Micro Fulfillment Market for Grocery and General Merchandise By Technologies (AutoStore, Shuttle Based), By Warehouse Size, By Geography - Forecast to 2026

Micro Fulfillment Market – A cumulative opportunity worth ~$10B by 2026 driven by online grocery and urban warehouses

Introduction


Micro Fulfillment Centers (MFCs), a highly recommended popular e-commerce strategy, is an effective way to meet the rising volumes, the changing geographical nature of e-commerce demand, and the growing desire for same-day delivery. As per the latest market research study, Micro Fulfillment Market is expected to have a cumulative opportunity worth ~$10B in next 6 years by 2026 with an installed base of ~2000 MFCs if the technology and concept remains permanent. Year 2022 is going to be the cornerstone for Micro Fulfillment market touching a billion-dollar mark and setting the base for the future. It is expected that there will be one micro fulfillment center for every 10th of U.S. total 40000 grocery stores by 2030.

This post-pandemic market study is having a market analysis of more than 75 players (part of our exclusive Market Map), Key Technologies, Targeted Warehouse Sizes and 20 geographic regions although this market is getting adopted mainly in U.S. at present. Analysis is validated through 50+ in-depth interviews across the value chain with components and technology providers, system integrators & manufacturers, grocery stores and end-user industry verticals. Market size tables are also available in an excel format to analyse further. It is a best reference to analyse the market attractiveness, to identify the partner, customer or supplier, to check the competitive landscape, to benchmark the new technologies and to select the right geography & industry vertical for your products and services. Voice and opinion of grocery stores have been taken as the key parameter for this market forecast. As per the study, Micro Fulfillment Market will reach to 10X mark by 2025 as compared to current market size.

Micro Fulfillment – Need of the hour

Industry giants such as Amazon, Walmart, Ocado, Kroger and Alibaba are driving the “best-in-class” e-commerce fulfillment strategy for the last decade. They are also investing in cutting-edge robotics and automation for their Customer Fulfillment Centers (CFCs) – that are continuously redefining target productivity and service levels. But these centralized fulfillment centers are situated far away from the city and have an additional transportation cost along with considerably more delivery time as compared to consumer’s expectations, especially in grocery and F&B industry. Online grocery is already having a slim profit margin and micro-fulfillment has the ability to increase its margin and to make e-commerce accessible to a broader range of retailers because it cuts down major costs like

  • The cost of storage, retrieval and picking (through automated MFC)
  • The cost of the last mile delivery (through hyperlocal placement)
  • The cost of real estate (through condensing fulfillment centers down into MFCs)
That’s why, Micro Fulfillment Center (MFC) is a perfect solution for urban warehouses with an approximated size between 5000 SF and 25000 SF that can meet the requirement of same day delivery through in-store picking or multiple last-mile delivery options. It can even be deployed at backside of the retail store, malls or basements. A typical MFC system is having 1-2 aisles Dry + 1-2 aisles Chilled, 5,000-8,000 totes 10-high storage to 24’ x 2-deep, 2 decanting stations and 2-4 pick stations with each station picking at 700-800 UPH.

Top Factors
  • It is estimated that online grocery will contribute more than 10% of overall grocery sale in US by 2025.
  • It is expected that consumers will continue with habit of buying online grocery developed during pandemic.
  • Delivery option may vary as Home Delivery, In-Store Pick Up, Curb side Pickup, Locker Delivery etc.
  • Urban warehouses with automation will be key to meet this demand with same day delivery expectations.
  • Delivery Fee is the one of the key factors to decide the digital channel.
  • Key to make online grocery business more profitable as compared to current scenario of either net loss or thin profit margin
Micro Fulfillment Centers – Advantages
  • Low CapEx and TCO; Even OpEx model works quite well like pay per pick or RaaS
  • Lesser time to build and install (4-8 weeks)
  • Eliminates the requirement of Conveyors
  • Faster delivery for end-customer (same day delivery)
  • Low cost for labor (automated fulfilment) and better last mile delivery (closer to end-customer)
  • Home Delivery and In-Store Shopping, both options are open through In-store Fulfillment
  • Direct relationship between retailer and customer. No or minimum 3rd party involvement for this customer experience
Micro Fulfillment Market Trends

