Supermarket jobs still safe despite automation agenda, says Woolworths boss

Woolworths chief executive Brad Banducci has pledged that supermarket jobs won’t suffer at the hands of automation, even as the grocery giant looks to inject more technolggy into its online delivery operations.

The $48 billion retailer has pressed go on the first of its automated ‘micro-fulfilment’ centres located in the Victorian suburb of Carrum Downs, which it hopes will play a major role in turbocharging its online services in the face of a COVID-induced boom.

Woolworths' new micro fulfilment centre in Carrum Downs.
Woolworths’ new micro fulfilment centre in Carrum Downs.

The new site, designed by Boston-based Takeoff Technologies, is far smaller than standard distribution centres at just 2400 square metres, and are placed either alongside or in the back docks of supermarkets.

Up to 10,000 products can be packed into the small-format sites, which use robots to pick products off shelves and ferry them to human workers, who sort them into orders intended for online deliveries.

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Despite the industry-wide push into automation, Mr Banducci said he expected his supermarkets and their supply chains would employ more people in ten years than they do now.

“I think our business will have more people in it than it does now,” he said. “Where they work and what they do will change, and that’s just the way the world is.”

“We’d love to provide a bit more service in our stores, a bit more meal inspiration…we’re not lacking things we want to do, but we have to find very smart ways to do them given the nature of the world we live in.”

“It will change the shape of the business, no question.”

Earlier this year, Woolworths announced as many as 1350 workers at three of its New South Wales distribution centres could be made redundant due to the company replacing the warehouses with two automated ones.

The new Carrum Downs site will create 150 jobs in the region, and Mr Banducci said the company was also gearing up for a big hiring spree ahead of a bigger-than-expected Christmas rush.

Woolworths CEO Brad Banducci has said supermarkets will have more employees, rather than less, in a decade.
Woolworths CEO Brad Banducci has said supermarkets will have more employees, rather than less, in a decade.Credit:Louise Kennerley

Woolworths and other supermarkets had previously warned supply chains could suffer during Christmas thanks to Victoria’s lockdown measures, but Mr Banducci said he was no longer concerned about supply in the state after productive conversations with the state government.

“It has been a very collaborative process, so I would say we’re not in a bad place,” he said.

The new Carrum Downs warehouse is one of four – two in Australia and two in New Zealand – Woolworths is rolling out as trials, with the objective of taking the strain off the company’s online division.

Woolworths has not divulged the costs of the trial sites and Mr Banducci labelled them a “strategic initiative” rather than a capital one. However, he indicated more sites could be on the way given the supermarket’s dire need for better online systems.

“We’ll wait and see how many we have, but picking e-commerce orders will always take place in our existing fleet and we need to make it as efficient as possible [with] additional capacity given customer demand for home delivery,” he said.

The Carrum Downs site was constructed alongside the existing supermarket, however, Woolworths’ preference is to shrink the floor space of larger stores in order to fit the centres within existing store footprints.

Woolworths and its rival Coles have both experienced massive online growth over the past 12 months at the hands of the COVID-19 pandemic, and both are focusing their efforts on expanding the nascent channel.

While Woolworths has opted for the micro-fulfilment model, Coles has partnered with UK tech company Ocado to build two centralised automated fulfilment centres at the cost of $150 million.

Woolworths is also focusing on automating its larger-format centres, with Mr Banducci saying automation was “critically important” for large warehouses to ensure the supermarket could continue growing its business.

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Source: Thanks smh.com