AutoStore announced that it launched a pay-per-pick service option, similar to a robots-as-a-service (RaaS) model, that aims to lower the entry price point of its automated storage and retrieval system (ASRS).
The new payment model will involve an upfront payment from customers for the warehouse grid infrastructure and a recurring subscription fee for robots, ports and software based on order volume. The upfront payment for the infrastructure will be between 20-40% of the typical total cost of the system, according to AutoStore.
“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,” Mats Hovland Vikse, CEO at AutoStore, said in a release.
AutoStore has set up a global distribution partnership agreement with THG Ingenuity, part of THG PLC, a direct-to-consumer digital brands group. THG Ingenuity will be the first to provide AutoStore technology on a pay-per-pick model. AutoStore’s technology will be embedded alongside Ingenuity’s propriety warehouse management, courier and optimization software.
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Of AutoStore’s 23 partnership agreements worldwide, this is the first one to use a pay-per-pick model. This model, however, is now available for all AutoStore partners and customers.
“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,” John Gallemore, Executive Director and Chief Operating Officer at THG said.
AutoStore recently launched Pio, its Product In/Out warehouse automation system, in North America for the first time. The plug-and-play version of AutoStore’s automated storage and retrieval system (ASRS) is tailored for small and medium-sized businesses. When Pio was released, it was available under a pay-per-pick model.
AutoStore was founded in 1996 and is headquartered in Nedre Vats, Norway. It currently operates over 1,000 systems in over 45 countries. The company went public on Euronext’s Oslo Stock Exchange in October 2021. At the time, it was valued at $12.4 billion.