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Swisslog delivers its latest robot-based warehouse system in retail and e-commerce for Axiom Telecom

Swisslog delivers its latest robot-based warehouse system in retail and e-commerce for Axiom Telecom



Automated market is booming in Mideast

Coupled with industry growth and shifting workforce demographics, the automated material handling market is being driven by improved wireless technology

November 2019

The Middle East automated materials handling equipment segment is growing rapidly at a CAGR of 8.6 per cent and is expected to reach $498.5 million by 2023, across the full spectrum of industries.

For reasons ranging from cost-control to health and safety, automated materials handling is a fast-growing sector in logistics as companies across the supply chain seek to minimise operational and manufacturing costs by reducing human involvement.

According to a new growth forecast report by Global Market Insights, the global materials handling equipment market is growing at 5.5 per cent CAGR and is expected to surpass $190 billion by 2024.

The global automated material handling equipment market is expected to reach $44.6 billion by 2022, an annual growth of almost 8 per cent (research by Markets & Markets). This makes automated material handling one of the fastest growing sectors within logistics.

 

PRESSURE GROWS

In the Middle East, the automated materials handling equipment segment is projected to reach $498.5 million by 2023.

Saudi Arabia and the UAE account for the largest regional shares of the market, with both nations making massive investments in infrastructure to position themselves as ideal destinations for logistics and warehousing operations.

A recent boom in e-commerce is also a major driver for automated materials handling as industry players aim to improve quality of service, with the UAE positioned as the regional leader in e-com logistics, while Saudi Arabia is the largest e-commerce market.

The Middle East is gearing up to take advantage of digitisation in a big way

The Middle East is gearing up to take advantage of digitisation in a big way

When it comes to various sectors, retail and e-commerce markets are growing rapidly. Some of the requirements of this sector include same day delivery, efficiency in fulfillment centres and better space utilisation in warehouses, all of which can be enabled by automated materials handling.

According to a report by Fitch Solutions, by 2020, the UAE e-Commerce sector will be worth $17.8 billion, or 45.6 per cent of the total value of the Middle East market. There will be an uplift from 2018-19, the major reason being Expo 2020 which is expected to attract plenty of foreign businesses and workers as well as tourists who will then make purchases primarily online. The region’s youthful demographics, with their high levels of disposable income and high internet and mobile penetration rates, are one of the prime factors for this growth. Similarly, by 2020, the GCC F&B market size is expected to expand at a CAGR of 9.2 per cent to reach $34 billion.

Here are some key factors driving automated materials handling growth in the GCC region and beyond:

 

REDUCED COSTS

Automation is poised to make a significant and lasting impact on profitability, particularly as it reduces the need for manpower and outsourcing.

Once considered the most effective way to manage costs while still producing a high-level output, outsourcing has been rendered obsolete by AI-powered automation which reduces errors, enhances security and allows for better scalability.

Automated materials handling can reduce walk time within a warehouse, as well as produce higher picking accuracy levels. As much as 70 per cent of the picker’s time may be in travel time, something which can be easily countered with automated materials handling.

 

SAFETY

As businesses pursue automated industrial operations, increased safety is a tangible value-add. Improving workplace safety conditions is one of the primary motivators for manufacturers replacing existing materials handling solutions with automated systems.

These systems reduce the risk of injury by removing workers from dangerous work procedures. Automated systems also make it seamless for businesses to update safety protocols and create a plan of action – without disrupting normal operations - in case of an emergency.

Automated materials handling results in fewer workplace accidents by eliminating the need for heavy lifting, reducing the chances of workers tripping or falling, and making workstations ergonomic to prevent injury.

Automated systems also typically respond faster to emergencies by providing real-time monitoring. Safety results in happier workers, reduced costs and increased efficiency, all key metrics in bottom-line performance.

 

ADVANCED TECHNOLOGIES

Coupled with industry growth and shifting workforce demographics, the automated material handling market is being driven by improved wireless technology.

The Middle East is gearing up to take advantage of digitisation in a big way, and companies in the region are making real investments for real results today. A report by PwC Middle East says that 41 per cent of participants surveyed from the region say they have already reached an advanced level of digitisation and integration and over 62 per cent expect to be at such a level in five years’ time. Compared to other countries around the world, that is an unusually high level of digitisation.

Several businesses have benefitted immensely from an automated materials handling solution. Some examples (globally) – I.M.A. SpA, a leading Italian company in the design and production of automated machines reduced their space requirements by 80 per cent with the use of AutoStore, Hamburg-based lifestyle company HAGEL GmbH attained delivery times  of less than 24 hours with the use of CarryPick and Pepsi Bottling Ventures, the largest privately-held manufacturer, seller, and distributor of Pepsi-Cola beverages in the US deployed PowerStore to increase storage capacity by over 60 per cent in its existing flat-ceiling building.

In the UAE such companies as Mai Dubai, Almarai are among first adopters of logistics automation solutions. Automation has more than doubled the current production capacity of Mai Dubai and the fast-growing retail and e-commerce company, Xenos, improved its pick performance by more than 50 per cent and saved 3-4 hours shipment time per delivery per store. Not surprisingly, automation is central to several GCC countries’ future development plans and the region’s logistics market is set to grow at a rate of 7.3 per cent CAGR to a value of $66.3 billion by 2020.

Indeed, robotics and automation have paved the way for more efficient, productive and intelligent industrial operations over the years.

Robotic Process Automation is, however, only the beginning. With the increasing sophistication of IoT technology, new solutions will add further value for manufacturers in years to come.

As more and more businesses see the results of machine-driven solutions, next-generation robotic technologies will further amplify smart, smooth and cost-efficient materials handling operations.




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