Avoiding a hangover
Simon Jones, Senior Sales Executive at Exotec explores the benefits and potential offered by warehouse automation in the alcohol industry.
British alcohol businesses have experienced a revolution in recent years with the rise of craft beers, artisanal spirits and non-alcoholic options. Meanwhile, consumers are shifting away from pubs and bars towards at-home drinking experiences, largely fuelled by e-commerce and rising prices. Alcohol wholesalers, manufacturers and distributors must find new ways to adapt to beat the competition, and it all starts in the warehouse.
Is trouble brewing?
In the UK, the wholesale market for alcoholic beverages is estimated to be worth £18.4bn, with home delivery services contributing to this post-pandemic. Many alcoholic beverage manufacturers and retailers have established an online presence to tap into this growing market, which is expected to increase by 5% each year between 2024 and 2029.
Brits are also turning to low- and no-alcohol products, while customers are also spending time finding the ‘right’ product, choosing quality over quantity.
This is great news for established wholesalers who have been in the market for some time and are known for their premium products. However, the surge in options for consumers has created a competitive landscape for manufacturers, retailers and wholesalers alike, having a knock-on effect on big names who may be unable to adapt quickly.
Businesses need to prepare and distribute orders quickly, more efficiently and at a lower cost to maximise the opportunities the current climate presents, or risk falling short.
Uncorking the warehouse challenge
The answer to this is flexible warehouse automation. After decades of growth in an industry fuelled by ‘Franken-systems’ – which combine mechanisation, pick-and-packing and intensive labour to move heavy, fragile and expensive cases – alcohol distributors have hit a wall. Traditional warehouse operating systems need an upgrade, and there is pressure from all sides, including from labour shortages and the disruption caused to fulfilment operations driven by increases in direct-to-customer deliveries.
While automation isn’t a new concept in the UK, traditional automation is sized on anticipated volume and type of orders based on a long period of time. Subsequently, traditional picking technology and equipment is no longer enough to support today’s alcohol warehouse environment. Instead, robotics has huge potential to support the complex demands of customers in 2024 and beyond.
Serving up a treat
In a warehouse environment dealing with home delivery fulfilment as well as store deliveries, flexibility and the ability to scale is vital, while ensuring that order cycle times are minimised. This is important as many retailers offer same- or next-day delivery on mixed cases of wine, beer and spirits. Robotics can be instrumental here.
Fragile and heavy bottles come in all shapes and sizes, needing careful handling and attention. Picking bottles and cans manually is difficult because of their weight, and pushing a trolley stacked with them is an arduous task. This can lead to health and safety challenges and exacerbate labour shortages in warehouses. Embracing robotics increases productivity by up to five times and improves staff satisfaction by eliminating these tasks.
For B2B wholesalers selling full cases of alcohol who need to shift towards direct-to-consumer sales, automation helps overcome the disruption caused in a warehouse where traditional picking methods are in use. This enables them to deliver mixed cases or individual items direct to the consumer.
Additionally, the same system can automate full case picking for stores, as well as mixed case picking for e-commerce, with the same levels of productivity. It’s this agility that sets smaller distributors apart from the incumbents.
Success on tap
Beer, wine and spirits distributors adopting robotic goods-to-person automation will continue to become more resilient against the challenges affecting the industry today. From reducing dependence on manual labour and boosting productivity to maximising space in the warehouse, these innovative systems position businesses to meet ever-changing market demands now and grow faster in the future.
