Robotics-as-a-service a growing market in logistics
Between 6% and 8% of total revenue in the mobile robotics for logistics market comes from robotics-as-a-service, according to research company IDTechEx.
X-as-a-service business models are now commonplace in various industries, involving the delivery of a specific service rather than a product to perform the service. The most significant change in models such as this is the replacement of a proportionally very large upfront product price with a billing structure that is based on the services performed as well as the product itself. This is particularly relevant in robotics; customers of robotics-as-a-service (RaaS) business models can get the benefits of robotic process automation by leasing robotic devices and accessing a cloud-based subscription service rather than purchasing the equipment outright. The headaches of ownership, such as paying off an expensive piece of equipment plus handling maintenance issues that spring up, are avoided with RaaS.
RaaS is becoming an increasingly popular option, especially for mobile robotics in logistics. In the research for IDTechEx’s newest report, Mobile Robotics in Logistics, Warehousing and Delivery 2022-2042, IDTechEx found that not only is 6–8% of the current market revenue for mobile robotics in logistics coming from the RaaS model, but some companies expect RaaS sales to grow in the future, as they had received increased requests for RaaS.
IDTechEx has revealed that intralogistics material transporting robots, like AGVs and AMRs, make up the largest share of the logistic mobile robotics market.
Low cost of entry
Even though the upfront cost of implementing mobile robots is usually much less than that of installing complex fixed automation systems, some small and medium-sized enterprises may not be able to afford to complete the system initialisation of mobile robotics at once. For instance, to fully automate the ‘goods-to-person’ process in a 5000 m2 warehouse, 200 grid-based automated guided carts (AGCs) could be needed, and the installation cost can be US$4–4.5 million if software and customised shelves are also counted in. However, like all X-as-a-service models, the billing of RaaS can be based on a monthly subscription or a pay-as-you-go model. In this case, companies can utilise the service without investing too much at the beginning and will have fewer losses if they stop operating the mobile robotic system.
In many industries, agile and lean operations are always desired; companies should be able to change operations or productions rapidly in response to market changes. RaaS allows users to start or end mobile robotic systems at any time point as needed, and also allows changing product types quickly, for example, transferring from ‘shelf-to-person’ grid-based AGCs to ‘carton-to-person’ case picking robots easily.
As described in the report, scalability is one of the most important strengths compared to fixed automation. RaaS enables easier scaling of the fleet size without concerns about the risks of reducing the fleet size in the future. For example, at sales peaks (eg, Black Friday and other shopping festivals) temporary workers are often needed in warehouses to fulfil the surging demand. However, due to the global labour shortage, recruitment for temporary positions has become very challenging. RaaS can address this issue cost-effectively by expanding the service size to increase capacity and productivity for only a short period of time.
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