Micro Fulfillment Market has been the most important and emerging trend during pandemic (covid-19) coming out from some bigger trends like eGrocery Growth, Urban Warehouses and Automated Cold Storages. Huge investment in start-ups like Takeoff Technologies ($86M+), Fabric ($136M+), Attabotics ($82M+), Exotec Solutions ($111M+) and Alert Innovation are witnessing this growth along with presence of existing traditional players like Dematic, Swisslog, Knapp, OPEX Corporation, Muratec, AutoStore, Honeywell Intelligrated and Vanderlande. Retailers such as Walmart, Amazon, Kroger, Woolworths, Amazon, Ocado, Carrefour, Uniqlo, Meijer, H-E-B, Albertsons, Majid Al Futtaim and Ahold Delhaize have already started adopting and implementing these new technologies during pandemic. Apart this, piece picking robots’ suppliers like Berkshire Grey, Righthand Robotics, Kindred AI, Covariant, OSARO, Plus One Robotics, XYZ Robotics, Fizyr have established a new attractive capability for order picking in ecommerce fulfillment to transfer the good-to-person (G2P) systems into good-to-robot (G2R) systems.

As per this market study, Micro Fulfillment Market is expected to grow with a CAGR of ~60% between 2020 and 2026 with a maximum market share from U.S. Recently developments have been started in Europe and APAC as well for countries like U.K., France, Japan and Australia. Even there are some order intake in UAE, Saudi Arabia and Israel from middle east region as well. Grocery is going to be the main contributor for this market with 70%-80% market share although general merchandise and other industries are also going to adopt the market very soon.

Coming to MFC system architecture and technologies, AutoStore is an old and proven technology with hundreds of installations in ecommerce fulfullment including the recent partnership with Swisslog and H-E-B for micro fulfillment center in U.S. but they are going to face a very good competition in MFC space from new players like Takeoff Technologies, Fabric, Exotec Solutions, Attabotics and Alert Innovation. Established system integrators like Dematic, Honeywell Intelligrated, Vanderlande and Knapp are using the traditional shuttle and ASRS systems which are good and already proven for big fulfillment centers but not 100% ideal for micro fulfillment yet. At the same time, Attabotics, Alert Innovation, and Exotec are using emerging 3D technologies having good architecture specific to MFC with high density and no point of failure but it will too early to say anything as there are only few installations and not 100% proved yet. Apart this, software is going to be the main differentiator and value add for MFC systems as some suppliers are having their in-house software capabilities and others are having a partnership to do the needful. As per our discussion with technology suppliers and industry experts, every technology and architecture are having its own advantage and disadvantage depending upon the grocery store’s location, current requirement, capital expenditure, fear of digitalization and automation from big players, and insecurity related to its consumers’ information.

Key Players in Micro-Fulfillment Market Ecosystem:
  • Technology Providers: Takeoff Technologies, Fabric, Alert Innovation, Exotec Solutions, Autostore, Opex Corporation, Dematic, Attabotics, Ocado, Addverb Technologies, Vanderlande, TGW, Honeywell Intelligrated and Swisslog
  • AutoStore Partners: Swisslog, Dematic, AM Logistic Automation, Okamura, Pulse Integration, LG CNS, Fortna, Kuecker Logistics Group, Hörmann Logistik, ALStef, Bastian Solutions, TKSL, Lalesse Logistic Solutions, Element Logic
  • Other Key Players: AHS, Muratec, Knapp, FoodX Technologies, S&H Systems, Conveyco, NanoFC, Dexter, Tompkins Robotics, Geekplus, Myrmex, Locai, HDS, i-collector, Storojet, Grey Orange, G.I.Eicom
  • End Customer: Sedano’s, Walmart, Nordstorm, Ahorramas, Meijer, Uniqlo (Fast Retailing), Cdiscount, Carrefour, Leclerc, PepsiCo, H-E-B, Alpen Co., Ltd., Albertsons, Ahold Delhaize, Wakefern Food Corp., Majid Al Futtaim, Big Y, Woolworths, Loblaws, Associated Wholesale Grocers (AWG), Korger, Sobeys, Amazon, Fresh Direct, Super Farm, Rami Levy
Key Questions to be answered through this study
  • What are the major trends and drivers impacting the Micro Fulfillment Market?
  • What is the revenue outlook (TAM) and forecast till 2026 for Micro Fulfillment Market by top segments such as Technologies, Industry Verticals, Warehouse Size, and Countries?
  • What are the key investments, partnerships and M&A in Micro Fulfillment space?
  • What is the competitive landscape of Micro Fulfillment Market?
  • What are the strategic imperative and calls to action that will define growth and success within Micro Fulfillment by 2026?
The information contained in this report was obtained from both primary and secondary research. Primary research entailed in-depth, F2F and telephonic discussion across the value chain. Extensive company, system integrators, and retailers interviews were conducted.Our post-pandemic version is having a detailed market analysis of more than 75+ players (part of our exclusive Market Map). Analysis is validated through 100+ in-depth interviews across the value chain with components and technology providers, system integrators & manufacturers and end-user industry verticals.


