiple supermarkets in their automated online order fulfilment.