Automated Fulfillment Centers Take Hold

Kroger to build a digitally enabled e-commerce center in Atlanta; Tel Aviv operation automates grocery order fulfillment.

July 16, 2019

ALEXANDRIA, Va.–Kroger is partnering with United Kingdom-based Ocado Solutions to build a largely automated, digitally enabled warehouse in metro Atlanta to help fill online orders, Global Atlanta reports. Separately, a prototype fulfillment center in Tel Aviv, Israel, includes robots that fill orders faster than human workers can, according to Digital Trends.

Kroger’s first customer fulfillment center broke ground in Cincinnati in June and plans were announced in March for another in Lake County, Florida. At least 20 new distribution hubs are planned to make way across the U.S. during the next three years. The 375,000-square-foot Atlanta facility is said to cost $55 million, will create 400 jobs, and will be ready by 2021.

The warehouses utilize Ocado’s expertise in supply chain software and automated warehouse solutions. The company will help Kroger fulfill and deliver online orders from Kroger customers. The partnership is in competition with Amazon and Whole Foods, but Kroger reported a 42% increase in online sales for its first fiscal quarter of 2019 and it is moving right along in its three-year strategic plan, “Restock Kroger.”

Meanwhile, in Tel Aviv, a facility developed by CommonSense Robotics, a Tel Aviv software development and installation service provider, is slated to provide one-hour grocery deliveries on behalf of a large grocery partner, as well as deliveries for other retailers who want to participate. Robots do the heavy lifting, but teams of employees pack the individual orders that are moved by robots to a dispatch area. The orders are then loaded on scooter or vans for delivery within Tel Aviv.

The fulfillment center is located in the underground parking area of one of the city’s most recognized skyscrapers, Shalom Meir Tower.

“Taking e-commerce fulfillment underground inside cities is one way we can enable retailers to fulfill online orders in close proximity to their customers—while doing it profitably,” said Elram Goren, CEO and co-founder of CommonSense Robotics.

The compact fulfillment center is just 18,000 square feet, compared with 120,000 square feet of a traditional fulfillment center, with an average clearance height of only 11 feet. The facility has three temperature zones: ambient temperature, chilled and frozen.