PepsiCo Gets In Micro-Fulfillment Game

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PepsiCo Gets In Micro-Fulfillment Game

By Thad Rueter - 11/10/2020

From Progressive Grocer, Nov. 10:

PepsiCo is among the latest companies to join the micro-fulfillment trend.

The Purchase, New York-based company said that it has launched a micro-fulfillment center in Joliet, Illinois. As the fulfillment approach quickly gains ground with retailers, PepsiCo said that it will use this strategic capability to meet the e-commerce demand of its key customers, and to gain important data through working with retail partners to build fully integrated and highly efficient solutions.

This fully automated fulfillment solution also improves COVID-19 safety, reduces the costs of floor space and expedites the picking process, which allows for faster delivery and a reduction on overall delivery costs.

“PepsiCo is one of the first CPG brands to launch an e-commerce micro-fulfillment center, and the creation of this center solidifies our commitment to making the necessary investments to continue to stay ahead of the growing online consumer demand,” said Vince Jones, head of e-commerce at PepsiCo. “Through collaboration with our retail partners, we are creating an end-to-end solution that empowers us collectively to enhance our operations with applied insights. The goal is getting PepsiCo products in consumers’ hands and delivering more smiles as quickly as possible.”

PepsiCo’s solution is powered by Atlanta-based automation supplier Dematic, which was chosen for its broad experience and ability to meet PepsiCo’s world-class standards. Initial tests showed that the high level of automation provided on location allows PepsiCo to service 7.5 times more units an hour than a traditional e-commerce warehouse operation.

“We feel very good about where we are and continue to remain focused on our capabilities and the consumer,” added Jones. “When you look at what we’ve accomplished in the five years since PepsiCo started its e-commerce presence, retailers understand the value we bring in augmenting their operations to deliver great consumer experiences.”

As evidence mounts that many grocery shoppers will stick with e-commerce — online ordering, curbside pickup, home deliveries — after the pandemic subsides, food retailers face the stiff challenge of how to keep up with all of that digital growth and activity. That helps to explain the rising rise of micro-fulfillment centers, which are designed to act as mini distribution centers that enable grocery workers to efficiently and profitably pick online orders without disrupting other store operations.

Earlier in the pandemic, PepsiCo launched a direct-to-consumer site for online shoppers, a reflection of another trend that promises to stay hot into 2021.