Big Retail's R&D Lab Is Your 3PL

Many of the large retailers (think Target) do try-outs with different 3PLs where they demand cutting-edge robotics and software tooling to automate their operations. They basically want the downstream players in the value chain to be their POC (by paying higher prices but not as high as the CAPEX investment they’d need to make if they robotized their warehousing ops) - the industry innovation norm goes downstream in warehousing (from top to bottom of the supply chain) - Target then sees the value (after having exploited cash crunched 3PLs) and starts pulling out the hefty wallet. They then start vertically integrating autonomous systems into each and every one of their owned or operated warehouses - Who gets to win from this? maybe two types of businesses 1. system integrators that the likes of Target need for their autonomous systems to be up and running and be able to at least exchange a few inputs with each other. They are the ones that make sure the warehouse actually delivers at least as much throughput as before (net of the CAPEX costs) 2. maybe, the warehousing-as-a-service businesses that are serving all the SMBs manufacturers and retailers that don’t have deep enough pockets to afford in-house automation