rolls out Kiva robots for holiday season onslaught
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[December 01, 2014]
By Deepa Seetharaman
TRACY, Calif (Reuters) - Amazon.com Inc has
installed more than 15,000 robots across 10 U.S. warehouses, a move that
promises to cut operating costs by one-fifth and get packages out the
door more quickly in the run-up to Christmas.
The orange 320-pound (145 kg) robots, which scoot around the floor
on wheels, show how Amazon has adopted technology developed by Kiva
Systems, a robotics company it bought for $775 million in 2012.
Amazon showcased to media on Sunday ahead of Cyber Monday, the
biggest online shopping day of the year.
The robots are designed to help the leading U.S. online retailer
speed the time it takes to deliver items to customers and better
compete with brick-and-mortar stores, where the bulk of Americans
still do their shopping.
The robots also may help Amazon avoid the mishaps of last year's
holiday season, when a surge of packages overwhelmed shipping and
logistics company UPS and delayed the arrival of Christmas presents
around the globe. Amazon offered shipping refunds and $20 gift cards
to compensate customers.
Amazon deployed the robots this summer, ahead of the key holiday
quarter, when the company typically books about one-third of its
annual revenue. The updated warehouses are in five states --
California, Texas, Florida, New Jersey and Washington.
The move comes at a cost. Amazon estimated in June 2013 that it
would spend about $46 million to install Kiva robots at its
warehouse in Ruskin, Florida, including $26.1 million for the
equipment, according to company filings to local government.
The Kiva robots have allowed Amazon to hold about 50 percent more
items and shorten the time it takes to offer same-day delivery in
several areas, said Dave Clark, senior vice president of worldwide
operations and customer services.
At Amazon's warehouse in Tracy, California, workers stack goods in
shelves carried by more than 1,500 Kiva robots, which use markings
on the floor to navigate and form a "big block of inventory," Clark
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Squeezing the racks of items closely together eliminates the need
for workers to navigate aisles to collect items ordered by
consumers. Now, a worker calls for specific items and the robot
steers itself to their particular work station. Each robot can carry
as much as 720 pounds.
In some cases, the robots have allowed Amazon to get packages out
the door in as little as 13 minutes from the pick stations, compared
to about an hour and a half on average in older centers.
"It's certainly proving out that it's justified itself," Clark said
of the Kiva acquisition. "We're happy with the economics of it."
(Reporting by Deepa Seetharaman; editing by Keith Weir)
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