European eCommerce giant Otto Group says it is embracing an “AI-driven future.”
To that end, the company announced Tuesday (May 9) it has formed a partnership with Covariant, an artificial intelligence (AI) robotics company, using its robots to automate a range of fulfillment activities.
“Logistics faces the challenge of being as cost-efficient as possible,” Kay Schiebur, a member of Otto’s executive board, said in a news release.
“The use of a generalist AI allows us to rethink processes that were not possible before and provides an answer to the massive shortage of workers.”
According to the release, Otto Group will use Covariant robots to boost operational efficiency, build a safeguard against labor market challenges, and improve the overall quality of work within its fulfillment centers.
“The investment is expected to create new work profiles and attractive jobs while enhancing overall facility performance and ensuring more reliable delivery times — especially during periods of high or fluctuating demand,” the release said.
The aim of this partnership is to have hundreds of Covariant’s AI-powered robotic solutions in all of Otto Group fulfillment centers, starting this year in Germany.
The robots will let the eCommerce company “autonomously handle the dynamic and unexpected fulfillment scenarios that have previously limited picking automation,” the Otto Group said in the release.
In addition, Covariant’s robots learn together as a fleet regardless of where they’re located, which ensures that improvements propagate automatically companywide.
The partnership is happening at a time when many shipping and logistics businesses are seeking smarter ways to operate.
Zvi Schreiber, CEO of trade tech solution Freightos, said in a March PYMNTS interview that the international freight market’s status as a “largely offline endeavor” has resulted in “tens of billions of dollars of waste” and played a key role in recent supply chain troubles.
With these issues in mind, logistics firms are becoming more and more digital, with shipping companies putting aside Excel spreadsheets in favor of online platforms, and cargo companies employing application programming interface (API) integrations, spot rates and next-generation features like dynamic pricing.
“There’s legacy businesses, family businesses, old traditional companies that have now reached a point in the last two years where they understand that if they don’t take the next step, they will have troubles, they might even close, because they now need technology to provide the right level of service that their customers are looking for,” Raz Ronen, CEO at FreightTech startup Wisor.AI, said in a discussion with PYMNTS.
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