Sortation Systems Industry Overview
|Study Period:||2018 - 2028|
|Fastest Growing Market:||Asia Pacific|
|Largest Market:||North America|
*Disclaimer: Major Players sorted in no particular order
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Sortation Systems Market Analysis
The Sortation Systems market was valued at USD 5291.2 million in 2020 and is expected to reach USD 6886.7 million by 2026 and grow at a CAGR of 4.47% over the forecast period (2021-2026). The pandemic has demonstrated the need for terminals and ports to respond to dramatic changes in global logistics patterns immediately and the robustness of automated solutions compared to traditional crewed operations. Further, in the post-COVID world, terminals are adapting to the changing business landscape and leading to a highly rapid acceleration of remote capabilities and digitalization of operations. Operators are increasingly deploying terminal automation solutions that are anticipated to evolve to become more standardized, easier to deploy, and replicable from one installation to another.
- With the rapid growth in stock-keeping units (SKUs), wholesalers and distributors find it hard to make informed decisions about their operations. This drives the need for the more innovative use of labor, equipment, and technology.
- Additionally, the increasing number of available products and demand for more frequent and smaller deliveries in the current competitive landscape automates distribution operations. It can immediately increase an organization's order accuracy by half a percent up to several percentage points.
- Moreover, the adoption of Internet of Things (IoT) technology covers market growth during the forecast period. The players in the market are focusing on utilizing the technology to enhance their product offering and meet the various requirements of different end-users. Further, sortation plays a vital role in pharmaceutical companies. These companies face wastage issues because their products that are sorted outside their storage temperature range for a long time are rendered unusable. To overcome this challenge, market players utilize IoT connectivity and provide sortation at high speed and better visibility related to the product's location.
- High initial investments in the manufacturing of these systems adversely affect the growth of the automated sortation systems market. Moreover, the players need to manufacture systems that meet the standards set by various regulatory bodies. This limits the development of market players. However, with the growing tourism, these products at airport facilities for sorting luggage are expected to drive market growth over the next few years.
- Further, increasing investments in warehouse automation in various sectors are expected to boost the market over the forecast period. For instance, Coca-Cola European Partners announced an investment worth USD 49.6 million in its automated warehouse at its factory in the U.K. The investment was made to increase the facility's storage capacity and have systems automatically moving around 25,000 pallets.
Sortation Systems Industry Segments
A sortation system(hardware) merges, identifies, inducts, separates, and conveys products to specific destinations. Conveyors and sortation systems allow more efficient retail, wholesale, and manufacturing distribution and are used across industries, such as post and parcels, airports, food and beverages, retail, and pharmaceuticals. These end-user applications have been considered to arrive at the market estimates. Moreover, the country-level analysis for each of these end-user industries has been covered in the report. Further, the scope of the study considers the impact of COVID-19 in the market.
|By End-user Industry|
|Post and Parcel|
|Food and Beverages|
Sortation Systems Market Trends
This section covers the major market trends shaping the Sortation Systems Market according to our research experts:
Retail Industry is Expected to Hold Significant Market Share
- The retail market is one of the largest in the world. It has a high presence of omnichannel vendors that stand to be one of the largest consumers of material handling solutions, such as sorting systems. The demand for sorting systems is exceptionally high from the e-commerce establishments that require high throughput operations in their fulfillment centers.
- Moreover, the growth of the market in India is complemented by the adoption of industrial automation systems with various companies offering different solutions and is characterized by recent developments. For instance, Delta Electronics provides a wide range of automation products and solutions, including robot solutions for warehouses.
- The convergence of flagship programs, such as Skill India and Digital India, is the key to achieving this goal, thereby driving the country's market growth. In December 2020, Skill Ministry and Tata launched the first batch of the Indian Institute of Skills. Such programs are rolled out in India to develop Factory Automation and Sorting System skills and create greater awareness amongst the general public and business organizations.
- Some players invest in developing sorting systems due to the sudden increase in demand during the coronavirus pandemic. For instance, in July 2020, Next Generation Manufacturing Canada (Ngen) invested USD 5 million in projects leading to the development and production of automation technologies instead of manually to help stop coronavirus spread.
- Moreover, GreyOrange has launched its latest modular sortation system, designed for modern distribution and logistics centers serving retail, courier, and express companies. Additionally, the Flexo robotics system can handle up to 12,000 parcels per hour, sorting up to hundreds of destinations, including standard post and courier items up to 15 kgs (33 pounds).
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North America Accounts For the Largest Market Share
- Automating warehouse and order fulfillment operations has become the primary strategy to ensure supply chain productivity and financial goals while maximizing customer service levels in North America. Additionally, the United States is contributing around 91% of the revenue share in the sortation systems market in North America.
- By automating distribution operations, organizations across North America increase order accuracy ranging from half a percent up to several percentage points. Businesses that automate realize a significant reduction in operational costs and a measurable increase in service levels, which have an immediate impact on overall profitability and a long-term positive effect on the market share growth.
- Moreover, increasing interest in sustainability, coupled with a robust economy resulting from cost containment, has led to the demand for the sortation systems in the US. In the United States, post offices have seen a 60% energy savings in parcel handling applications after employing a roller sortation system across their parcel handling module.
