The fulfillment center of the future (yes, there are robots)

When Scott Gravelle looks at an ant colony, he doesn’t see a group of potential picnic-ruiners running around aimlessly. He sees the future of retail fulfillment.

“When ants build their colonies, they truly do it in three dimensions. And we applied that idea of successful natural systems to what we believe was a fulfillment engine for modern commerce: Something that combined flexibility, scalability and allowed for different granularity,” said the CEO, CTO and co-founder of ATTAbotics, a 3D robotics supply chain system for modern commerce.

Gravelle spoke at the recent NRFtech conference in San Francisco, where he was joined by Forerunner Ventures General Partner, Eurie Kim, in a session titled, “Innovation in the supply chain: New technologies to accelerate commerce.”

How the Kardashians stress out supply chains

Fulfillment is a major issue in modern commerce, Kim noted. Her firm has invested in some of the biggest online retailers, including Warby Parker, Bonobos and Glossier, but they all have one big focus — and an associated pain point. “It’s all about the consumer. It’s an amazing time to be a customer. You want what you want, when you want it, how you want it. Now the reality of that is setting in. More customers is better, but how am I going to make money off of this? So here we are trying to figure out what to do on that back end.”

The legacy supply chains retailers are working with can’t keep up with the demands of today’s customers. “The technology teams have done a great job working with retailers in maintaining customers and gaining customers and giving them lots of options on how to purchase and how to engage with the brand in the store,” Gravelle said. “But at the end of the day, the supply chain has been left trying to fulfill in all of those new channels. The technology they’ve been left to work with have been designed to send caseloads out to bricks-and-mortar stores almost seasonally. Now you’re sending out on demand and what Kim Kardashian tweets this afternoon could be what you’re shipping tonight.”

How modern commerce fulfillment will look

As a result, retailers are looking at new technologies and store models that can manage their supply chains and make inventory management, distribution and customer delivery more efficient. “Retailers are asking us to find a way to get away from sending cases,” Gravelle said. They want to minimize the number of times a product is handled throughout the supply chain, from the warehouse to the sales associate.

"Fixed linear infrastructure is not the future. [It needs to be] modular, expandable, scalable, so that technology investment can grow with your company as it grows and changes." Scott Gravelle, ATTAbotics

That’s where ATTAbotics comes in. Its 3D robotic goods storage and warehousing system replaces the row-and-aisle concept of warehouse and fulfillment to make it more, well, ant-like, moving away from the large, hub-and-spoke warehouse system to small, agile, nodal delivery stations. “We take all that two-dimension distribution of goods and smash it into a high-density storage matrix,” Gravelle said. The entire storage and retrieval system is bin-based and 3D robotics move the bins around — and it’s modular, scalable and expandable.

That flexibility is particularly important since retailers often have to make capital investments in supply chain infrastructure up to five years out, Kim said. “The spoke-and-hub model doesn’t support modern commerce,” Gravelle said. “I encourage you to make any thoughts or investments in the future on something that can change as quickly as your business may change, because you’ve seen how quickly your businesses have changed already. Fixed linear infrastructure is not the future. Think about it that way: Modular, expandable, scalable, so that technology investment can grow with your company as it grows and changes.”