I am back from a busy and fascinating week at ProMat 2023 in Chicago. Another record-size supply chain show with the most striking evidence that supply chain is maturing and becoming a more professional and mission-critical part of major companies. It seems that the days of mullets and double denim are gone, as we now have business casual attendees talking about supply chain agility and adapting to customer demand by innovating in the warehouse.
These are exciting times to be in the world of supply chain solutions and, in my opinion, a great step in the right direction. So, let's recap my take on the three latest trends in warehouse management and automation we saw at ProMat 2023.
Automation is everywhere, but very few large projects
With warehouse automation being the topic of choice, it was everywhere you looked. One analyst I talked to told me that he had counted up to 300 exhibitors that either made or implemented warehouse automation at the show. Locus reportedly had 100 people visit them at ProMat; their booth was massive and so were the booths of many of the other automation vendors. They had clearly bet big on automation being one of the latest trends in warehouse management and greatly expanding their position in the marketplace.
Interestingly, project delivery lead times have not really improved much, with reported 18-to-24-month project deliveries on the larger types of automation technologies. This huge lead time seems to be leading to growth in the less complex but complementary automation projects like tugs, forklifts or even more traditional warehouse solutions that will work alongside the larger automation projects once they are finally delivered.
Automation software is early in the maturity cycle
As one of the latest trends in warehouse management, automation has to be recognized as a melding of smart hardware with software to optimize the use of the technology and assist in integrating it into the rest of the warehouse environment. Unfortunately, this software tends to be immature and, with the exception of some standouts like SVT, is really in its early versions. This can be observed by looking at the lack of standardization in the integration, lack of consistency in the UX and lack of agility in process workflow control. The leaders in the automation space will have customers that drive this maturity but expect some bumps along the way while new versions of the automation brain are rolled out.
One type of automation solves one warehouse problem
Another aspect we are seeing in this immature marketplace is that most automation is designed to solve one warehouse problem very well, but not much else. For example, most collaborative picking robots are amazing at picking for e-commerce, but when it gets to replenishing the pick locations, they don’t help much. The issue becomes that implementing one type of automation is easy, the second one not so much since you have to make sure that they work effectively together and don’t cause friction at the junction point of the two systems. As automation matures, we are sure to see more generalist automation solutions that can be configured to handle multiple tasks and allow interleaving of tasks, and also software that optimizes these various automation technologies by making them work in concert rather than as independent systems.
What will we see at ProMat 2025?
We are obviously at the early point of growth for warehouse automation in North America and the automation marketplace is getting very crowded and overleveraged by VC-backed startups and unproven technology providers. Based on the latest trends in warehouse management, I predict we will see significant consolidation in the marketplace and the leaders will mature their ecosystems into more agile and open environments by the next ProMat. What does that mean for you? Exciting times in the warehouse marketplace with lots of opportunity to be early in the game of automation in the warehouse, but also a time for caution while these vendors figure out if they are in it for the long run.