Global e-commerce sales are expected to top $6.3T in 2023, which would represent double-digit year-over-year expansion within the category. The scale of the ecosystem is reaching a staggering level, and there has been no shortage of associated growing pains on its embedded infrastructure. There is perhaps no place where this strain has been more acute than in high-volume fulfillment, distribution, and sortation centers. The effects of COVID-19 aside, there has long been a disconnect between the secular growth of online retail and the connective tissue that keeps it all together. Simply put, most warehouses and third party logistics providers (“3PLs”) responsible for receiving, shipping, and sorting items that customers order online are still many years behind the level of automation required to keep up with the unforgiving demand. To make matters worse, labor shortages for warehouse staff have never been more extreme. In recent years, the warehousing industry has carried one of the highest instances of occupational injuries and yet also ranks among one of the lowest in terms of its average hourly wage (adding insult to injury, quite literally). It should come as no surprise, therefore, that warehouse operators continue to cite hiring and attrition as a top challenge facing their business. Amazon, as an example, was recently reported to have turnover of 3% of its warehouse staff every week (150% attrition on an annualized basis!) – and this was before the pandemic started. Needless to say, global logistics providers are struggling to keep pace.
For these reasons, among many others, we are thrilled to announce that we are leading an investment in Plus One Robotics as part of the Company’s $50M Series C financing. Plus One Robotics is a San Antonio-based developer of robotic systems that help optimize conveyor induction and depalletization for some of the world’s largest logistics providers. At its core, the company specializes in streamlining the movement of mixed parcels, bags, and products for logistics providers in the likes of DHL, FedEx, and MSC Industrial, many of which Plus One counts amongst its growing rolodex of customers.
Plus One Robotics is taking direct aim at optimizing conveyor induction and depalletization for some of the country’s largest logistics providers. This may sound like a small problem, but in the US alone there are nearly 2M warehouse associates, approximately 20% of whom work specifically on conveyor induction, depalletization, and related tasks. To put the size of this problem into perspective, if the labor force involved in these first two tasks alone were gathered together in one place, the resulting population would come close to that of a top 50 US city – and that’s just in the US
The team at Plus One has taken a unique approach to solving this immensely challenging technical problem. The company’s software and machine vision stack needs to be capable of recognizing, sorting, and classifying new package types that are constantly changing shape and orientation – and its capabilities in doing so need to be on par with, or better than, those of a human. Customers are laser-focused on ROI that increases warehouse throughput (often measured in picks per hour or “PPH”) while minimizing downtime, knowing that every misstep flows directly to their already thin bottom lines.
In an industry that is in many ways defined by exception handling, Plus One leverages a human-in-the-loop system called “Yonder” to remotely intervene when something goes wrong. For the customer, this means a Plus One system will always get the job done and, for Plus One, it means continually refreshing its data assets. In a world where it is still hard for machines to reliably outperform humans in completing complex tasks – as we have seen from our work with Locus Robotics (also within e-commerce and logistics), Soft Robotics (within food and beverage), Dusty Robotics (within commercial construction), and Drone Deploy (within agriculture, utilities, and real estate) – we believe that collaboration between humans and machines is still the optimal route to getting things done efficiently and cost effectively.
The team at Plus One brings together several decades of experience within the logistics industry and in building software that has enabled the sector’s ongoing advancement. To this end, we can’t wait to embark on a journey with CEO, Erik Nieves, and the rest of the Plus One team to meaningfully reduce the time and cost associated with commercial conveyor induction and depalletization tasks as well as the huge swath of opportunities on the horizon. Welcome to the Scale family!