- The region's strong economy, with substantial port traffic, increased e-commerce activity, and critical manufacturing indices resulting in manufacturing growth are poised to drive the country's demand for a sortation system. These scenarios, coupled with the high adoption rate of Industry 4.0 across industries, are expected to create considerable demand across the region over the forecast period.
- Further, in July 2021, MHS, a single-source material handling automation and software solutions provider, has launched a dedicated robotics division spun off from its research and development organization. Known as MHS Robotics, the group develops advanced technologies in-house and nurtures external relationships to deliver market-ready robotics solutions for e-commerce and parcel logistics facilities.
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Sortation Systems Market Competitor Analysis
The Sortation Systems Market is fragmented and highly competitive. Product launches, high expense on research and development, partnerships and acquisitions, etc., are the prime growth strategies adopted by the companies to sustain the intense competition. Some of the recent developments in the market are -
- June 2021 - Satake has announced a debut of its latest and largest optical sorter in size and capacity: "NIRAMI series." Satake's latest high specification Optical Sorter "NIRAMI" is designed to efficiently sort grains, pulses, seeds, and many other products. With various sizes available, all featuring extra-wide chutes and flexible configurations, Nirami ideally suits a wide variety of applications and processing capacities. These newly designed optics detect and distinguish subtle color differences utilizing RGB full-color cameras and optional infrared (IR) cameras.
- March 2021 - Interroll has added a system for a wide range of potential users to its successful range of automated sortation solutions with the launch of a new drop tray sorter, the Split Tray Sorter MT015S. The new product makes it easier for companies to enter the e-commerce market or be used flexibly to existing sortation solutions.
Sortation Systems Market Top Players
Daifuku Co. Ltd
Interroll Holding AG
Viastore Systems Gmbh
Bastian Solutions Inc.
*Disclaimer: Major Players sorted in no particular order
Sortation Systems Market Recent Developments
- October 2020 - Amazon announced USD 100 million logistics investment in opening new automated sorting system warehouses in Mexico, including its first shipping centers outside the populous capital area, to offer faster deliveries. The new sites include two fulfillment centers, one near the northern city of Monterrey and another near the central city of Guadalajara.
- March 2020 - BEUMER Group presented a new compact cross-belt sorter named BG Sorter Compact CB, which is more flexible with a tight footprint. This newly developed system from the sortation and distribution technology range optimizes performance and product life-cycle costs. This is ensured by the intelligent software and the possibility of data analysis. The sorter is easy to integrate and operates with low energy consumption and high precision.
Sortation Systems Market Report - Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Market Drivers
4.2.1 Increasing Demand for Improving Order Accuracy and SKU Proliferation
4.2.2 Increasing Concerns about Labor Costs
4.3 Market Challenges
4.3.1 Need for Skilled Workforce
4.4 Industry Attractiveness - Porter's Five Forces Analysis
4.4.1 Bargaining Power of Suppliers
4.4.2 Bargaining Power of Buyers
4.4.3 Threat of New Entrants
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
4.5 Industry Value Chain Analysis
4.6 Assessment Of COVID-19 Impact On The Industry
5. MARKET SEGMENTATION
5.1 By End-user Industry
5.1.1 Post and Parcel
5.1.3 Food and Beverages
5.2 By Geography
5.2.1 North America
220.127.116.11 United States
18.104.22.168 United Kingdom
22.214.171.124 Rest of Europe
5.2.3 Asia Pacific
126.96.36.199 Rest of Asia Pacific
5.2.4 Latin America
188.8.131.52 Rest of Latin America
5.2.5 Middle East and Africa
184.108.40.206 South Africa
220.127.116.11 Saudi Arabia
18.104.22.168 Rest of Middle East and Africa
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Company Profiles
6.1.1 Daifuku Co. Ltd
6.1.2 Interroll Holding AG
6.1.3 Dematic Corp.
6.1.4 Viastore Systems Gmbh
6.1.5 Bastian Solutions Inc.
6.1.6 Murata Machinery Ltd
6.1.7 Honeywell Intelligrated
6.1.8 Beumer Group Gmbh
6.1.9 KNAPP AG
6.1.10 Vanderlande Industries Nederland BV
6.1.11 Siemens AG
7. INVESTMENT ANALYSIS
8. FUTURE OF THE MARKET
Sortation Systems Market Research FAQs
What is the study period of this market?
The Sortation Systems Market is studied from 2018 - 2028.
What is the growth rate of Sortation Systems Market?
The Sortation Systems Market is growing at a CAGR of 4.47% over the next 5 years.
Which region has highest growth rate in Sortation Systems Market?
Asia Pacific is growing at the highest CAGR over 2018 - 2028.
Which region has largest share in Sortation Systems Market?
North America holds highest share in 2021.
Who are the key players in Sortation Systems Market?
Daifuku Co. Ltd, Interroll Holding AG, Viastore Systems Gmbh, Bastian Solutions Inc., Dematic Corp. are the major companies operating in Sortation Systems Market.
Sortation Systems Industry Reports
In-depth industry statistics and market share insights of the Sortation Systems sector for 2020, 2021, and 2022. The Sortation Systems research report provides a comprehensive outlook of the market size and an industry growth forecast for 2023 to 2028. Available to download is a free sample file of the Sortation Systems report PDF.