Amazon Is Using ‘Acquisition’ Of Robotic Companies for Autonomous Growth

Amazon is attempting to scale up with initiatives such as salary hikes, mergers and acquisitions, and partnerships with third parties

Amazon, the eCommerce giant and a warehouse company, is not new to acquiring robotic companies. Starting with the acquisition of Kiva Systems in 2012 for $775 million has come a long way with the recent acquisition of iRobots for a whopping $1.7 billion. And recently it acquired Cloostermans, a Belgian Robotics company, it has been using the services since 2019 for eCommerce operations and scaling up its R&D and deployment operations. "We're thrilled to be joining the Amazon family and extending the impact we can have at a global scale. Amazon has raised the bar for how supply chain technologies can benefit employees and customers, and we're looking forward to being part of the next chapter of this innovation", said Frederik Berckmoes-Joos, CEO of Cloostermans, in a statement for a blog post published by Amazon. Around 200 Cloostermans' employees would join Amazon's workforce. Without disclosing the financial terms of the deal, it revealed that operations for the acquired Belgium-based company will continue from its base, located in Hamme after the deal concludes.

Prima facie, might seem like a normal business merger and acquisition initiative which probably is for very valid reasons, but reports point out that it has been ramping up robotics acquisitions to meet the demands that arise out of its ever-expanding business operations. A leaked internal memo, reported by Recode, warns of severe staff shortage, which may put Amazon's service quality, reputation, and growth plans at risk. Since the last decade, it has been expanding its operations, including in Europe, all while ramping up its hiring initiative all over the world. Experts are of opinion that Amazon's workplace culture which is focused on "customer obsession" – which made Amazon a convenient work model the world has not seen before – is responsible for the surge in expansion and hence the acquisitions.

Cloostermans, going by its antecedents, strikes as a well-established company. Set up in 1884, it was largely a privately run family business held by the last six generations. Given the fact that Amazon is one of Cloostermans' biggest customers, the deal might have gone through seamlessly. Apparently, Amazon is attempting to scale up its operations using a mixed bag of initiatives such as salary hikes, mergers and acquisitions, and partnerships with third parties, which Cloosterman was part of, providing robots for packaging and moving operations. "We have more than 5,20,000 robotic drive units, and have added over a million jobs, worldwide. We have more than a dozen other types of robotic systems in our facilities around the world, including sort centers and air hubs. From the early days of the Kiva acquisition, our vision was never tied to a binary decision of people or technology. Instead, it was about people and technology working safely and harmoniously together to deliver for our customers. That vision remains today", asserts Amazon in one of its blog posts. Clearly, Amazon is turning adversity into an opportunity to not only expand its operations but become self-dependent, and it reflects in its statement to TechCrunch, "We have a vision for a future where people work alongside robotics to further improve safety and the workplace experience" when it acquired Canvas Tech in 2019.