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Humans and robots to combine in $27m Saudi fulfilment centre

Starlinks robots Saudi Starlinks
Humans will be assisted by robots at the new Starlinks' new logistics facility in Saudi Arabia
  • Robots to pick and sort stock stored at the Starlinks facility in Damman
  • Logistics provider works with companies including Amazon and eBay
  • Saudi e-commerce revenue rose revenue will rise 12% in 2022

Humans and robots are set to work together at a new SAR100 million ($26.65 million) fulfilment centre in Saudi Arabia.

Logistics and supply chain solutions provider Starlinks has opened the 400,000 sq ft hybrid facility at Agility Logistics Parks in the city of Dammam.

The fulfilment centre is equipped with 254 autonomous robots for picking and sorting, providing storage capacity for over 12 million units. Starlinks said there are also plans to recruit 500 Saudi nationals.

Scheduled to be operational in the second quarter of this year, the company aims to process an average of 3.6 million units per month.

Salah Taha, director of operations at Starlinks, said: “We are committed to driving further innovation in the logistics and supply chain industry in the region and reducing lead time to e-commerce shoppers.”

The company works with Shopify, Magento, WooCommerce, OpenCart, Amazon, eBay, and a further 60 platforms.

City, Urban, Building
Some 254 autonomous robots will pick up and sort at the unit, which has storage capacity for over 12 million units. Picture: Starlinks

Saudi e-commerce revenue rose 12 percent to $10.70 billion in 2022, according to Statista which forecasts the sector will expand by a compound annual growth rate (CAGR) of 16.2 percent from 2022 to 2027 when annual revenues will hit $22.68 billion. 

E-commerce user penetration will soar to 76.4 percent from 61.5 percent over the same period.

An important aspect of Saudi Arabia’s Vision 2030 is to transform the kingdom into one of the world’s leading industrial and logistics hubs.

According to the latest market report from CBRE, average rents for industrial and logistics stock in Dammam in Q4 2022 increased by 6.1 percent.

This compared to a 3.7 percent increase for warehouses in Riyadh, while rents in Jeddah dropped by 9.4 percent from the previous year, and Khobar rents fell 21.1 percent.

A statement from CBRE said: “We expect that the industrial and logistics sector will continue to garner significant interest from both occupiers and investors alike. Subdued levels of supply and burgeoning demand will likely continue to drive performance.”

Growth in Saudi Arabia’s non-oil business activity accelerated in January, having hit a three-month low the previous month, a survey showed, supported by an increase in new orders and output.

The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers’ Index increased to 58.2 in January, from 56.9 in the previous month and well above the 50 mark separating growth from contraction.