Flipkart`s Move toward Automated Supply Chain Management |
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| According to operations experts, while storage and inventory management comprised 60% of the entire supply chain cost, warehouse operations constituted 25% of the entire supply chain cost. Most Indian e-commerce companies seemed to be unaware of the importance of supply chain management, especially warehouse operations management, in efficient cost management. Moreover, the use of technology in Indian warehouses was dismal with most basic operations such as sorting, picking, storing, and documenting done manually, resulting in inefficiencies and errors. |
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| Flipkart learnt that AI (Artificial Intelligence) coupled with the robotics process of automation increased delivery output by almost 200%, made efficient use of existing space in the warehouse, reduced lead time, lowered operating costs (OPEX) , streamlined revenue processes, and eliminated errors... |
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| The Butler system was an automated inventory storage, replacement, and order picking facility that was usually deployed at warehouses, fulfillment centers , and distribution centers. It consisted of an advanced autonomous mobile robot called Butler; Mobile Storage Units (MSU) or racks; pick-put stations; and Smart Charging Stations. . |
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| The Sorter was an advanced robotic sortation system that automated the sorting processes in warehouses and fulfillment centers. Two double-deck and five single-deck sorters of capacity 6,000 sorts/hour each, apart from four sorters of capacity 3,000 sorts/hour each were installed at Flipkart’s Hyderabad fulfillment center and eight transport centers... |
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| Though automation was a costly affair requiring heavy investment, it was expected to provide a host of benefits. GreyOrange estimated that the typical return on investment (RoI) for warehouse automation was usually achieved in around 18 months of operation. The life of the system was estimated to be around 10 to 15 years, while actual savings would begin from the third year. . |
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| Though automation was a costly affair requiring heavy investment, it was expected to provide a host of benefits. GreyOrange estimated that the typical return on investment (RoI) for warehouse automation was usually achieved in around 18 months of operation. The life of the system was estimated to be around 10 to 15 years, while actual savings would begin from the third year. . |
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| As of 2017, GreyOrange was one of the top 50 robotics companies in the world in the area of automation technology. It had a near monopoly and held almost 90% of market share in India’s warehouse automation market. Apart from Flipkart, other e-commerce companies like Myntra, Jabong , and DTDC had adopted its automation technology, resulting in the company growing 300% year-on-year during the five years of its existence. |
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Exhibit I:Categories of GreyOrange Butler robot
Exhibit II: Benefits of GreyOrange Butler System
Exhibit III: Benefits of GreyOrange Sorter System |
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