By relocating capacities to low-wage countries, companies from western industrialized countries were able to reduce their costs without compromising on the quality of their products. This concept was so successful that Western consumers are now offered significantly fewer products that originate from domestic production. Even before COVID, there were calls from politicians, particularly audible in the USA, to move jobs back.

Due to the disruption to supply chains caused by the pandemic, the topic then also found its way into companies outside of the political arena, as stock shortages are not good for business - an argument for bringing production, warehousing, packaging and distribution closer to the consumer again. Nearshoring increases the resilience of the supply chain, and this factor is more important to many companies today than the cost argument.

Robotics supports nearshoring

Automation reduces the cost gap between countries with higher and lower labor costs. Countries with lower labor costs initially have a competitive advantage in low-skilled, labor-intensive manufacturing and logistics activities. Due to the lower labor costs, companies can reduce their costs by relocating to these countries and thus increase their competitiveness. However, the more companies take this route, the faster the demand for labor grows, which means that labor costs also rise there. If, independently of this, robotics becomes ever more efficient and cheaper, many companies will have a real alternative: home-shoring logistics and automating logistics processes here on site to escape the labor shortage - in terms of costs, it makes no difference whether a robot is running in China or Germany. However, because shortened supply chains are less prone to disruption, it can make sense to relocate logistics.

Of course, qualified specialists are required for the use of robotic solutions, but there are far fewer of them than for manual work in warehousing and fulfillment. An automation solution also reduces the need for logistics space, which is becoming increasingly expensive not only in this country. Shelving systems can be closer together and goods can be stacked higher. The reduced need for space leads to cost savings and therefore a clear competitive advantage, especially in Germany, where logistics space is expensive.

With a robotics solution, companies can not only save costs, but also better protect themselves against inflation. Compared to offshoring, nearshoring no longer seems prohibitively expensive due to the many advantages, and there is also the benefit of the local supply chain. Robotics can accelerate nearshoring and vice versa. The higher a company's margins and the more skilled its workforce, the more likely nearshoring is to be an option for them - unlike companies with lower margins and less skilled employees.

Rental solutions without initial capital requirements

The initial investment costs for introducing a robotics solution are one of the obstacles that sometimes stand in the way of automation. Users also need to employ a team that is familiar with the hardware and software. Large companies are the pioneers. They can benefit from economies of scale and employ a team of specialists. Medium-sized companies, on the other hand, do not have comparable resources or teams, so the introduction of automation is slower for them.

But there are ways to avoid the high initial capital costs. A new type of service company offers rental solutions that are comparable to SaaS (Software as a Service). They offer turnkey robotics solutions according to the RaaS (Robotics as a Service) model based on flexible subscriptions. Getting started with automation is often the biggest hurdle for companies. However, once this barrier has been overcome, the benefits develop in no time at all. Perhaps robotics is the forerunner of a new industrial revolution.