How Materials Handling Is Evolving from 2023 into 2024

What a year it was. In 2023, materials handling operations worked smarter than ever as consumers began returning to brick-and-mortar stores.

For many brands this was a year of reflection marked by an effort to understand at a more granular level the normalizations of consumer behavior and buying preferences that evolved. Many used this time to try to understand not only where growth will occur and what it means for their business, but also how they can make their materials handling and fulfillment operations even more effective.

Simultaneously, several trends emerged – or one could argue remained – as top-of-mind concerns for warehouse operators and executives. With that in mind, here are some thoughts on the trends that shaped 2023 and predictions for what will remain particularly prescient in the year to come.

“2024 looks to be the year for omnichannel fulfillment, with efforts focusing on how to make systems more efficient across brick-and-mortar and online operations. “
Jake Heldenberg
head of solution design, warehousing North America

Omnichannel, the new normal

2023 was a year of resetting expectations as online sales plateaued, or even declined, and consumers gravitated back to the brick-and-mortar stores they missed during the pandemic. The pendulum swung heavily from virtual and online interactions to in-person ones in the retail sector. Across the board there was a dramatic increase in people getting out-and-about. Airlines for example saw sales volumes return to, and in many cases surpass, pre-pandemic levels.

At the start of the year, executives at many companies reflected on what they had learned about consumer shopping behavior and asked themselves how they could predict what e-commerce levels would look like going forward. As the year progressed, there was a growing consensus that we had reached a more normal, balanced state.

The realizations that accompany this shift, namely that most consumers are now omnichannel shoppers, will be a driving factor in the year to come. This will prompt many to again invest in efforts to transform their warehouses and distribution centers in 2024, but with an important caveat: The focus is no longer solely on brick-and-mortar or e-commerce operations.

Instead, most will look at how they can operationalize omnichannel approaches that inherently make their businesses more flexible and agile. 2024 looks to be the year for omnichannel fulfillment, with efforts focusing on how to make systems more efficient across brick-and-mortar and online operations.

Labor, the driver of robotics

The ongoing shortage of labor remained a universal challenge across materials handling operations in 2023. Warehouses and distribution centers of all sizes, and in every geography continued to grapple with how to attract new talent and retain existing employees.

Consequently, materials handling experts at many organizations looked with greater interest at how automation can help to alleviate the corresponding shortfalls, particularly in areas that are more prone to employee churn. Among them are tasks in which employees are likely to be injured because tasks are difficult and highly repetitive. More specifically, interest in robotic item picking and flexible automated storage and retrieval systems (AS/RS) continued to grow, although there were no exponential increases in adoption one might expect given the rapid pace of innovation today.

Simultaneously, in organizations where robots are being used, employees continued to embrace them with greater enthusiasm. Many now view them as another tool, just as advancements in automation like conveyors and automated storage and retrieval systems are now taken for granted in many large warehouses.

Related to these developments, several trends will take shape around robotics in 2024. First, robotics will see more aggressive adoption, with many businesses deploying robots in their distribution centers and warehouses. This is particularly in item picking where gains in vision software and advancements in end effectors now deliver a return on investment many organizations can’t ignore. Their use for repetitive tasks like case picking and palletizing will also increase.

Robotics-as-a-Service will also see greater adoption, as many warehouses look to deploy robotics either to explore the benefits they offer firsthand, or to address increased throughput needs and defer capital expenditure. This is a development where the learnings from these systems will prompt many to look at more permanent applications that can be optimized within warehouses and distribution centers.

Third, many smaller warehouses will begin their robotics journey with autonomous mobile robots in 2024. While the use of automation is nearly universal in larger operations, and robots are increasingly being embraced as the next logical development, at many smaller facilities the majority of processes are manual. In such settings, autonomous mobile robots, which can be deployed with minimal upgrades and are particularly applicable when the same products are being moved in the same way repeatedly, represent a particularly effective first use case.

These are just some of the reasons 2024 seems to be the year of omnichannel and robotics. As we have seen over the past several years, product mixes, preferred channels, delivery expectations and consumer buying trends will continue to evolve and fluctuate. Even so, reflecting on the past – and building on the lessons learned – is directly applicable to the performance of materials handling operations today and tomorrow.

As an industry, we have learned that change can be fast and dramatic, and that adaptability and flexibility are the hallmarks of success for any fulfillment operations. Materials handling operations designed with an omnichannel approach in mind and that intelligently utilize proven robotics technology reflect these lessons learned.