"You Can Rent a Robot—for Less Than Paying a Human" (Robots as a Service) RaaS
From Warehouse Automation:
Automation is reaching more companies, imperiling some jobs and changing the nature of others.
POLAR MANUFACTURING has been making metal hinges, locks, and brackets in south Chicago for more than 100 years. Some of the company’s metal presses—hulking great machines that loom over a worker—date from the 1950s. Last year, to meet rising demand amid a shortage of workers, Polar hired its first robot employee.
The robot arm performs a simple, repetitive job: lifting a piece of metal into a press, which then bends the metal into a new shape. And like a person, the robot worker gets paid for the hours it works.
Jose Figueroa, who manages Polar’s production line, says the robot, which is leased from a company called Formic, costs the equivalent of $8 per hour, compared with a minimum wage of $15 per hour for a human employee. Deploying the robot allowed a human worker to do different work, increasing output, Figueroa says.
“Smaller companies sometimes suffer because they can’t
spend the capital to invest in new technology. We’re just struggling to
get by with the minimum wage increase.”
— Jose Figueroa, Manager at Polar Production
"Smaller companies sometimes suffer because they can't spend the capital to invest in new technology,” Figueroa says. “We're just struggling to get by with the minimum wage increase.”
The fact that Polar didn’t need to pay $100,000 upfront to buy the robot, and then spend more money to get it programmed, was crucial. Figueroa says that he’d like to see 25 robots on the line within five years. He doesn’t envisage replacing any of the company’s 70 employees, but says Polar may not need to hire new workers.
Formic buys standard robot arms, and leases them along with its own software. They’re among a small but growing number of robots finding their way into workplaces on a pay-as-you-go basis.
The pandemic has led to shortages of workers across numerous industries, but many smaller firms are reluctant to write big checks for automation.
“Cost declines are great for the diffusion of a technology.”
— ANDREW MCAFEE, PRINCIPLE RESEARCH SCIENTIST, MIT
“Anything that can help reduce labor count or the need for labor is obviously a plus at this particular time,” says Steve Chmura, chief operating officer at Georgia Nut, a confectionery company in Skokie, Illinois, that has been struggling to find employees and also rents robots from Formic.
The robot-as-employee approach could help automation spread into smaller businesses more rapidly by changing the economics. Companies such as Formic see an opportunity to build large businesses by serving many small firms. Many are mining the data they collect to help refine their products and improve customers’ operations....
