Retailers globally turn to robots in cost inflation fight

LONDON: At a vast warehouse in the southern Dutch city of Roosendaal, automated cranes and driverless vehicles silently stack clothes for the French and Italian stores of retailer Primark, reducing the need for hard-to-come-by labour.

With goods packed more densely up to its roof, the new warehouse, which spans the size of over 15 football fields, reduces the need for extra sites and workers - leading in time to a lower cost base.

Whileretailhasbeenslowertoadoptautomation than sectors such as autos and electronics, it has been picking-up the pace - from the introduction of basic self check-out tills in stores to the use of robots and AI in supply chains.

Now tight labour markets, rising wages and consumer spending pressure are forcing the industry to go further.

Global installations of industrial robots grew 31 per cent in 2021 year-on-year, while sales of service robots rose 37 per cent, with the retail sector a significant driver of both, according to the International Federation of Robotics.

Mark Shirley, head of logistics at Irish-founded Primark, said the 25 million euros ($26 million) investment in the Roosendaal site’s automation would deliver an 8 million euros per year benefit from year four, in addition to savings from not having to lease another warehouse.

He estimates the use of automated cranes rather than manual fork lit trucks has increased the site’s efficiency by 80%.

And crucially, the use of autonomous vehicles means the company no longer has to compete in the extremely tight Dutch labour market, a challenge felt in many advanced economies.