Monthly Archives: January 2015

Retail Disruption. Are Company Executives in Denial and not watching their Frontiers?

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I was at a dairy meeting this week. Senior management of companies from all over the US come together to discuss market trends, regulatory issues and food safety. Their companies make the cheese, yogurt, dairy ingredients and other dairy products that we all eat. It is a highly experienced group from small, medium and large companies.

Normally the audience is very up-to-date and not much surprises them. This time one session really opened their eyes and gasps could be heard.

The speaker was Dan O’Conner from RetailNet Group, as they put it: a leading Global Retail Intelligence Resource helping Retailers and Suppliers plan tomorrow’s strategies today. He showed digital trends and the impact on the dairy business. The audience was silent and in full attention.

Dan spoke about how apps change customer shopping and especially that they “wall off” the users and make competition much more difficult. Apps will become the new loyalty programs.

The growth of customer toolkits that allow for a much more personalized experience and easier click and buy. These toolkits include: product scanning, creation of shopping lists based on scanned products, recipes, coupons and delivery options. The delivery options are getting faster and faster with major emphasis on same day delivery. Amazon is the leader in the retail industry and is forcing the major retailers to rethink everything.

Over time total transparency will be expected by many customers. This includes ability to see ingredients, sustainability of supply, origin of sensitive ingredients, etc. All this will be available through the content of apps. The impact on sourcing of ingredients is considerable.

It is expected that over the next few years volume will shift away from stores and that about 25% of todays volume will take place without store interaction, of that15% will be pick and deliver. This highlights that companies need to provide both web and store channel options (clicks and bricks). The increased cost can be quite significant and a totally new set of employee skills is needed. On top of that, supply chains will become more complex and need to be flexible.

Finally, in all cases the increase of marketplaces changes the dynamics. They have the fastest growth and need to be considered as a source of revenue. However, profitable pricing is more difficult and requires new ways to add value.

For me the reaction of the audience showed that most companies are still in denial of the changes that are happening in their industry. They are not watching the frontiers of their business. Not a good sign. Time to wake up.

Bluesmart carry-on suitcase can’t get lost

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The Bluesmart acts as a high-tech travel buddy.Bluesmart

Up until recently, the humble suitcase had pretty much one job to do: keep your stuff together so it doesn’t scatter to the four directions when you go traveling. There have been a few tech innovations when it comes to suitcases, but none quite so complete as what you’ll get from the Bluesmart, a connected carry-on that works with your Android or iOS smartphone. The smart luggage is raising funds on Indiegogo to go from prototype into production.

The creators of Bluesmart have thrown just about everything they can think of into the design. Before you even head out the door, the suitcase helps you out with packing with its built-in digital scale. Pull up on the handle and check the weight on the app to see if you’ve overstuffed or packed just the right amount. Outlets can be few and far between when you’re on the go, so Bluesmart also has a built-in battery for charging up your tech gear.

A digitally controlled lock lets you access your suitcase using your smartphone. It can also be set to automatically lock itself if you become separated. If the battery dies, you can still get in with a special key. The lock is also usable by the TSA so you don’t run afoul of regulations should you have to check the bag.

Naturally, you’re attached to all the clothes and equipment stashed in your carry-on and you don’t want to lose it. For starters, Bluesmart has a Bluetooth proximity sensor function to send you alerts if you or your suitcase wanders off and to help you track it back down again using a proximity heat map.

There’s also GPS on board for locating the wayward luggage on a map if you get parted by a greater distance than the proximity feature can handle. This could also be very helpful in the event you have to check the bag and it disappears into the murky depths of the airline’s baggage system.

Storage situated at the front of the bag lets you quickly access your laptop and other electronic gear so you can roll through TSA checks. Avid travelers may also enjoy seeing their trip data collected on the Bluesmart app, including which airports you’ve been at, how long you’ve spent in each country and the number of miles you’ve covered during your journeys.

All the tech is cool, but you also need a functioning suitcase to go along with it. To that end, the Bluesmart is designed with waterproof zipper, anodized aluminum for the handle and four spinner wheels. It has a 34-liter capacity and the current prototypes weigh 8.5 pounds, though the Bluesmart team is working on making it lighter.

Bluesmart launched on Indiegogo with a $50,000 goal, but it seems the idea of a smart suitcase is a popular one. It has over $304,000 in pledges with 33 days left to run. The Bluesmart price is not far off from other high-end suitcase offerings. It’s going for a $265 (about £165, AU$302) pledge. It’s not too hard to see the appeal since the Bluesmart is shaping up to be a traveling gadget lover’s dream luggage.

Bluesmart suitcases
Bluesmart prototypes have already been traveling the world.

Small Businesses Embrace Technology to Boost Efficiency—with Robots.

