> Fenyo added that Kroger’s decision to locate the Ocado centers outside of cities turned out to be a key flaw.
> “Ultimately those were hard places to make this model work,” said Fenyo. “You didn’t have enough people ordering, and you had a fair amount of distance to drive to get the orders to them. And so ultimately, these large centers were just not processing enough orders to pay for all that technology investment you had to make.”
There's probably still room for automation, but it might have to be different than warehouse automation.
If a basket of groceries brought online costs $15 more than the in-store prices, then you can pick in-store profitably, very easy. That's the instacart model.
But if a basket of groceries brought online costs about the same as buying in-store? With the retailer bearing the costs of picking, packing and delivery instead of the customer?
Well then you need something more efficient than a store.
I've also noticed this with hardware stores like Lowes. If I place a pickup order they more often than not will pawn off on me their broken, returned, or even used and damaged stock. Items like building wrap will have soil and rips on it, concrete mix will be spoiled from moisture, lumber will be all the most warped pieces (if you don't order a whole pallet, expect every last piece of fractional pallet will be knotted to hell, split, twisted, and badly warped), plumbing valves will be open package and leaky, etc etc. It's like clockwork, even if the stock sitting on the shelf doesn't have these problems. Due to this there are some stores I will never do a pickup/delivery order from.
Agree a lot of modern delivery businesses involve "self-employed" drivers getting paid a pittance and using their own vehicle and fuel, though.
In the AI analogy, never underestimate the productivity of a human when dealing with a giant pile of groceries. You can throw all the AI and robots you can at something but sometimes a $20 an hour human picking from stacks of goods and produce simply destroys it in raw economics
There may also be an issue with logistics when it comes to making sure the machines keep running if there is a problem. They can barely keep the ice cream machines running.
Maybe they're just following the trends their own numbers tell them are happening, but I don't think they trust robotics enough to put an area they truly care about under its purview just yet.
But I’ve read they’re effective, apparently, in consistently upselling compared to a human, so I’m guessing that’s their play.
Any reason to like the old way is just nostalgia in my head.
Guess I was right.
I associate it more with delivery vans that seem to be in no particular hurry (unlike uber eats / DPD / UPS etc)
It is possible, but you end up spending 10x as much on the building.
Lots of big cities have grocery stores with parking garages under them, doesn’t seem much different.
Also, the backstock is minimal. Stores are designed for turnaround.
The answer is $. It costs too much and land is cheaper than building up (In most places).
I don't know what success looks like but it's probably fair to say they were over-extended by roughly 30-40%.
https://chainstoreage.com/kroger-pay-350-million-automation-...
I'm also skeptical it'll ever work in America due to the general lack of density.
Basically, each section is like a closed areas with some windows. Customers order at the computers by the windows and flash their membership cards. Robots glide left and right to move 10 samples to the customer, in an arm with rotating clips. Customers can press a button to rotate the samples, observe them, and place an order by pressing a button. Samples not chosen are temporarily stocked at the window as a “stack”.
In each closed section, there are humans who monitors and maintains the robots, and occasionally fetch samples when robots stop working (hopefully it too often, you know those 9s).
At the exit, a human worker assembles the packages and hand them to the customers with a smile. Customers have a last chance to return unwanted items.
Why was it a retro futuristic dream? Because the customers have the option to go into a bakery to enjoy a cup of coffee/tea, some cake and socialize with fellow customers. All of them looked like the men and women from advertisement from Fallout 4.
I’d like to shop or even help build one of these.
TBH, now that I think about it, the dream was way more vague than what I described in the reply. My brain probably reasoned about the idea subconsciously.
The only exception in warehouse was the cafeteria. I guess my brain wanted to make something retro futuristic so it made the cafeteria “retro” — manned by humans and cooked by humans too. There were even balloons inside now that I recall…
Basically a catalogue store without shipping to your door.
IKEA is kind of like that also, but you have to get everything yourself after picking it out upstairs. And Sears might have been like this at some point before I was born.
