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Last Mile of the Race: Micro-Fulfillment Centers Bring the Supply Chain to the Consumer


Til Engelland
December 14, 2020
Retail & E-Commerce
Reading time: 3 minutes
Over the last few years, as e-commerce sales have increased and customer expectations have shifted, there has been a steady race to move fulfillment closer to the customer.
AutoStore Micro-fulfillment
Something once so innovative as two-day delivery has led to next-day delivery, which is quickly becoming obsolete as consumers demand same-day delivery. 
 
This trend has accelerated during the COVID-19 pandemic, especially as more consumers become comfortable with online ordering of perishable items and groceries. One of the significant changes in supply chain strategies we are seeing as a result of this is the rise of fulfillment centers that bring fulfillment closer to the consumer. 

 

Typically, one of the dominant components in a company’s supply chain was the large warehouse or distribution center that acted as a central hub from where products are shipped to retail outlets. These are now being joined by a network of fulfillment centers that focus on localized, direct-to-customer service. They are designed to primarily get online orders to the customer quickly. These facilities have become a powerful tool in conquering the last mile and helping maintain a pleasant, seamless customer experience. 

 
One relatively new type of fulfillment center that is gaining a lot attention is the micro-fulfillment center. Micro-fulfillment centers are a simple and compact last-mile delivery solution that can be quickly deployed anywhere, especially where real estate space is limited or cost-prohibitive. While they are generally smaller in size than regional or metro-fulfillment centers, they can be virtually any size, providing the needed flexibility to meet customer needs and fit nicely into a wide range of supply chain strategies. 
AutoStore Micro-fulfillment
Micro-fulfillment featuring AutoStore
Micro-fulfillment centers can be built as a standalone facility, or built inside or bolted onto an existing location to expand fulfillment capacity, especially within limited footprint. They are also well suited for automation technology, bringing it to the lowest supply chain level.  

 

While they can be used in a number of market segments and industries, micro-fulfillment centers have gained the spotlight as a result of the accelerated demand in e-grocery fulfillment. Micro-fulfillment has shown to be an ideal solution for streamlining e-grocery fulfillment. 
 
For instance, Swisslog is working with H-E-B to deploy multiple automated micro-fulfillment centers to support the supermarket chain’s curbside grocery pick-up at more than 40 stores in the San Antonio area. The new micro-fulfillment centers feature AutoStore empowered by Swisslog’s SynQ software, pick stations and integration. 
 
Micro-fulfillment centers are quickly becoming an essential part of the supply chain. They hold much promise for helping reduce delivery costs and shorten the last mile and the time to consumer. They are also an ideal solution for fulfilling online orders for curbside pickup. With the right approach and automation technology, they can help you meet changing expectations and enhance customer experience. 

 

Swisslog has a comprehensive portfolio of solutions to meet the needs of retail, e-commerce and e-grocery customers. From large distribution centers to smaller fulfillment centers, there is a wide range of technologies available to address the today’s challenges and demands. 

So, how might automated micro-fulfillment centers fit within your supply chain strategy? Visit the micro-fulfillment center page on Swisslog’s website. 

 

 
About the author
Til Engelland

Portfolio Manager at Swisslog


More about Til Engelland
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