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Scott Kirsner | Innovation Economy

Robots in aisle 2! These startups want to change the way you shop for groceries

John Lert, CEO of Billerica startup Alert Innovation, which is developing robotic automation systems to fill grocery orders.
John Lert, CEO of Billerica startup Alert Innovation, which is developing robotic automation systems to fill grocery orders. SCOTT KIRSNER/FOR THE BOSTON GLOBE

In a North Billerica industrial park, a startup called Alert Innovation employs 75 people who are working hard to end your weekly stroll down the aisles of a grocery store. In Waltham, Takeoff Technologies, based in a former watch factory, is focused on the same goal. Takeoff just raised $24 million in additional funding this week, and in August Walmart said it would work with Alert to test the startup’s technology in a Salem, N.H., supermarket.

Both companies are betting on two dynamics.

The first is that time-crunched consumers increasingly want to have groceries delivered to their homes, or be ready for pickup when they swing by a store after work.


The second is that as Amazon continues to invest in its AmazonFresh grocery delivery service, the e-tailer’s vaunted operational efficiencies will make life very difficult for traditional grocery stores that aren’t ready to compete.

According to the e-commerce research firm One Click Retail, Amazon is already the top player in online grocery orders, with about 18 percent of the market.

“They are a formidable player that is playing to win,” says Takeoff’s president and cofounder, Max Pedró.

Takeoff and Alert have a similar vision: turning at least part of the grocery store into an automated robotic warehouse, and perhaps letting us humans shop for some of the things we really want to select ourselves, like a piece of fish or a pint of strawberries.

John Lert, CEO of Alert Innovation, has already built and sold one company that introduced robots to the grocery business: Symbotic LLC, of Wilmington, which focused on helping grocery warehouses, not individual stores, operate more efficiently.

He says that with Alert, he “had to start completely from scratch,” and the company has spent two years designing everything from the circuit boards inside its robotic carts to the steel shelving that will hold plastic “totes” full of individual grocery items. (Alert designed the totes itself.)


The job of Alert’s robotic carts is to serve as a mini-flatbed truck, carrying totes of merchandise to the shelves as new products arrive at the store, and then navigating through a compact warren of shelves to pick up the right totes when you order, say, a box of Frosted Mini-Wheats. That tote goes to a “picking station,” where a human worker is waiting. A light shines on the specific area of the tote where the cereal is sitting — some totes hold a few different items — and the worker adds it to your order.

Bill Fosnight, a cofounder of Alert, says that a worker standing still at a pick station can handle 600 to 800 items an hour, compared with an ultra-efficient worker roaming the aisles of a traditional store, who can grab roughly 80 items an hour. (You are probably rated at about half that speed.)

That kind of increase in productivity, Fosnight and Lert contend, will enable grocers to offer home delivery or store pickups much more profitably.

Their system also may prove better at knowing when items are about to run out, replenishing the stocks automatically. That helps eliminate the problem of either substituting or skipping an item that was on your list.

Alert is beginning to install its technology this month in an addition that Walmart is building at its Salem store. It should be operational by early 2019.


Takeoff seems likely to get its technology up and running in a store first, as soon as next month. But that’s primarily because the company is relying on a somewhat less-sophisticated “shuttle” technology developed by one of its suppliers, KNAPP AG of Austria, to move items from the shelf to a human-run pick station.

Pedró says the system will cost stores “in the low millions of dollars” to install, but will deliver a return on that investment in less than a year, with the increased efficiencies.

Takeoff is writing its own software to manage orders and supervise the automated system. But Pedró emphasizes the advantage of relying on automation equipment from KNAPP that has already been in use in warehouses and factories for about 17 years.

Pedró says the company’s first deployment will be integrated into an existing grocery store on the East Coast, but not in Boston.

“For the next 12 months, we’ll be installing one [system] every six weeks,” he says, noting that the company is already working with five grocery retailers. “We’ve gone into full roll-out mode.”

Takeoff has raised about $42 million in funding; Lert doesn’t want to be specific about how much his startup has collected, but says it’s in the same ballpark.

Installing robotic systems to make grocery stores more efficient is a less-costly approach than building new warehouses or distribution centers. But it’s still a capital-intensive endeavor, and the grocery industry is known for its thin profit margins — in the neighborhood of 2 to 2.5 percent, Pedró says.


That could mean the future of the grocery store is “now a big boy’s game,” in the words of Tim DeMello, played best by megaliths like Amazon, Target, Walmart, and Kroger Co. DeMello founded an early home grocery delivery startup, Streamline.com, in the late 1990s. He’s now an AmazonFresh customer — as is his 25-year-old daughter.

“I just don’t see millennials going to grocery stores five years from now,” DeMello says. “They’re so accustomed to the home delivery side. My daughter lives in South Boston, and she and her roommates put their money together via Venmo, and they shop from AmazonFresh.”

Boris Planer, chief economist at PlanetRetail RNG, a research and advisory firm, says that while retailers are open to introducing automation, many are “really hesitant to go all in,” in part because there is “no obvious, mature technology that would deal with their fulfillment issues across a portfolio of thousands of stores.”

And grocery chains, Planer notes, may be wary of the negative publicity that will accompany workforce reductions.

“Retailers have provided career entry points for people with limited education,” he says, but half of those jobs could vanish as consumers shift to online purchasing and delivery.

Will those job losses cause societal problems? Absolutely. Will you eschew the time savings of grocery delivery to preserve the jobs of human shelf-stockers and cashiers? You tell me.

But Takeoff and Alert, along with many other robotics startups in Boston, are planning to supply the technology that fuels a far more automated retail industry — they’re not worrying about preserving the status quo.


Scott Kirsner can be reached at kirsner@pobox.com. Follow him on Twitter @ScottKirsner.