About your location – Tessland

Developed Country with active and well-regulated stock exchange.

T$ currency

About the industry - Warehouse Handling

Growing market - projected global revenue for AMRs in 2028 – ~ 8.2b USD (>300% increase from 2022)

Average area of warehouse – 1,500 square metres

>40% of country’s warehouses exceed 9,300 square metres – increased labour costs – efficiency is key

Storage options – impacts capacity

• Wooden pallets – efficient loading and unloading, standard size.

• Shipping containers – need to be loaded onto pallets on arrival.
• Block storage – simplest way to store goods.
• Racking – normal width – 3 metres
• Specialised racking – store pallets several units deep
• Smaller items – stored in cartons on shelving

Warehouse picking – P2G

Pickers move around warehouse to collect goods to combine for orders. Labour intensive.

Can be supported by cobots. Guide picker to location, show goods to be picked and carries goods.

• Individual order pick

• Cluster pick
• Batch pick
• Zone pick

Warehouse picking – G2P/R2G

ASRS – goods collected and delivered to operator to be packed and despatched.

Advantages:

• Faster
• Less likely to drop/damage goods
• Enhanced security
• Reduced risk of injuries
• Fewer errors

Carousels – bring storage bin to picker. Horizontal or vertical.

Robots – more flexible than carousels – can move independently.

• AGVs – lack onboard intelligence. Cannot navigate around obstacles.

 • AMRs – ability to plan route and avoid obstacles.
• Linear route robots – follow path, limited flexibility. Cannot bypass obstacles.
• Barcode-guided robots – navigate flexibly. Use lasers to read labels to identify mapped objects.
• Laser-guided robots – use lasers to determine their position.

Robot coordination

• Centralised – routes controlled by centralised software

• Distributed – robots make own decisions
• Mixed – combination – eg tasks allocated centrally and robots plan paths

Human-robot interactions

• Humans still better than robots at some tasks.

• May need collaboration – so sequencing of tasks needs to be managed.
• Safety needs to be considered.

About your employer – Robobryce

One of world’s largest manufacturers of automated warehouse systems – designs warehouse solutions
on a global basis

Employs 12,000 production staff:

• 7,000 in Darrland
o relatively weak economy, low wage cost but high education standards.
o Produces non-automated and non-autonomous products:
▪ Forklift trucks
▪ Hand trucks
▪ shelving
o Strong demand for these products
▪ smaller warehouses - more efficient to use humans taking instructions from WMS.
▪ larger warehouses – still use traditional shelving for storage.
• 5,000 in Tessland
o Manufactures high precision, autonomous equipment:
▪ Horizontal carousels
▪ Vertical carousels
▪ Mobile robots – AVGs and AMRs (most technologically advanced on the market)

800 business advisers provide consulting support in design and installation and ongoing support of
warehouse systems.

900 R&D staff in Tessland:

• Mechanical engineers – enhance precision and capacity of autonomous products.

• Electrical engineers – increase operating time of battery and reduce charging times.
• Software engineers – adding capabilities and enhancing reliability.
Mission: to pursue the growth of our business in a manner that advances social wellbeing.

Vision: to enhance the efficiency of our customers and, in so doing, to add value to society.

Values:

• To enhance social wellbeing and the quality of life

• To meet stakeholders needs
• To innovate and to be at the forefront of the implementation of new technologies

Corporate Governance: 5 Execs and 4 NEDs. Audit, Risk, Remuneration and Nomination committees

Risk Register:

• Customer demand cyclical and cost conscious

• Long term projects – difficulties associated with this eg, revisions, cost predictions.
• International markets for sales and purchases
• IT risks – reliance on software for operation of autonomous products
• Reliance on technical and management staff

Financial analysis

• Revenues – T$14.9bn
• Revenue growth – T$1bn - 7.5%
• Operating profit – 22%
• Tax expense – 14%
• Dividend pay-out ratio – 22.7%
• Cash reserves – T$167m
• Debt – T$11bn
• Gearing Ratio – 49% (11,000/11,000 + 11,453)
• Share price – T$100 – highs of approx. T$253
• Beta factor – 0.91

Financial Analysis of competitor

• Revenues – T$18.8bn
• Revenue growth – T$1.7bn – 9.9%
• Operating profit – 24%
• Tax expense – 14%
• Dividend pay-out ratio – 21.8%
• Cash reserves – T$928m
• Debt – T$14bn
• Gearing Ratio – 52% (14,000/14,000 + 12,886)
News Stories
Happy Comic – explains 2 ways in which robots can avoid collisions – bump sensors and LIDAR

Tessland Telegraph – Tessland Foods first lights-out warehouse designed and installed by Robobryce.
Does not need any people to operate alongside the automated equipment, reducing costs.

Tessland Telegraph – explains game theory in relation to supermarket price wars.

Tessland Daily – discussion on automation in warehouses changing warehouse work for people.
Reduction in staff needed but remaining work may be more interesting and better paid.
Develop business strategy
I can evaluate strategic options (digital and otherwise) – applying SAF to any new strategic plays/ideas
I can recommend strategic decisions (digital and otherwise) – justifying any strategic options eg
acquisition/merger
I can evaluate potential acquisitions and divestment opportunities – acquire new business or selling part
of business
I can recommend responses to opportunities and threats arising from digital technologies – how to deal
with competitors

Evaluate business ecosystems and business environment

I can select and apply suitable strategic analytical tools – using E3 models eg scenario planning, Big Data,
Mendelow’s Matrix, Portfolio analysis
I can conduct analysis of stakeholder needs and recommend appropriate responses – Who are they? What
do they want? How to deal with them?
I can recommend appropriate responses to changes in the business ecosystem – Suppliers, Developers,
Hardware etc
I can recommend KPIs that encourage sound strategic management - consider aims and values – use
Google…
I can recommend responses to economic, political and currency risks – hedging, lobbying etc

Recommend financing strategies

I can recommend suitable sources of finance – debt v equity mix
I can recommend dividend policy – medium pay-out ratio, listed company, clientele effect
I can recommend and apply business valuation models – listed and unlisted companies, P/E, DVM, Net
Assets, Discounted cashflows

Evaluate and mitigate risk

I can evaluate risks and recommend responses and can maintain the corporate risk register – see sample
provided how reliable is it?
I can identify ethical dilemmas and recommend suitable responses – is an action ethical? What are the
consequences? OPPIC for accountants only
I can evaluate and mitigate cyber risks - access controls, firewalls, patch management, ransomware, trojan
horses, data protection etc
I can recommend internal controls – SOAP SPAM

Recommend and maintain a sound control environment

I can apply internal audit resources - the roles and responsibilities of the IA department eg technology,
environment, financial etc
I can recommend appropriate controls and evaluate the implications of compliance failures – listed
company, legal and CG rules
I can recommend responses to the threats arising from poor governance – threats to reputation, share price,
board positions etc