Robots have triumphed ProMat. The supply chain and logistics show is sort of a perfect microcosm of where the industry is headed. Many of the show’s main attractions have moved from the center stage to the physical margins of the show floor, while competitors such as 6 River Systems and Locus take the spotlight – my interviews with both took place in conference rooms on the second floor of their huge stands.
Among other things, this proved to be an ideal setting to speak with founders and executives of some of the biggest players in the space. Jerome Dubois ticks both boxes as co-founder of 6 River Systems, and he’s now VP of Shopify Logistics, following the e-commerce giant’s acquisition of the robotics company in 2019.
We talked about Amazon’s role in the company’s founding and what the future holds for robot picking and interoperability.
TC: What is the 6 River story?
JD: I’ve been in the industry for 25 years. Started on the software side, so warehouse management systems — [at] a company called Yantra, which is now part of IBM. I joined Kiva in 2008; was there through the takeover. I was [Locus CEO Rick Faulk’s] pastor and Bruce Welty was my client. I’m the one who told Bruce that “we’re shutting down your systems.”
Small worlds in small worlds.
Yes. But we have a lot of respect for that team. We are the two leaders in this space, between Locus and us. Fetch is probably a distant third after that.
Both you and Fetch have been taken over.
Yes. We were acquired in 2019. Fetch was acquired [in 2021].
Why was that the right move? Have you considered going public or going in a different direction?
In 2019, when we raised money, we did well. But Shopify presents itself and says, “Hey, we’re interested in investing in the space. We want to develop a logistics network. We need technology like yours to make this happen. We have the right team; you know space. Let’s see if this works.”
What we’ve been able to do is use a huge amount of investment from Shopify to grow the business. We were about 120 employees at 30 locations. We now have 420 employees and more than 110 offices worldwide.
Amazon buys Kiva and blocks third-party access to their robots. That must have been a discussion you had with Shopify.
In front. “If that’s the plan, we’re not interested.” We had a strong positive trajectory; we had strong investors. Everyone was very optimistic about it. That’s not what it has been. It’s been the opposite. We are run independently of Shopify. We continue to invest and grow the business.
From a business perspective, I understand Amazon’s decision to shut down access and give itself an edge. What does Shopify gain if someone can still use your robots?
Shopify’s mantra is very different from Amazon’s. I am responsible for Shopify’s logistics. Shopify is the brand behind the brand, so they have a relationship with merchants and the customers. They want to have a relationship with the merchant. It’s about building the right tools and making it easier for the trader to succeed. Supply chain is a big problem for many traders. To sell the former, they must comply with the former, so Shopify makes it easier for them to print a shipping label.
If you now have to do 100 mailing letters a day, you are not going to do it alone. You want us to do it for you, and Shopify has built a fulfillment network using many third parties, and our technology is the backbone of the warehouse.
Your technology is built for brownfield structures.
That’s correct. We can go in and just deploy with the technology. We can enter existing customer warehouses without having to change anything. This enables a very short implementation time. That is one of the big advantages. We achieve that double productivity in a few weeks, instead of destroying a building and starting over with a new system.
But if they want to go greenfield, you can start from scratch and actually build around the technology.
That’s right. Maybe 10% of our install base is greenfield.
Looking at you – Locus of Fetch – you kind of keep a form factor. Clearly, Amazon is diversifying. I imagine that for many of these customers, the ideal robot is something that is not only mobile and autonomous, but actually does the picking itself. Is this something you are researching?
Most of the AMR (autonomous mobile robot) scene has reached a point where the hardware is commercialized. The robots are generally quite reliable. Some may be higher quality than others, but what matters most is the workflows performed by these robots. The big thing that sets Locus and us apart is that we actually come in with predefined workflows that do a specific type of work. It’s not just a generic robot that comes in and does things. So you can integrate it into your workflow very quickly, because it knows you want to do batch picking and sorting. It knows that you want to pick orders discreetly. These are all workflows that are predefined and populated in the solution.
In terms of solving the grab and pick, I’ve long said it’s a very difficult problem. I’m not sure if e-comm or picking from the trash is the right place for that solution. If you think about the infrastructure required to go into an aisle and grab a pink shirt versus a blue shirt in a dark aisle using robots, that’s not working very well right now. Therefore, goods-to-person makes more sense in that environment. If you’re trying to use weapons, a Kiva-like solution or a shuttle-like solution, where the inventory is brought to a station and the lighting is there, then I think weapons will be effective there.
Do you invest in R&D in this kind of problem?
Not the picking side. In the world of the total addressable market – the industry as a whole, between Locus, us, Fetch and others – has a penetration rate of maybe 5%. I think there are plenty of opportunities for us to start deploying a lot of our technology in other places. I also think the logical extension is around the box and pallet operations.
Interoperability is an interesting conversation. Nobody makes robots for every use case. If you want to become almost completely autonomous, you need a lot of different robots.
We will not accommodate 100% of the choices in the building. For the 20% that we don’t, you still leverage all the goodness of our management consoles, our training and things like that, and you can expand with [the mobile fulfillment application]. And it’s not just picking. It’s received, it’s put away, and everything else. It is the first step for us to prove our wall-to-wall capabilities.
What does interoperability look like?
We are doing system interoperability today. We communicate with automation systems in the field all the time. That is an important part of interoperability. We pass on important messages about how big a box to build and in what order to build it.
When you’re independent, you’re focused on portability. Does that pressure change when you get acquired by a Shopify?
I think the difference with Shopify is that it allows us to think long term in terms of doing the right thing without having the pressure from investors. That was one of the benefits. We provide a lot of software betting for the longer term.