Amazon Buys Futuristic Warehouse Robot Company
Amazon has announced that by the end of the second quarter of 2012, it will be the proud new owner and operator of Kiva Systems, a company that makes bright orange robots designed to fill warehouse orders.
The $775 million cash purchase is part of Amazon’s growth plan for the year, which also includes the addition of 17 new warehouses, for a company total of 69.
“Kiva’s technology is another way to improve productivity by bringing the products directly to employees to pick, pack and stow,” said Amazon Vice President of Global Customer Fulfillment Dave Clark. “Kiva shares our passion for invention, and we look forward to supporting their continued growth.”
Kiva’s robots enhance automation by moving through warehouses, picking up and moving shelves and boxes of products. They’re the creation of former Webvan.com employee Mick Mountz, who realized that the online grocer was spending too much money to fill online orders.
“[An] 89-cent can of soup was costing us $1 to get it into the tote,” Mountz told CNN. So he battled against investor doubts to build Kiva Systems into a thriving business, even though in its early days in 2002, he “heard ‘No’ 50 to 100 times.”
Since then, Kiva has picked up a variety of customers, including Amazon and its fellow retailers Staples, Walgreens and The Gap. A Kiva “startup kit” of robots costs about $1 million to $2 million while a large warehouse operation needing up to 1,000 robots will spend $15 to $20 million.
Analysts report that Kiva has been growing at an annual rate of 80 percent, with sales reaching nearly $150 million last year.
Although Kiva has proven to be a successful company, Amazon’s full-on purchase of the manufacturer is a bit mysterious. Kiva’s products are peripheral to Amazon’s existing business, and for $775 million, Amazon could have just bought a bunch of Kiva’s robots without having to bother with running the whole company.
Amazon has said that it will continue to sell Kiva robots to other companies and the retailer will likely also look into ways to tweak and tailor Kiva’s systems from the inside, giving it an advantage over its competition.
Considering Amazon’s track record with warehouse employee complaints, a shift to more mechanical labor seems like a smart move. Last year, Amazon took heat for turning up the heat on warehouse workers, as several reports surfaced stating that conditions in the company’s US-based fulfillment centers were brutal, particularly during summer heat waves. The Morning Call reported that “temperatures soar on hot summer days, production rates are difficult to achieve and the permanent jobs sought by many temporary workers hired by an outside agency are tough to get.”
Intelliwave SiteSense boosts APTIM material tracking
“We’ve been engaged with the APTIM team since early 2019 providing SiteSense, our mobile construction SaaS solution, for their maintenance and construction projects, allowing them to track materials and equipment, and manage inventory.
We have been working with the APTIM team to standardize material tracking processes and procedures, ultimately with the goal of reducing the amount of time spent looking for materials. Industry studies show that better management of materials can lead to a 16% increase in craft labour productivity.
Everyone knows construction is one of the oldest industries but it’s one of the least tech driven comparatively. About 95% of Engineering and Construction data captured goes unused, 13% of working hours are spent looking for data and around 30% of companies have applications that don’t integrate.
With APTIM, we’re looking at early risk detection, through predictive analysis and forecasting of material constraints, integrating with the ecosystem of software platforms and reporting on real-time data with a ‘field-first’ focus – through initiatives like the Digital Foreman. The APTIM team has seen great wins in the field, utilising bar-code technology, to check in thousands of material items quickly compared to manual methods.
There are three key areas when it comes to successful Materials Management in the software sector – culture, technology, and vendor engagement.
Given the state of world affairs, access to data needs to be off site via the cloud to support remote working conditions, providing a ‘single source of truth’ accessed by many parties; the tech sector is always growing, so companies need faster and more reliable access to this cloud data; digital supply chain initiatives engage vendors a lot earlier in the process to drive collaboration and to engage with their clients, which gives more assurance as there is more emphasis on automating data capture.
It’s been a challenging period with the pandemic, particularly for the supply chain. Look what happened in the Suez Canal – things can suddenly impact material costs and availability, and you really have to be more efficient to survive and succeed. Virtual system access can solve some issues and you need to look at data access in a wider net.
Solving problems comes down to better visibility, and proactively solving issues with vendors and enabling construction teams to execute their work. The biggest cause of delays is not being able to provide teams with what they need.
On average 2% of materials are lost or re-ordered, which only factors in the material cost, what is not captured is the duplicated effort of procurement, vendor and shipping costs, all of which have an environmental impact.
As things start to stabilise, APTIM continues to utilize SiteSense to boost efficiencies and solve productivity issues proactively. Integrating with 3D/4D modelling is just the precipice of what we can do. Access to data can help you firm up bids to win work, to make better cost estimates, and AI and ML are the next phase, providing an eco-system of tools.
A key focus for Intelliwave and APTIM is to increase the availability of data, whether it’s creating a data warehouse for visualisations or increasing integrations to provide additional value. We want to move to a more of an enterprise usage phase – up to now it’s been project based – so more people can access data in real time.