Fairprice: Warehouse Automation Will Save Our Customers Money

Singapore grocery chain will build a new S$350-million, 16-story FairPrice Hub that will house the chain’s third distribution center, new headquarters and commercial space including a new FairPrice store and eateries.

Speaking at an announcement ceremony of the new FairPrice Hub in Joo Koon last week, Fairprice grocery stores Chairman Ng Ser Miang told the audience that new automated warehouse operations will create savings from lower labor costs, which can be passed on to consumers through item prices and rebates, and that the supermarket chain will be “the last to increase prices, the first to lower prices”.

To be completed by the end of this year, the S$350-million, 16-story FairPrice Hub will house the chain’s third distribution center, new headquarters and commercial space, including a new FairPrice store and eateries. The distribution centre will boost 52,000 pallets, or wooden boards for holding grocery stock, and double FairPrice’s warehouse storage capacity.

To cope with the tight labor market, an automated storage and retrieval system will replace manual labor in replenishing the warehouses. It will be combined with the Caddy Pick system, which involves autonomous vehicles, mounted on a monorail system, searching for specific warehouse goods at the request of FairPrice stores.

Such a combination, the first of its kind in the Asia-Pacific region, means that 28 percent less manpower is needed, compared to another existing center in Joo Koon. The new center, which will be integrated with Joo Koon MRT Station, will also handle up to 10,000 cartons of groceries per hour, which is 25 percent faster than the current system in other FairPrice warehouses.

Besides manpower and time savings, the FairPrice Hub also received a Building and Construction Authority Green Mark Platinum award for its environmentally-friendly features, such as solar panels, water-efficient fittings and energy-efficient systems.

On whether self-checkout counters at FairPrice stores will put cashiers out of their jobs, Mr Ng said: “We will still be using cashiers. But we also know there is a manpower shortage, even for cashiers, so (self-checkout counters) will definitely help not just to improve productivity, but also to cut down on reliance on labor.”

NTUC Secretary-General and Minister in the Prime Minister’s Office Lim Swee Say, the guest of honor at the ceremony, said that given the labor shortage, Singapore has to pursue innovative breakthroughs to keep its economy growing.

He praised FairPrice for being an active participant of NTUC’s Inclusive Growth Program — which supports automation and process redesign for companies — by raising productivity through self-checkout counters, self-scanning technology, SCAN2GO and automated warehouse technologies in the new hub.

“All these initiatives will add to our competitiveness and, at the same time, lead to productivity gains,” he said.

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