Welcome to Thomas Insights – every day we post the latest news and analysis to keep our readers up to date with what’s happening in the industry. Sign up here to get the day’s top stories straight to your inbox.
Cost reduction has long been a major challenge for manufacturers in the retail industry.
Over the past decade, retailers seeking to optimize their manufacturing costs have resorted to offshoring. Establishing production overseas offers several benefits, including reduced labor and material expenses, tax breaks, shorter supply chains, and access to a workforce. skilled and highly specialized work.
More recently, however, rising foreign labor and material costs, political instability, and unpredictable supply chain disruptions have made offshoring a less attractive option for U.S. organizations. which has led many people to choose to relocate their operations.
Retailers looking to bring production home may need to offset higher US manufacturing costs by moving away from labor-intensive processes and taking advantage of automation and the robotics. Some brands, including Nike, have a head start.
1. Grabit’s Stackit bots
In 2017, Nike partnered with Silicon Valley startup Grabit to increase the speed at which its shoe uppers are produced.
Grabit has developed a new technology using electro-adhesion, which enables gripper robots to grip and work with a multitude of objects and materials. Adoption of robotics in the retail industry has been slow, largely because robots typically struggle to handle and mold softer materials. But Grabit’s technology appears to have overcome that hurdle, with the company saying the robots can grab an egg, a soft cloth or a 50-pound box with equal ease.
This is an important property for a brand like Nike, whose shoes can include 40 different materials in the upper alone. Their assembly requires a precise process of stacking and merging.
Rather than mimicking a human grasping motion, the robot is fitted with electrodes, which produce an electric field that can adhere to most surfaces, allowing the grippers to grasp an object.
Nike has invested in several of Grabit’s $100,000 Stackit robots, which help make between 300 and 600 pairs of shoes over an eight-hour shift. Robots are expensive, but Nike can now produce their shoe uppers in just 50 seconds.
2. Geek+ Smart Bots
In early 2020, Nike announced the arrival of same-day delivery in Japan through a new partnership with smart logistics solutions provider Geek+.
The company’s series of goods-to-person robots serve Nike’s distribution center in Chiba, transporting products to warehouse workers to reduce costs and improve warehousing efficiency. Mark Messina, chief operating officer at Geek+, says the bots have increased Nike’s order picking rate from 100 picks per hour to more than 300.
For some time, brands like Nike have been feeling the pressure of labor shortages in the logistics industry. In a post-COVID world, the growth of e-commerce and concerns about worker safety will further reinforce the need for products like Geek+’s robots that are inexpensive, efficient, and safe.
3. Flyknit 4D knit
Sports brands are constantly striving to make their shoes lighter without compromising the support required by athletes.
In 2012, Nike launched its Flyknit technology, which uses high-strength fibers to create lightweight uppers that fit “like a sock.” As well as being exceptionally lightweight, the material offers breathability and support, and it has a low impact on the environment.
Today, the production of Nike’s Flyknit shoes is highly automated. A CNC knitting machine weaves the upper of the shoe in one piece, which can reduce labor costs by 50% and material usage by 20%. The automated process allows for more frequent shoe updates and improvements, as data is fed back from factories in China to US-based designers and engineers.
4. 3D printing
Nike was an early adopter of additive manufacturing, otherwise known as 3D printing. Technology has spurred product innovation and customization, and it has enabled the brand to produce components that would have been impossible to manufacture using traditional methods.
In 2013, Nike Football unveiled the Vapor Laser Talon, its first shoe equipped with a 3D-printed plate, designed to provide optimal traction on football turf.
More recently, the company has taken advantage of computer design, which allows manufacturers to feed physical parameters and properties into a model to create designs that would be nearly impossible for a human to produce. Nike used this technology to produce their Vaporfly Elite FlyPrint shoe.
In 2018, Nike claimed that its 3D printing prototyping process was 16 times faster than any previous manufacturing method.
Image Credit: pio3 / Shutterstock.com