Editor’s note: Vertical Voices focuses on specific verticals within the supply chain, highlighting the latest trends and news. It appears on the fourth Monday of each month. This month, we are looking at warehousing. If you are interested in future topics, you can see a full list of upcoming topics on our Editorial Calendar.
Just a decade ago, only about 5% of warehouses had some form of automation. Today, nearly one-quarter do, and that number is only going to increase as legacy warehouses and industry sectors adopt more automation.
Andy Williams, vice president of North America for Exotec, tells Supply Chain Management Review that industries such as consumer product goods (CPG), industrial and automotive have been slower to adopt automation compared to other sectors such as e-commerce fulfillment. But, that is changing, and bodes well for the warehouse automation space in the years ahead as the industry rebounds from a slower 2024.
“Even in industries like CPG you are seeing some really significant changes,” he says. “They didn’t have e-commerce a few years ago and now it’s their fastest growing channel. With modern robotics technology, you are able to do things that weren’t possible before. You can use the same amount of workers to accomplish 400% improvement in throughout without expanding the facility.”
Williams noted that growth in the apparel and general merchandise verticals won’t see percentage growth in automation as fast since they are more automated sectors now. But, there is still significant interest in automation and robotics as 2025 dawns.
“We have customers talking about [loosening the purse strings] right now,” Williams said. “There are some verticals where that is going to be true.”
Solving complex problems
Williams says that automation and robotics solutions are enabling innovation in the warehouse space, but it is not a silver bullet.
“We have a mantra internally that solving complex problems in a very simple way is extremely difficult,” Williams says. “But that’s where you often find the greatest reward. One of the things we’ve relentlessly focused on is flexibility. In one system we can handle a very wide array of products … whether we need to build pallets by sequencing cartons or whether we need to pick nuts and bolts for an automotive supplier, we can use the same [system with some adaptations].”
Technology advancements
Williams says that robotic automate storage and retrieval systems (AS/RS) is the fastest growing technology at the moment, but a lot of investment is taking place in the humanoid space. While some are concerned about humanoid robots taking jobs, Williams says the technology “is in a little bit of hype cycle right now” and maybe five to 10 years away from becoming a significant factor in the space.
Artificial intelligence and large language models are also gaining traction quickly.
“They can help a lot, not only inside the warehouse, but also in supply chain planning in general,” he says. “The concept of real digital twins can be enhanced using a large language model. It’s providing capabilities to examine many different scenarios in a real way … that just wasn’t possible before.”
Ultimately, which technology a warehouse operator chooses comes down to one factor: speed.
“You have to be able to handle that wide variety, but you also have to be able to take in an order and get it completed in less than 30 minutes and get it ready to go. Standards have changed. Consumer expectations have changed. Business expectations have changed. … you have to have that ability to rapidly react,” he says.
Intense competition
Comparing the warehouse automation adoption trend in 2025 to an “arm’s race,” Williams says companies need to do their due diligence.
“There are a lot of market entrants that have come in and have shiny PowerPoint demonstrations,” he says. “At the end of the day, the proof is in the pudding. Do you have a number of satisfied customers I can talk to; what’s your experience with them; and have they delivered the results they promised? It’s hard to get to that point.”
Williams says having proof of a system that works and the ability to validate with data is crucial to implementing a successful automation solution. Talent can’t be overlooked, he adds, as well as having robust software to support robotics.
“The tier one customers invest—the Fortune 100—they invest a lot of money in engineering teams, automation teams, and a big part of their job is just educating [on automation],” he says, noting that automation is not just for large companies, but that it’s important to “identify the business case” rather than just adding automation. A consultant can help separate out what is real and achievable from what is shiny and a waste of resources.
Williams’ big advice is to ensure you are adopting a technology that will provide a benefit, and that the partner you choose is stable as mergers and failures have begun to ramp up in the space due to the number of automation suppliers. And if you are looking for the biggest bang for the buck, consider a complete supply chain transformation where you can get “the most effect” from automation technologies.
