The Friday Report Blog: September 2nd, 2022

Quick wrap up of a few hot topic newsworthy stories in the supply chain logistics industry

Geodis to Put 1,000 Autonomous Robots in Warehouses

In collaboration with Locus Robotics, Geodis plans to utilize 1,000 autonomous robots inside of their warehouses within two years. Geodis plan to boost robotics automation comes as e-commerce demand and labor constraints continue to increase.

The French third party logistics provider is currently using Locus’ Autonomous Mobile Robots in 14 of their storage facilities. These AMRs help to fulfill ecommerce orders in warehouses throughout the United States and Europe. Geodis began using Locus AMRs in their operations in 2018. The company states that the robots have drastically improved their throughput to accelerate delivery processes.

The agreement with Locus comes while Geodis continues to invest in its e-commerce business. They recently acquired omnichannel logistics company, Need It Now Delivers. In addition, they launched a direct-to-consumer fulfillment service from four of their ecommerce fulfillment sites.

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Retailers Set to Clear Inventory with Major Discounts

Rising inflation has affected businesses and consumers alike. The downturn in spending has driven retailers to markdown and discard unsold products, as clothing sales drop by more than half a percent each month.

The decrease in consumer spending began just as companies started to receive shipments that were delayed due to disruptions in the supply chain. In response, companies like Nordstrom and Urban Outfitters have started to employ tactics to clear their shelves and make room for holiday inventory. Product markdowns and order cancellations are only a few of the methods that they are utilizing. Nordstrom expects to lose $200 million in profits in the second half of 2022 due to clearance efforts.

The Gap and Kohl’s are using pack and hold strategies to sell products at later dates. This strategy is pricey for businesses however, as storage costs continue to soar. While Kohl’s is saving fleece garments for holiday sales, The Gap is storing basic clothing like t-shirt and shorts.

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Kraft Heinz Opens New Distribution Center

In June, Kraft Heinz opened a 650,000 square-foot distribution facility focused on improving processing speeds to get products to customers. The Lathrop, California facility is the culmination of a collaboration with Prologis and Ryder System. These companies assisted with construction. In addition, Kraft Heinz has tapped Ryder to manage warehouse operations. They plan to hire 100 new employees. The new distribution center is LEED-certified and utilizes solar power, LED lighting, and CO2 refrigeration to reduce Kraft Heinz carbon footprint. The building will serve as a model for future construction projects.

In their 2020 operational overhaul plan, Kraft Heinz outlined capabilities that they would incorporate into the construction of their new facility. The addition of rail capabilities for inbound and outbound shipments is one of their most significant add-ons. These rail docks will be serviced by Union Pacific. The company also plans to consolidate their other northern California distribution centers with their new facility.

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