>In the 1990s, Consumers Distributing struggled to compete with Zellers and then Walmart Canada. Consumers Distributing sought bankruptcy protection in 1996.
And Zellers went under just a few years ago...
I do research price, though, so if they show a big DISCOUNT sign and is more or less honest with it, I'll probably grab some, too.
Then in the 90s they were all washed away by the new ones.
[1] https://rarehistoricalphotos.com/keedoozle-automated-store-p...
Here is the story
https://www.facebook.com/100064532630592/posts/pfbid0DYoPXet...
Looking at the details, I could say Kroger shouldn't have hired her but I'd rather say that if she was dangerous enough to not hire as a driver then her license shouldn't have been reinstated in the first place. (Though that's if "couldn’t recall if her driver’s license was suspended just months before he hired her" means it actually was suspended, and Bike Law isn't doing some trickery with wording.)
Either way good they paid out.
For the shutdown, I do think it's a coincidence. They're shutting down facilities in multiple states and that lawsuit isn't even a tenth of a percent of the relevant costs.
> Fenyo added that Kroger’s decision to locate the Ocado centers outside of cities turned out to be a key flaw.
They over-spent on automating low-volume FCs. You could draw comparisons to Amdahl's law, they optimised the bit that wasn't the issue, the real issue was delivery distances and times.
Ocado has had good success with the robotics approach in the UK, because the UK is very high density compared to a lot of the US. Plus Ocado put a lot of work into creating good delivery routes, whereas it sounds like that wasn't a component of the automation stack that Kroger bought.
Robotics for picking and the general feasibility of grocery delivery in the US.
Ocado is good because their stock levels are far more accurate than the other supermarkets for online ordering, so you don't get as many substituted/missing items. This is sort of a side effect of having dedicated picking facilities Vs "real" supermarkets. I would not be surprised if they "lose" less stock as well compared to in supermarket fulfillment.
Then you have "is online grocery good in the US"? There's a lot of areas of the US that have reasonable density for this kind of service imo, and the road infrastructure is generally far superior to the UK which negates any loss of density (as you care about time between deliveries, not distance per se). I imagine the much better parking options in most suburbs in the US also helps efficiency (it's an absolute nightmare for a lot of the online delivery cos when there isn't off street parking in the UK and they have to park pretty far from the drop).
It sounds to me that Kroger just messed up the execution of this in terms of "marketing" more than anything.
According to the article, there were several strategic blunders, including trying the model outside of cities where lack of density cut against it. Plus the apparent dismissal any value their 2700 retail locations could provide.
As far as I can tell, Kroger didn’t acknowledge anything except a change in strategy.
Unsure how the headlines doesn't align. Maybe it's different than what I'm seeing:
> Kroger acknowledges that its bet on robotics went too far
This I guess is Robo Kroger.
A weird, dark, maze-like warehouse-feeling Kroger that just closed.
We have a really nice Kroger a bit outside town. I always think of it as the Gucci Kroger.
A college-kid, cheaper Kroger close to the center of town. The cheaper version of the Harris Teeter nearby.
There's as much variation in individual Krogers as between other grocery chains!
AndrewKemendo•3h ago
That makes sense to me.
Feels like we’re going to have warehouse scale vending machines in cities, and delivery bots taking them from the warehouse-vending-machine to the customer.
recursive•3h ago
aerostable_slug•3h ago
Because tips are important to the income of delivery shoppers, I find that I generally get good produce selections. It might be difficult to transition that particular incentive to robots, but the point is that delivery items don't have to suck.
The only thing I really still pick out by hand every time are beef briskets. Pork shoulders tend to be uniform enough that randomly picking a cryovac works out, but there's a good bit of variation in brisket that makes a difference with the final product, at least when the brisket is prepared with a smoker. YMMV
recursive•2h ago
mlrtime•26m ago
Wait, you tip to get a good selection of produce to be delivered to you? This is very bizarre to me.
AlotOfReading•3h ago
acessoproibido•3h ago