BARA hosted its first virtual roundtable event on 23 July 2020, which brought together several industry professionals and academics from the Food and Drink Federation, BARA Council, Allied Bakeries, University of Lincoln, Schubert UK, James Mae Industries, and Lloyds Banking Group, to discuss whether COVID-19 will drive greater adoption of robot automation in the food sector?
After the initial introduction from the roundtable chair, Gail Hunt (Editor, Machinery Update), followed by the seven panellists, the agenda was split into two segments: the main discussion, and then audience questions. All parties had an opportunity to voice their opinions on a given topic during the 90-minute webinar.
Here is a summary of the key points from the discussion.
Why has the UK food sector generally been slow to adopt robot automation and what have been the barriers?
There is a consensus that food manufacturers operate at high volume, but very low margins; therefore, the capacity for many businesses to invest at scale is limited. Significant capital investment tends to happen when a business is either doing well, and is well-financed, or the business is struggling to break even, so they do not have a choice. At that stage, there is a propensity to invest disproportionally in new technology to radically improve performance.
While the financial model of a business is fundamental to future investment, disruptive intervention; particularly during COVID-19, is a key consideration for new ways of working, as is the perception of what it entails. Likened to big IT investments, senior managers are often of the view that new robotic systems need to be bespoke and they cannot be implemented across an organisation’s multiple locations.
There are technical barriers to overcome when dealing with certain food-types, such as chilled food; they are not always easy to automate due to their short run times and biological complexities. There is also a lack of trained engineers, which the manufacturing industry at large is working hard to address.
However, adopting the right level of robot automation can give you flexibility and boost efficiencies, but you need to design it right from the outset. There are lots of opportunities to use robots for end of line packing applications; you can remove people from performing mundane, repetitive, and heavy lifting tasks, which are better suited for robots. You can then migrate parts of the labour force onto tasks where their skills and attributes can add value, while being able to maintain social distancing during a crisis.
Which sub-sectors within food have already adopted robots successfully, and what benefits have they gained?
The bakery industry is certainly one industry that has, among other FMCG sectors, benefited from greater automation to remove heavy manual handling operations. Perhaps the biggest challenge though is not the product itself, but how it is wrapped, which can change frequently with the latest issue being the new tax on plastic packaging (that does not contain at least 30% recycled plastic).
As the manufacturing and retail industries seek to move away from single use plastic, there is renewed interest in 100% paper packaging. Factory automation needs to be able to adapt to avoid machinery becoming obsolete before its time. This move has become stilted through the onset of COVID-19, whereby single use plastic is preferred for reasons of health and safety, and the need to maximise product shelf-life.
Some sub-sectors are now experiencing a much higher take up of robot automation than 10 years ago; particularly in high-volume, high throughput factories, where the return on investment is much shorter. Customers are also looking for more flexibility to administer shorter batches with quick changeovers. This level of flexibility enables factories to upscale or reduce their production times in keeping with scheduled delivery times. In addition, having the option to auto-adjust the size of your product through vision modules on vision-guided robotic picking makes the process even easier. This simply reinforces the need to design the installation correctly with flexibility in mind.
There is plenty of opportunity for regular pick and place for everyday product-types where the format (of the product) is not really going to change. There are lots of prospective investors in robot technology; however, they expect a return on investment within one to two years, which may of course be achievable in some cases, but certainly not all.
COVID-19 has certainly forced many businesses to think more laterally than they did prior to the lockdown. Also, Brexit, and the new Immigration Bill, which effectively closes the door on the freedom of movement people outside of the UK, is causing labour shortages. If you take agriculture and food processing, for example, UK businesses employ in the region of 100,000 migrant workers; positions that will now need to be filled through alternative means after the transition period ends on 31 December 2020.If you can counter those variances with robots and automation, it could be seen to be an attractive proposition, even to businesses that are financially stretched. It also helps minimise the COVID-19 reproduction rate from which there have been some well-publicised cases in the food supply chain. Moving away from being over-reliant on predominately low paid migrant labour; especially in rural locations, certainly generates some food for thought
There are a lot of UK businesses who still employ people to work cheek by jowl on a production line, which remains a real concern during a global pandemic. This includes sandwich makers and those who work in abattoirs, which can be difficult environments to automate.
While outbreaks of COVID-19 within food factories does little for the industry’s reputation, it is at least helping to highlight some of the issues. When it comes to automation, though, the BARA roundtable panel agreed that the solution is not to go from A to Z and completely “lights outs”. The key to unlocking the future is about embracing robot automation in a considered and phased approach. This largely entails using robots for the everyday, mundane tasks, and humans for tasks that robots are ill-equipped to perform and where humans can add greater value. By adopting this operating model, it can help spread out the workforce, which then starts to address some of the challenges with social distancing.
When it comes to capital funding, the banks have come on a long way since the economic crash in 2008, and not just through tighter regulatory controls. Once considered to be part of the problem, the banks are now hoping to be part of the solution. If you run a business and are experiencing some pushback regarding capital financing or inflexible loan terms from your current provider, look at different providers or brokers. If you are looking to invest in robot automation, your original equipment manufacturer (OEM) supplier may have an additional contact for you to explore potential funding options for new installations.
