Posted July 2020Back to Resources
Pitney Bowes, a large third-party logistics (3PL) provider, routinely faced challenges in sourcing adequate manual labor for its e-commerce operations. Predicting how many workers were needed, how many would actually show up, as well as the cost of training, weighed on Pitney Bowes’ plant managers, even when using temp agencies. Fierce competition from other warehouses in the local area kept driving labor wages higher. This uncertainty was not sustainable, especially in a time of increased competition in the 3PL industry and rising expectations from end-customers.
As a result, when a new e-commerce client hired Pitney Bowes to run its subscription box kitting, Stephanie Cannon, the Vice-President of Continuous Improvement and Operations Innovation, looked for the right automation partner. This partner had to be in a position to reduce cost per kit, and to handle the technical requirements of kitting and palletizing operations. In addition, having seen numerous automation efforts fall short of expectations in the past, Stephanie was hesitant to commit a large capital expenditure (CapEx) on robotics.
Enter Vicarious. Vicarious designed a new workflow tailored to the specific needs of Pitney Bowes and deployed “intelligent” robotic lines in their facility. Powered by proprietary machine vision and AI algorithms, these lines were able to handle levels of complexity and versatility beyond reach of “traditional” hard-coded automation: grabbing from unstructured bins, inserting into moving boxes, manipulating ~15 new SKUs and ~200 different kit configurations every month. Kitting tasks were fully automated (palletization is now being tackled) and cost per units reduced by ~35% in a few months. Vicarious deployed technical advisors on-site to ensure smooth implementation and continuously optimize systems.
In addition, Pitney Bowes was able to deploy this automation with no upfront CapEx, thanks to Vicarious’ Robot-as-a-Service (RaaS) model: a simple pay-per-piece model indexed on actual production and covering all services (development, installation, maintenance, ongoing support), ensuring predictable operating costs.
As Vicarious’ technology capabilities are regularly improving, the two companies now collaborate on new automated lines, with updated designs ensuring faster throughput, increased automation, and further reduction in cost per unit. Additional human-machine interface (HMI) features are also being added, to facilitate tracking (and thus predictability) of operations and enable a level of customization currently out of reach of manual operations. As Gregg Zegras, EVP and President of Global Ecommerce at Pitney Bowes says:
“It is remarkable to watch a robotic arm actually improve its performance through practice. Vicarious is helping us automate processes we were unable to automate in the past.”
Moving forwards, our ambition is to collaborate on harder and harder operational challenges, continuing to increase Pitney Bowes’ competitive edge through technology along the way.