Woolworths launches first mini automated packing centre
Woolworths is hailing its latest online shopping initiative – to be launched in Melbourne – as a potential game changer. Here is what is happening.
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WOOLWORTHS will flick the switch on what it hails as a “potential game changer” for its online shopping offer as its first mini-automated packing centre whirls to life.
The centre, built at the back of a supermarket in Melbourne’s outer southeast, uses a fleet of nimble robots to help prepare online orders.
Woolworths chief Brad Banducci said the facility would enable the Carrum Downs store to process five times as many online orders, opening up more delivery window opportunities for shoppers in the area.
“The micro-fulfilment technology in this Carrum Downs e-store is a potential game-changer,” he said.
“It will help 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.”
The facility will begin operating on Friday.
Woolworths will open another three mini centres – two in New Zealand and one in Australia – in the coming months.
The centres, fitted out by US automated grocery fulfilment specialist Takeoff Technologies, will process 10,000 dry grocery items.
Fresh items will be picked by staff.
Woolworths extended the Carrum Downs store to fit in the facility but it plans to shrink the customer facing retail space to accommodate the technology at other sites.
Woolworths’ online orders have more than doubled in Victoria in 2020 as the coronavirus pandemic spurs a permanent shift towards e-commerce.
Both Woolworths and Coles and pushing heavily into automation but they are taking very different paths in how they serve shoppers.
Coles is building two automated warehouses in Melbourne and Sydney that are dedicated to processing online sales.
Woolworths is testing a decentralised route, incorporating mini centres into existing stores.
Mr Banducci said the approach allowed Woolworths to be closer to customers, helping to solve the so-called ‘last mile of delivery’ challenge – the final delivery leg which stands as the most expensive and complicated part of e-commerce.
“We really think customers will want same day delivery so you need to have your home delivery capacity as close to the customer as possible,” he said.
The decentralised approach also makes use of the company’s existing footprint and provides the shortest delivery route to customers, a key advantage in large cities struggling with long-term congestion, Mr Banducci said.
“You can build an automated shed and make it extremely efficient but you can then blow all that saving if you have to drive too far to a customer,” he said.
Woolworths is getting ready to launch a wider rollout after assessing the performance of the first four sites, although not all stores would be fitted with the centres.
“What would hold us back is how much space we need to run one of these units – we don’t want to ruin the in-store shopping experience,” Mr Banducci said.
Originally published as Woolworths launches first mini automated packing centre