COL
Reading through the Coles investor automation day presentation.
I’ve been showing the below picture (in various forms, noting it is slightly hard to see) for a while now, at various quarterly and yearly updates. It shows the material improvement from converting manual distribution centres into largely automated ones, which have a much smaller footprint for a much higher output, a huge productivity gain.
In part, the reason to own business like Coles is because a) everyone’s gotta eat b) there are more people over time c) technological improvements should lower the cost in delivering to points a) and b).
Now, it has taken “kind of” forever. Both Coles and Woolworths have done well at growing sales/square foot, over time, and do have plenty of organisational nous/smarts in setting up stores and supply chains. But the grail of full automation continues to elude them, even as they inch closer.
Amazon have had not dissimilar troubles. The “just walk out” stores have been years behind the original rollout targets (this is where you walk in, grab stuff, and walk out, relying on technology to itemise what you got and bill you accordingly).
Behind the scenes, a huge army of people inspect video footage, trying to categorise/label items that the cameras can see, but not identify, what it is.
All of that is complex, and costly, and whilst you might imagine something like “how hard it is to tell that she/he/they bought 2 bananas”, the answer is that it is harder than you think.
We inch towards greatness, perhaps, over time.
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