1 Introduction
Online Grocery Ecosystem
Micro Fulfillment Center (MFC)
Need of Micro Fulfillment Center (MFC)
Centralized Fulfillment Center (CFC) vs Micro Fulfillment (MFC)
Types of Micro-Fulfillment Center (MFC)
Prior Requisite to implement a Micro Fulfillment Center (MFC)
Automation Technologies used for MFC
2 Micro Fulfillment Market – Industry Analysis
Drivers & Challenges
Pandemic (COVID-19) Impact
Demand for Online Grocery
End-User Behavior and Digital Channels
3 Cost Comparison and Profit Margin
Micro Fulfillment Center (MFC) vs Centralized Fulfillment Center (CFC)
Inventory Carrying Cost (ICC)
Customers Preference – Price vs Convenience
Cost Advantages
4 Micro Fulfillment Market By Warehouse Size – Installed Base and Market Size (USD Million)
Less than 5000 Sq. Ft.
Between 5000 Sq. Ft. and 25000 Sq. Ft.
More than 25000 Sq. Ft.
5 Micro Fulfillment Market By Technology Solutions – Installed Base and Market Size (USD Million)
AutoStore
Shuttle Based
Other Technologies
6 Micro Fulfillment Market By Goods – (USD Million)
Grocery
General Merchandise
Others
7 Micro Fulfillment Market By Solution – (USD Million)
Micro Fulfillment Equipment
MRO and Digital Services
8 Micro Fulfillment Market By Geography – Installed Base and Market Size (USD Million)
North America
United States (U.S.)
Canada
Mexico
Europe
United Kingdom (U.K.)
Germany
France
Italy
Spain
Netherlands
Nordic Region
Rest of Europe
Asia Pacific
China
Japan
South Korea
Australia
India
South East Asia
Rest of APAC
Rest of World
Middle-East & Africa
South America
9 Emerging Trends
Goods to Robots (G2R)
Piece Picking Robots
Artificial Intelligence and 3D Machine Vision
Delivery Robots
10 Competitive Landscape
Micro Fulfillment Market Map
Market Share Analysis
Major Partners
Key Clients By Supplier
Investment Details
Key Developments (Acquisitions, Contracts and Partnership)
Geographical Reach
11 Companies Analyzed
Technology Providers
Takeoff Technologies
Fabric
Alert Innovation
Exotec Solutions
Autostore
Opex Corporation
Dematic
Attabotics
Ocado
Addverb Technologies
Vanderlande
TGW
Knapp
Swisslog
Honeywell Intelligrated
AutoStore Partners
Swisslog
Dematic
AM Logistic Automation
Okamura
Pulse Integration
LG CNS
Fortna
Kuecker Logistics Group
Hörmann Logistik
ALStef
Bastian Solutions
TKSL
Lalesse Logistic Solutions
Element Logic
Other Key Players
AHS
Muratec
FoodX Technologies
S&H Systems
Conveyco
Dexter
Tompkins Robotics
Geekplus (Geek+)
Myrmex
Locai
HDS
i-collector
Storojet
Grey Orange
G.I.Eicom
End-Customer
Sedano’s
Walmart
Nordstorm
Ahorramas
Meijer
Uniqlo (Fast Retailing)
Cdiscount
Carrefour
Leclerc
PepsiCo
H-E-B
Alpen Co., Ltd.
Albertsons
Ahold Delhaize
Wakefern Food Corp.
Majid Al Futtaim
Big Y
Woolworths
Loblaws
Associated Wholesale Grocers (AWG)
Korger
Sobeys
Amazon
Fresh Direct
Super Farm
Rami Levy

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