AutoStore AS has announced that its fulfillment automation technology, with more than 1,150 systems in operation worldwide, is now available as a pay-per-pick service.
The new offering will enable a lower entry price point to help retailers meet the growing need for more efficient warehouse operations and faster customer delivery, the Nedre Vats, Norway-based company said.
AutoStore, founded in 1996, said it is a technology company that develops automated storage reterival systems to help businesses achieve efficiency gains within the storage and retrieval of goods.
The company offers both hardware and software capabilities, and the AutoStore technology is interoperable with other third-party solutions.
AutStore to work with THG Ingenuity
AutoStore also recently signed a global distribution partnership agreement with THG Ingenuity, part of THG PLC, the direct-to-consumer digital brands group. THG Ingenuity will provide AutoStore technology on a pay-per-pick model embedded alongside Ingenuity’s proprietary warehouse management, courier and optimization software, broadening the addressable market for AutoStore.
The new service model and partnership were announced earlier this week during the company’s fourth quarter 2022 financial results presentation.
“We have seen rising demand for volume-based pricing and more flexible payment terms for customers. Today, more than 80% of warehouses globally have no automation whatsoever. We believe that the pay-per-pick model will further differentiate us and our integrator partners in the market and unlock new demand for order-fulfillment automation,” said Mats Hovland Vikse, CEO at AutoStore.
“AutoStore is already well-known to THG. Thus, we are very excited that THG Ingenuity now has the opportunity to step up as a partner to make the benefits of order-fulfillment automation easily accessible to our growing customer base and potential new markets, across a broad range of categories” said John Gallemore, executive director and chief operating officer at THG.
“We are delighted to welcome THG Ingenuity to further enhance our partner network,” said Vikse.
AutoStore outlines subscription model
The new AutoStore pay-per-pick model is based on an upfront payment for the warehouse grid infrastructure and a recurring subscription fee for robots, ports, and software based on order volume.
The upfront payment for grid infrastructure is expected to be between 20-40 percent of the typical total cost. In addition to making industry-standard AutoStore solutions more accessible to a wider range of potential customers, the technology is easily scalable as a business needs change.
“We look at the pay-per-pick model as a 'win-win-win' solution. As demand curves shift, this alternative pricing model can provide extra protection for customers and the ability to scale up or down with minimal effort. For us, and AutoStore, recurring subscriptions provide increased visibility and predictable revenue,” added Gallemore.
AutoStore has 23 partnership agreements worldwide; THG Ingenuity is the first to be implemented on a pay-per-pick model. The new service model is available to all partners and customers.