Online Sellers Buying Robots

InVia Robotics has found ecommerce vendors are eager customers for its picker robots. The Westlake Village company makes the red-and-black machines that move through warehouses on their own and use suction cups to lift and deliver totes or boxes from shelves up to 8 feet high. They are assembled in Westlake Village and work in warehouses across the country. Chief Executive Lior Elazary said that inVia’s customers in the ecommerce industry are pressuring the company to make more robots available. “They are feeling the pinch and making us feel the pinch about how quickly we can deploy them,” Elazary said. InVia was started in 2015 by Elazary and co-founders Dan Parks, chief operations officer, and Randolph Voorhies, chief technology officer. The company has about 400 of its robots working in warehouses used by ecommerce companies. Just this year, Tobi, an online fashion retailer, and Rakuten Super Logistics, a third-party fulfillment center, announced they would begin using inVia picker robots. Michael Manzione, chief executive at Rakuten Super Logistics, a division of Japanese online retailer Rakuten Inc., said the inVia robots are a way to integrate automation into its eight warehouses and immediately see benefits of increased productivity. “Our expanded partnership with inVia is indicative of our company’s commitment to providing clients with state-of-the-art technology designed to maximize efficiency and minimize costs,” Manzione said in a statement. Rent a robot Elazary is a serial entrepreneur who started three other companies prior to inVia. Those three previous companies also dealt with automation but from the software side. What he learned from those experiences was the benefit of providing a service rather than just a product. The inVia business model is based on leasing the robots to its customers and then charging them per item picked and transported. “We own the maintenance, we own all the troubleshooting, all the issues that they might have – we take care of all that,” Elazary said. InVia also makes available its cloud-based robotics management system that handles the backend of the robots complete with the ability to monitor them from any mobile device. By selling the robots as a service inVia can make sure productivity goals are met between the client companies and their ultimate customers, Elazary said. “If the productivity is not being met, we as the robotics experts know how to get that as opposed to just selling the robots and if the productivity is not met then the customer does not buy the next one,” he explained. InVia currently assembles about 50 of its robots a month. Elazary expects to double that number within a year. About 70 percent of the parts used in making the devices are sourced from the U.S. with some specialty components, such as the motors, coming from China. In designing the robot, it was critical that it be done to keep the cost down. That means there are no precision parts and that vision cameras, sensors and artificial intelligence are used to compensate for the fact the robot is not precise and will wobble. “This allows us to bring the cost down to extremely low but still be able to do the same task that is required,” Elazary said. One area of the Westlake Village facility handles testing the robots. They scurry around on their own, picking totes off shelves, traveling with them around the test area and then return them to the shelf. Nearby, one robot raises and lowers its scissor lift 24 hours a day to test out which parts wear out first so that issues can be identified ahead of time. The robots run on batteries with a charge of about six hours that can be recharged or be swapped up with fully charged batteries. When the robots are first deployed in a warehouse, they scan all the items with fiducials, or visual markers that link with an internal database and an image of the item. After this mapping is complete, the robotic management system controls all the routes so that each robot knows what the other is doing. A self-learning algorithm helps detect what items are hot sellers and will have a robot move it closer to the picking station. Or if there is an area where the robots are always backed up, they can be instructed to move items to another part of the warehouse. “They are constantly optimizing the flow of products that is happening in the warehouse,” Elazary said. In designing the robot, one criterion that Elazary and his team started with was that they needed to be deployed into existing warehouses and make it a system that could be up and running fairly quickly. “That is what robots are really good at – adaptability,” he said. Corby Marshall, founder and chief executive of Hawkeye Systems, a Los Angeles company developing professional and military grade camera systems, said that while it is possible to adapt robots to older warehouses, it depends on the specific usage and there would have to be a cost-benefit analysis. “It is not a simple thing to do because you already have established work flow and to use robotics to update that would obviously have a cost associated with it in terms of software and hardware integration,” he added. Automation’s challenges Elazary estimated the cost savings to ecommerce retailers using inVia robots is between 50 percent to 60 percent. “Once they operate in more than one shift, they are able to save a lot more than that,” Elazary said. “They can use their existing labor resources to fulfill a lot more orders and grow their business.” There are, however, limits to what the robots can do. After all, despite what may be portrayed by Hollywood, robots aren’t all that smart, Marshall at Hawkeye Systems said. For example, a human can look outside his or her scope of work and notice there is a fire. Robots cannot do that unless it is specifically within their hardware and software, he said. “It is by definition very narrow in terms of the scope of what it can address,” Marshall added. Another pitfall is the perception of what robots cannot do, Elazary said. Some in management think that robots will solve all of their problems and so inVia staff must talk with those customers about what they are looking to achieve with the devices. Another challenge that inVia must address is getting companies to understand how the role of their human employees will change. They go from picking items in a warehouse to working as “robot wranglers” who solve problems for the robots that they cannot solve themselves. An example is when a box is too heavy and items need to be taken out before the robot can move it, Elazary said. But on the positive side, management at companies want to understand the benefits of automation. “We don’t have to spend too much of an effort to convince them because they know they need something else,” Elazary said. “They don’t know exactly what it is, but they know that what they are currently doing is not working for them.” High-tech competition According to U.S. Census Bureau statistics released in March, ecommerce sales topped more than $513 billion last year, an increase of 14 percent from 2017. Ecommerce accounted for nearly 10 percent of total retail sales in 2018. Given the growing market that inVia targets, it’s not surprising other players have emerged in the space. Two such competitors are RightHand Robotics Inc., in Somerville, Mass., and 6 River Systems Inc., in Waltham, Mass., both of which last year received funding from Silicon Valley private equity firm Menlo Ventures. Other collaborative robot companies include Locus Robotics, in Wilmington, Mass., Fetch Robotics Inc., in San Jose and Clearpath Robotics Inc. in Kitchener, Ontario. Last year, inVia received $20 million in a Series B round of financing, bringing its total outside investment to $29 million. The round was led by Point72 Ventures in Stamford, Conn., with contributions by Upfront Ventures and Embark Ventures, both in Santa Monica. InVia has 65 employees currently, some of them technicians based on the East Coast near where warehouses using the robots are clustered. Elazary would not disclose revenue, but said the money it makes is put back into operations. “We have the potential to be profitable at any time but were choosing to expand, deploying more robots and growing the business,” he said.