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(Yonhap Feature) Coupang's fulfillment center gives a glimpse into the future of logistics

14:00 February 07, 2023

DAEGU, Feb. 7 (Yonhap) -- What helped Coupang Inc. to become the e-commerce giant that we know today was its same-day or next-day delivery service called Rocket Delivery.

However, in-between orders and deliveries, there are various types of logistics technology that are utilized to streamline the logistics process and ensure that the right items end up at their intended destination.

"Coupang's accurate and fast Rocket Delivery service is made possible thanks to the logistics infrastructure integrated with robotics technology," Kang Jung-hun, the south region management senior director of Coupang Fulfilment Service Ltd., said during a press tour of Coupang's newest fulfillment center located in Daegu, 237 kilometers south of Seoul. "The Daegu center is the largest fulfillment center in Asia and our test bed for innovative logistics technologies."

The Daegu fulfillment center, opened in March last year, is home to various state-of-the-art technologies developed by Coupang, from driverless forklifts to shelve-moving vehicles and robots that can sort thousands of packages a day. The company spent over 320 billion won (US$253.7 million) to build the facility.

An Automated Guidance Vehicle moves a shelf stocked with inventory at Coupang Inc.'s fulfillment center in Daegu, 237 kilometers south of Seoul, on Feb. 3, 2023. (Yonhap)

On the seventh and ninth floors, shelves filled with inventory are routinely being moved around by more than 1,000 Automated Guidance Vehicles (AGVs). The devices move along bar codes attached to the floor and deliver the products directly to the work station, where workers pick up and organize items in boxes before they are packaged. The AGVs have helped reduce the workload by nearly 65 percent, the company said.

Driverless forklifts roam around the fifth floor and organize mountains of high-volume products, such as tissues and bottled water. The forklifts use QR codes attached to the walls to safely navigate, Coupang said.

On the first floor, hundreds of robots are involved in the final process as they move from the conveyor belt to sort boxes and carry packages. The robots then scan bar codes on the waybill attached to the package and automatically sort them by location, the company said.

At the scene, hundreds of robots move strategically around the floor like chess pieces, while a handful of human workers stand on the other side quietly organizing the packages handed to them by the robots.

Sorting robots deliver packages to boxes at Coupang Inc.'s fulfillment center in Daegu, 237 kilometers south of Seoul, on Feb. 3, 2023. (Yonhap)

Such technologies helped Coupang turn to a profit in the third quarter last year, after continued losses for the past eight years.

In the July-September period of 2022, the e-commerce giant logged a net income of US$90.7 million, marking the first positive figure since 2014. Its founder and CEO Bom Kim has said the company's "continued investment in tech" and "artificial intelligence technologies" helped reduce inventory waste and streamline business processes leading to its first net profit.

Coupang said it plans to gradually apply the technologies used at its Daegu center to other fulfillment center's across the country.

"Our Daegu fulfillment center will act as a test bed and an advanced base to spread our 'high-tech DNA' to other logistics centers," a company official said.



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