Whether you are an SME or a larger multinational, consider getting some expert advice: i.e. from robot integrators or the high value manufacturing catapult centres in the UK, such as the Manufacturing Technology Centre (MTC), to gain independent advice and guidance. They can help you plan your project; de-risk it and, if you can present those findings as a part of your business case, assist you to secure the necessary finance.
At things stand, the cost (APR rate) to borrow money has never been so cheap, with interest rates predicted to be lower for longer. Despite this, food and drink manufacturers are plagued by security of contract, with more supermarkets and retailers offering shorter-term contracts than in other sectors, such as automotive and aerospace.
Another consideration is look at acquiring the equipment on a leasehold basis, so you do not start paying for the equipment until it is in your factory earning you money. This removes the need for capital investment.
Which developments are coming through which you think will make implementation of robot automation easier / more cost-effective?
Schubert has, for example, developed a Light-Line range of equipment. It uses the same Schubert technology; the same robot control systems, but it is a pre-configured machine. Therefore, you can have a pickerline with an integrated flow-wrapper, a cartoner, or case packer; the advantage being the costs are about 30% cheaper than the standard range of equipment from Schubert. Due to its compact configuration, the Light-Line series does come with some nominal scope limitations; however, the lead time on delivery is a lot quicker and the equipment is ready to plug in and switch on.
In addition to the development of digital twins for advanced fast picking robotic systems, another big game-changer is the greater adoption of 3D machine vision technology; in particular, neural networking, which combines artificial intelligence (AI); otherwise known as machine learning or deep learning. If you combine neural networking with new 3D vision cameras, the image processing speed is far superior to your typical classic machine vision, which will have a positive impact on high speed dynamic pick and place systems.
In all cases, it is important to consider the cost of ownership, as well as the cost of purchase; be it financing or capital investment. i.e. How much does it cost to install the equipment, and how much is it going to cost to run and maintain the equipment?
Do we expect a significant increase in the adoption of robot automation soon, and what assistance does the food sector need to achieve this?
Economic downturn is often the stimulus to innovation and new ways of working. If you cast your mind back to the financial crash of 2008, which was a different economic crisis to COVID-19, it was the catalyst for change. For robot density to increase in the UK, it requires the sponsorship of someone senior in the business to get better acquainted with robot automation, to have a significant stake in the success of the project, from inception through to completion. This can, however, prove challenging given the lifecycle of many senior stakeholders; particularly in the top 30 food businesses in the UK.
Therefore, while robot automation is commonplace in some industry sectors, investing in industrial robot technology is a big cultural shift for many organisations. It can be incredibly appealing and key to business success, but there are some barriers to overcome.
The automotive industry learned a long time ago that automation is best delivered in easy to manage bite-sized chunks, and to automate the things that are easier to automate first, before moving onto the more challenging aspects later. It is not about all or nothing, it is about managing the process as well as expectation.
There is a call for the UK Government to place more emphasis on investing in new robot technology; whether it be access to grant funding or tax concessions. When compared to other nations, the UK needs to make “big bets”, especially at a time when it is willing to the splash the cash to get people back to work and get the economy moving again. Investing in new technology should be part of the Government’s recovery plan.
Audience question (summarised): How flexible are automation suppliers? Do they offer initiatives where, like some machinery suppliers, you can pay for every time the machine wraps something, without the need to buy the machine?
A good starting point is to talk to your OEMs to ascertain a realistic payback time. Depreciation is an important consideration; however, if you have very good productivity, then you can always write it off over five years. By this time, if the market moves on, your business will not be saddled with a very expensive asset on the books.
It has not been easy to apply financial leasing to robot automation equipment. This is principally due to the equipment’s residual value at the end of the term. When it comes to asset-based finance leasing for robot automation equipment, options are very limited, but more financial providers are aware of the need for it.
It is quite possible that suppliers of industrial robots will eventually provide a cost per usage contract, much in the same way that Rolls Royce charges a unit cost for flight operators per mile. The same can be applied for packaging machinery, where you are not necessarily paying for the machinery, but each time a consumable passes through it.
Audience question: do you think that the harmonised standards for robots’ safety help or hinder the uptake of robotics?
Safety is paramount, and while elements of the ISO 10218 standard are frustrating due to some areas of inflexibility and practical ergonomics, the international standard will inevitably develop over time to ensure that it is fit for purpose within a practical working environment. This may include relaxing some of the guard heights and safe distance zones.
Audience question: what do you think will be the focus for automation and robotics innovation in the future; will sustainability and hygiene be paramount considerations?
Environmental factors are not a big driver, it is more about productivity and reducing cost. Flexibility of design is key though to ensure it meets a wide range of uses.
If you would like more information from the event, or explore how robotics and automation could work for your business, please contact BARA at firstname.lastname@example.org. A member of the BARA Council or PPMA team will be on hand to respond to your enquiry.