Most of the time, online grocery orders come together the same way you’d shop yourself. The difference is that you don’t walk the aisles picking out items — grocery store employees do.
To Takeoff Technologies, that sounds like a job for a robot. The Waltham startup has developed automated warehouses that can fit in the back of existing stores, and need just a few minutes to assemble orders of up to 60 items, which can then be picked up or delivered. Some of the world’s largest supermarket chains are working with the company to change how they fill online orders; Takeoff has $86 million in investment.
Robotic order fulfillment has already become common in online retail — led in part by Amazon and its North Reading-based robotics unit (formerly Kiva Systems). But grocery shopping has proven stubbornly difficult to automate, even as online orders have increased. “This is the hardest category of them all,” says Max Pedró, a former Walmart executive who cofounded Takeoff Technologies in 2016. “You have a lot of items that are super heavy, and you need to do all the right things with temperature control — managing perishables. It’s a different animal,” he says.
Takeoff’s approach is basically to build a vertical grocery store, with stacked shelving. Small robotic devices pull bins of grocery items and put them on lines that then are conveyed to a person who stands at a terminal completing orders. Pedró says Takeoff’s systems can hook into stores’ existing inventory, ecommerce, and delivery programs (it can also arrange delivery services for stores that don’t already offer them). Putting one in an existing store typically costs between $3 million and $4 million.
While Takeoff is working with the parent companies of Stop & Shop, Star Market, and Shaw’s, its first site in Massachusetts is slated to open later this year at a Big Y store in Chicopee. Takeoff plans to expand in 2020 from five locations to 50.
A number of other companies are trying to solve this problem. North Billerica’s Alert Innovation makes a similar “micro-fulfillment center,” which Walmart is piloting in a store in Salem, New Hampshire. Other competitors include Dematic, an Atlanta-based unit of Germany’s KION Group; the Israeli company Fabric; and Ocado Group, from the United Kingdom. Grocery chains are looking to fend off Walmart, Target, and Amazon.com, which acquired Whole Foods in 2017.
While delivery and online pickup still make up only a small part of the grocery business, it’s among the fastest-growing segments. And Pedró believes grocery store automation is here to stay. If he’s right, stores will likely get smaller, and will probably have fewer employees in traditional roles. But food deserts should also dwindle, since small automated stores would likely make it easier to bring supermarket-type selection to underserved areas.
Not that people will stop going to grocery stores. Pedró says people will buy their staples online, and go to grocery stores for the fun part of food shopping. “You’ll have a coffee, and you’ll have flowers, and you can try out cheeses, and select your lamb chop,” he says. “But who gets excited about selecting toilet paper?”
Takeoff Technologies eGrocery
Speed: Gathers and bags up to 60 items in five minutes or less
Size: 10,000 square feet (minimum)
Construction time: Approximately 20 weeks
Cost to build: $3 million to $4 million