Automated Storage and Retrieval System Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Automated Storage and Retrieval System Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The automated storage and retrieval system (ASRS) market is expected to record a CAGR of 11.07% over the forecast period. Automated storage and retrieval systems (ASRS) are computer- and robot-aided systems designed to retrieve or store items in specific locations. The system usually comprises predefined areas where machines can follow established routes to get items. These systems handle different volumes and types of non-palletized inventory at variable speeds to accommodate different throughput demands.

• ASRS is most beneficial in warehouse applications. These systems save ample floor space, which is a crucial factor in warehouse operations. With the evolution of technology, the flow and control of materials have improved. The equipment offers better visualization and the ability to handle variability, variety, and volume at higher speeds, thus generating increased value.
• Artificial intelligence has progressed to the point where a correctly programmed ASRS can alert workers when inventory is about to expire and prioritize shipments on a first-in, first-out basis, preventing spoilage. It is a significant benefit for warehouses that handle cold chain products such as vegetables, dairy, pharmaceuticals, and even machine components where corrosion is a worry.
• As more businesses turn to automation to boost efficiency, lower costs, and stay competitive in the market, they also make the workplace safer for employees. One of the main motivations for the automated storage and retrieval systems market is improving working and safety conditions.
• The need for skilled operators to enable the adequate functioning and maintenance of automated material-handling systems could be a major impediment in emerging countries. However, automated material-handling vendors have been trying to offset this issue by offering periodic maintenance. In addition to high initial costs, the need for skilled workers to perform various activities throughout the vehicles' shelf life is widely considered a major concern in the market studied.
• Post-COVID-19, due to the rising demand for AS/RS products, companies are developing new products or partnering with various end users to capture the market share. For instance, in February 2021, Kardex Holding AG and Autostore AS entered a global partnership agreement. AutoStore is a high-performance, space-saving storage and packing solution that uses autonomous robots to expedite the processing of small parts orders. The technology, which has been utilized effectively in the market for several years, expands Kardex's product and service offerings, particularly in comprehensive order fulfillment solutions.

• The immense growth in the e-commerce industry is a significant growth driver for the market studied. Asia-Pacific emerged as one of the world's largest e-commerce hubs. The region witnessed rapid growth in retail e-commerce due to the rising middle-class population in China, India, and Indonesia and the popularity of mobile gadgets. China accounts for approximately 40% of the world's retail e-commerce sales.
• According to the 47th Statistical Report on China's Internet Development Published in February 2021 by the China Internet Network Information Center, China had the most online buyers and sellers assisted by being the world's most populous nation.
• E-commerce businesses are forming their delivery networks. Flipkart's logistics, referred to as "eKart" in India, is one such example. On the other hand, Logistics companies such as Express Logistics deliver bulk shipments to retailers and distributors.​ Such developments are anticipated to boost the penetration of AS/RS systems.
• According to Google and Temasek Holdings' studies, by 2025, the GMV for the Singaporean e-commerce market is projected to reach USD 5 billion, while the Malaysian and Indonesian markets may reach USD 7 billion and USD 53 billion, respectively. ​
• The e-commerce firms from other regions are acquiring stakes in the Kuwait e-commerce firms to expand their presence in different regions and capture the wide market share.

• The Asia-Pacific region is witnessing an increasing focus on automation by warehousing companies, which is anticipated to drive the automated storage and retrieval systems market. According to IBEF, the grade-A warehousing market has grown steadily in the recent past due to the growth of e-commerce in the country. It is expected to grow at a rate of 15% by 2025.
• China is a significant adopter of Industry 4.0, and the country is home to some of the most advanced manufacturing facilities in the world, ahead of the European Union, the United States, and Japan. For instance, according to the World Economic Forum, of the 69 factories across the world now considered leaders using Industry 4.0 technologies, China is now home to 20, followed by 19 in the European Union, 7 in the United States, and 5 in Japan. Besides being the foundation for plant-wide automation, the automated storage and retrieval system also serves as a foundation for Industry 4.0.
• In Japan, the growth of the automotive industry is expected to drive the studied market. According to JADA, in 2022, Toyota, the leading car manufacturer in Japan, sold around 1.25 million vehicles domestically. Despite a decrease of 12.1% compared to the prior year, Toyota reported more than twice as multiple unit sales as the runner-up. Suzuki, which came in second, sold slightly over 600 thousand vehicles in 2022.
• India has been a prominent contributor to the growth of the ASRS market in the Asia-Pacific region. The increasing demand for ASRS products across industries, such as manufacturing, retail, automotive, and e-commerce, boosts the market's growth.
• The rest of Asia-Pacific comprises South Korea, Thailand, Australia, Indonesia, Singapore, and Malaysia. Indonesia is categorized as an aggressive automation-adopting nation. The country has recorded increased AMH usage for industrial work. Since Japan is both its supplier and consumer, Indonesia is expected to benefit from trade with Japan, thus increasing the demand for automation in the region.

The growing presence of major manufacturers in the automated storage and retrieval sector is expected to intensify competitive rivalry during the forecast period. Market incumbents, such as Daifuku and Schaefer Systems International Pvt Ltd, considerably influence the overall market.

• In December 2022, Daifuku revealed plans to set up a manufacturing facility in Telangana, India, with an investment of INR 450 crore (~USD 54.27 million). The facility is expected to produce intra-logistics equipment such as automated storage and retrieval systems, sorting transfer vehicles, conveyors, and sorters.
• In June 2022, Daifuku announced the reopening of HiniArata Kan, one of the world's largest full-scale material handling and logistics demo centers, located within the company's manufacturing plant, Shiga Works. The center showcases 54 models of material handling systems and equipment, including automated storage and retrieval systems. The center was closed to the public because of the COVID-19 pandemic.

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