Hey, you know what! Amazon is building its first Robotic Fulfilment Centre in Sydney

Summary

• Robots engaged within Amazon’s fulfilment centre are optimising the supply chain, enhancing the customer experience, as well as benefiting humans working alongside them.
• Recently, Amazon unveiled its plans to launch its first robotics fulfilment centre in Sydney to speed up deliveries and double its capacity, primarily due to accelerated shift towards online shopping.
• The fifth Amazon fulfilment centre (Sydney) would span across 2 million square metres, further creating over 1,500 warehouse jobs across robotics, IT and HR, along with another 700-job creation during construction.

What started as an online book retailer in 1995 has become a global giant or, we should say an everything store, with membership subscriptions, cloud computing services, sale of groceries, physical stores, its range of smart devices and a delivery system, which can provide goods to consumers in a couple of hours.

You must have heard of e-commerce giant’s prime services. In a fast-paced life of present times, many of us embrace these services on a daily basis to promptly receive our order within a few hours or in a day.

In a given scenario, when one is running low on any stuff; the person might count on Amazon’s prime services to replenish their stock. And when the order finally arrives at one’s doorstep, one must thank both robots and humans for the quick delivery.

Are you wondering how robots came into the picture? Well, robots are transforming Amazon’s fulfilment centres (FC).

Amazon’s FC across various nations have humans and robots working in harmony to deliver packages to customers on time.

These centres work on the philosophy of humans + robots and not humans vs robots.

The robotic arms and small drive units deployed at centres, are designed to help human workers, operate faster shipping, maximise inventory, and minimise cost.

This robotic automation has taken over the responsibility of transporting pallets of inventory through buildings, picking up heavy items to prepare them for shipping or for stowing, which in turn, helps warehouse workers to take care of other tasks apart from these.

A significant challenge to automation is the last-mile delivery that still needs human power. Further, Amazon.com, Inc. (NASDAQ:AMZN) has strategically chosen to automate in areas where it can reap the benefits immediately.

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Let’s quickly have a look at few facts related to Amazon Robotics:

• Since the introduction of robots after the acquisition of Kiva Systems in 2012, Amazon has added ~300 thousand full-time jobs internationally, while, denying the belief that robots are replacing human workforce.
• Amazon has over 175 FC and 40 sort centres around the world.
• The e-commerce giant has opened over 50 Robotic FCs across the globe.
• Currently, more than 200 thousand robotic drive units are supporting Amazon around the world.

It might come to you as a pleasant surprise that Amazon (AU) had unveiled its plans to launch its first Robotic fulfilment centre in Sydney.

Yes, you heard it right!

On 30 June 2020, Amazon Australia declared its plans to set off its first Amazon Robotics fulfilment centre at Goodman’s Oakdale West Industrial Estate in Western Sydney.

This strategic move of building a giant robotic fulfilment centre in Sydney would give the Company a stronger foothold in the Australian retail market.

CBRE’s Industrial & Logistics business has assisted the lease of this centre, while the building is anticipated to conclude by the end of 2021.

Further, on 30 June, Amazon gave a lease pre-commitment deal for 2 decades to JV Trust of Brickworks Limited (ASX:BKW) and Goodman Group (ASX:GMG) for state of the art distribution facility and Goodman has been noted to manage the construction of the facility.

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The new FC would be deployed with the advanced Amazon Robotics technology to assist workforce, further, contributing to the efforts of e-commerce giant to deliver a faster, smarter, and more consistent experience for its customers across the Australian market.

Robots would help to pace up order processing time by shifting shelves to personnel, thus, decreasing the efforts and time consumption to store objects for sale or pick them up for new orders, creating a more pleasant work environment.

The new storage and distribution centre would occupy a floor area of over 200 thousand square metres, equivalent to the footprint size of 22 rugby fields or Taronga Zoo.

Interestingly, it would use 3,000 tonnes more steel than used for Sydney’s ANZ Stadium.

This new automated expansion plan of FC would equip Amazon to store 50 per cent more items per square metre while, housing up to 11 million items.

This FC is close to transport links, large consumer population, and the future Western Sydney International airport, making it reachable for faster incoming and outgoing deliveries.

Additionally, it would enable 10,000 small and medium-sized businesses who sell on Amazon’s marketplace and use its fulfilment services to serve its customers in the domestic market smoothly.

Mr Craig Fuller, Director of Operations, Amazon Australia said the FC would create over 1500 permanent full-time jobs (majorly), who would be working alongside robots to deliver the ultimate in service for customers.

The skilled employment opportunities would be offered in the areas such as robot mechanics, electrical and software engineers, logistics and supply chain roles, and job opportunities in the industry-leading workplace would range from IT, HR, robotics professionals.

Additionally, another 700 jobs would be created during construction.

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The fifth fulfilment centre of Amazon Australia would complement the existing three manual fulfilment centres, launched in:

• Dandenong South, Melbourne in December 2017 with a footprint of 24,000 square metres.
• Moorebank, Sydney in August 2018 with a land size of 43,000 square metres.
• Perth’s Airport Precinct in November 2019.

On 11 June, Amazon announced its plan to develop a fourth fulfilment centre in Lytton, Brisbane, which would commence its operations before Christmas 2020.

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During COVID-19 pandemic, retailers had witnessed soaring sales in the online marketplace as housebound shoppers opted to shop online.

Moreover, this expansion plan with an automated warehouse is buoyed by an accelerated shift to online marketplace from bricks-and-mortar retail stores.

Stock performance

As on 1 July 2020, Amazon’s share price witnessed an upsurge of 4.35% and stood at USD 2,878.70.