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By JOHN REVILL in WSJ
Dec. 26, 2014

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PHOTO: ACTION PRESS/ZUMA PRESS

ZURICH—A German brewer established in the 1790s has found a 21st-century answer to increasing profitability: robots

Nine years ago, Badische Staatsbrauerei Rothaus AG was struggling with production bottlenecks that weighed on its profits. Workers couldn’t package and crate the company’s beer quickly enough to stock bars and supermarkets, prompting customers to buy other brands.
Since introducing an ABB Ltd. IRB7600 robot in 2005, however, the company has sped up its delivery times, particularly at peak holiday periods. The robot does the heavy lifting, sorting through 30,000 bottles an hour, allowing the company to reassign its human employees to its bottling and packaging operations.

“We wanted to increase production and efficiency” across the company, Chief Executive Christian Rasch said on a recent Wednesday as a robot painted in the company’s signature traffic-light red stacked cases of beer behind him. The brewery, which hasn’t changed its recipe in more than two centuries, was so impressed it bought four more ABB robots.

ABB, Fanuc Corp. and other robot makers are counting on Rothaus and a variety of small and medium-size companies to fuel the next leg of their growth. Historically driven by automobile companies and electrical-and-electronics makers, robot companies are finding many smaller businesses want to automate dirty and repetitious tasks that were typically handled with good old-fashioned elbow grease.

In Murten, western Switzerland, a local bakery is using robots to bag pretzels, grabbing them off the production line while they’re still hot. In the U.K., a Yorkshire brickworks has robots removing fired blocks from the kiln. In a New York hotel, robots have begun serving as porters, delivering luggage to guest rooms.

Data on the use of robots at smaller companies is hard to come by, and automobile and electronics manufacturers remain the industry’s biggest customers. But the International Federation of Robotics, an industry association, said sales to all industries excluding the big buyers rose 10% in 2013, with growth coming from the metal, food-making and chemicals industries. By comparison, sales to the auto industry rose 4%. Sales of robots rose 12% to $9.5 billion, while sales of robot systems, which includes conveyor belts and other machinery, were $29 billion.

Robot makers are trying to encourage small companies by making their machines easier to use. Many are concentrating their research-and-development efforts on streamlining interfaces so that novices feel comfortable operating them.

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‘The vision is for us to make robots as simple to use as a smartphone.’
—Per Vegard Nerseth, who runs ABB’s robot division

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Zurich-based ABB is working on a robot that customers can program by moving the arms to perform a desired action, the same way a parent might guide a child assembling blocks. The company, which expects to bring the new robot to market in April 2015, wants to eventually build one that doesn’t require an instruction manual.

“The vision is for us to make robots as simple to use as a smartphone,” said Per Vegard Nerseth, who runs ABB’s robot division. “A lot of the smaller companies, such as bakeries,” he said, “may have qualified bakers, for example, but not lots of robot technicians.”

Japan’s Fanuc overcame skepticism at Marshalls , an Elland, England-based building-supply company, by offering the potential customer a trial robot for six months. Marshalls used the robot to perform a chore that was unpopular with its human employees: placing concrete slabs in an oven and removing the blocks after they’ve been baked.

After six weeks, Marshalls could see the Fanuc R2000iB robot was making a difference and placed an order for five. Since then, it has bought more and now has 63 robots toiling at its 11 plants.

Chris Sumner, who runs Fanuc in Europe, estimates roughly 80% of Fanuc’s European customers are small and midsize businesses, and the number is growing by 20% every year. Small businesses generally buy one or two robots at a time, but Fanuc is trying to encourage more automation: The company runs training classes for customers considering a robot and set up a dedicated hotline for its smaller customers.

“Small companies are concerned they will not get the service of the bigger customers,” Mr. Sumner said. He says Fanuc can devote more resources to servicing smaller enterprises because many bigger companies have in-house engineers.

Kuka AG , a German robot maker, has about 7,500 orders for robots in Germany, roughly a fifth of which are for smaller projects, according to Joerg Winter, who runs sales in the country. Many of those customers are small and midsize businesses, a customer segment that is growing, he says. Kuka robots range in price from €13,000 ($15,800) to €200,000.

At Rothaus, the German brewer, robots have helped the company speed up packaging and overcome staff shortages, a problem in the sparsely populated Black Forest region.

Before the robot—nicknamed Roger-Tor after the manager of the packaging line—was introduced, employees were unloading 24-bottle crates of beer and repackaging them into more-popular six-packs. Over the course of a day, workers would slow down and become more prone to dropping bottles.

Now, the output has climbed to 250 million bottles a year, four times its output 20 years ago. Sales reached €80 million and pretax profit hit €20 million in 2013.

The company has since installed robots at its filling plant. The robots lift kegs for cleaning and then fill them with beer. The robots then sort the full kegs, which weigh 139 pounds, for delivery.

“Nobody wants to do this boring, heavy work,” said Mr. Rasch, the chief executive. “We couldn’t imagine living without a robot.”