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The Role of Automation in E-Commerce

September 2022
Barbora Dostálová
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“Process automation.” This phrase is often heard in the modern world of business and technology. However, what is automation and how is it used in e-commerce? Let us find out! 

Companies are investing a great deal of money in artificial intelligence, machine learning, and robotics. This trend should not come as a surprise. Whether from a hardware or software perspective, robotization is already an integral part of our lives and workplaces. In fact, there has been an increase in the internal demand for automation in more than 90% of companies. The e-commerce industry is a leading example of how this demand impacts businesses. Most e-commerce sectors have been affected by this phenomenon, from textiles to furniture and even groceries.  

A fundamental change in consumer behavior is behind the push for further automation. Many people had to use e-commerce outlets rather than shop in physical stores during the two-year Covid-19 pandemic. This resulted in the creation of new e-commerce customers.  

In the wake of the pandemic, consumers seem to have realized that they prefer online shopping. Most of them who started doing so during the pandemic have continued to do so.  

The Companies That are Embracing Automation 

The Rohlik Group, a European leader in e-groceries, embraced the change in consumer behavior. By doing so, they turned it into an opportunity to profit. Rohlik invested forty-five million euros in its warehouses and fulfillment centers in Prague, Vienna, and Hamburg. This number includes the money that it spent on robotic carts. These carts can select customers’ items from the warehouse’s shelves without needing any external input. They will increase order preparation productivity threefold. Rohlik will also be saving 60 percent more storage space at its distribution centers due to the way the robo-carts move around.  

“Efficient and effective logistics, together with increasingly automated warehouses, are one of the keys to success,” says Erik Čomor, CEO of Knuspr.de – a German branch of Rohlik Group.  

Rohlik is not the only company that feels this way. Simona Kijonkova’s Packeta Group has warehouses that use automated carts called Packmans. A single Packman can sort 10,000 parcels per hour. Amazon has also bought into the automation hype. However, they have taken it one step further: they can now deliver goods to customers using drones. Nevertheless, not every business has the same point of view when it comes to implementing automation in practice. 

The Other Side of the Coin

Skladon, one of the largest Czech-based fulfillment providers for e-shops, has a different opinion. According to them, “fewer bots [equal] more options”. Konstantin Margaretis, co-founder of Skladon says, “In my opinion, automation is somewhat overrated from a short-term perspective.” He believes that every time a machine replaces a human, the company becomes less flexible.  

A business’s decision to automate processes depends on how it perceives its customers and how it intends to scale. Nonetheless, it is clear that automation is an emerging trend that will continue to grow and evolve. As an example, there are an increasing number of automatic stores that operate without salespeople. The first fully automatic store in the Czech Republic opened in mid-March of 2022. Due to its automation, it is open 24 hours a day. “We wanted to move our stores and cater to younger customers. I believe that the Czechs are already ready for this type of sale,” explains Jednota SD Volyně Board Chairman Roman Slamka.  

How does a self-service automated store work? It is easy! When a customer selects a self-service store in the company’s “app”, it generates a QR code. This code enables the customer to enter the store and purchase items from it. 

Conclusion 

There is a clear trend toward automation. It is observable in the logistics and retail sectors, as well as other traditional and emerging industries. Automation offers several benefits, such as reducing expenses and improving efficiency. On the other hand, not every business believes that scaling with automation is the right approach. Although automatic scaling can be great, it can also limit your ability to offer customized services to your customers and business partners. 

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