Augmented Reality Solution for Warehousing Industry | AR Startup Ideas


This 1001 startup idea from YoStartups is to develop an Augmented Reality Solution for Warehousing Industry for streamlining the

warehousing process in the e-commerce industry.


Market Definition for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

TMR estimates that the global e-commerce logistics market is expected to surpass US$781 billion by 2024, up from its valuation of US$122.2 billion in 2014. With the growth in e-commerce logistics market, the inefficiencies associated with the industry will also multiply. One of the main problems that are plaguing the logistics and e-commerce industry are mispicks.

The National Retail Federation is projecting losses exceeding $333 million due to shipping mishaps just during the 2017 holiday season. A further $1.5 billion in future revenue loss predicted as a result of consumer abandonment of sellers due to delivery issues.

PCdata USA reports that mispicks will cost individual warehouses $500k annually. A single mispick can cost anywhere between $22-$33 as per Intermec and DC Velocity. PCdata further reported that 52% of the respondents said picking accuracy was less than 97%, 19% did not measure the cost of mispicks, 47% believed that picking is an area where cost savings could be achieved.

Deploying technology-based solutions can improve warehouse efficiencies, one of the widely adopted technology is “Vision Picking” using Augmented Reality based solutions. Smart glasses enable hands-free operation and the technology (WMS, ERP) can push workflows onto the screen and match them with task completion using scanning (barcode) and tracking (3D) technologies.


Competitor Analysis for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry


Picavi GmbH, the first company to have developed order picking using smart glasses. The application uses the camera, scan engine, and microphone only when required and the data are saved temporarily and continuously updated via WLAN. All Picavi solutions are designed to communicate with most of the widely used ERPs and Warehouse Management Systems using standard protocols whose functions are optimized to order picking, goods storage and inventory in the warehouse. They have already finished their first pilot with DHL successfully. Their solution is already compatible with SPA EVM/WM.


iTiZZiMO offers a simple platform called Simplifier which can be customized to accelerate the adoption of mobile and wearable based AR technologies into the existing ERPs and Warehouse Management Systems. Using this platform, one can configure sequentially parallel workflows. The simplifier can also work offline, so there are no interruptions. It has other functions too which can help in shelf management, package tracking, navigation, etc.


Pain Point and Target Audience for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

The annual cost of mispicks for a single large warehouse is estimated to be around $500k. The mispick costs include wasted working hours, reverse logistics cost, blocked inventory, customer aggravation and the loss of goodwill. The potential losses only for reverse logistics (return to sender) can be more than $100 million annually for the entire industry. Retailers and the logistics service providers can use the benefits of advancement in the technology to improve their operating margins boosting their bottom-line.


Value proposition for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

Augmented Reality (AR) with HMD’s (Head Mounted Displays) have shown promising results. A pilot by DHL and Ricoh in the Netherlands delivered a 25% increase in the efficiency as well as positive feedback from the users.

A well designed Augmented reality (AR) app is designed to be compatible with all the existing ERPs. There is no reconstruction or modifications required for including another warehouse infrastructure. Smart glasses mean hands-free operation and all the tasks can be beamed to the heads-up display. Integration of IoT’s can further be done to improve tracking, avoid collisions, elevate safety standards, and much more.


Business Model for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

The proposed startup will follow a subscription-based model with a one-time integration cost with the existing warehouse management systems and data tagging. The hardware cost will be at actuals. The startup can sell two subscriptions of the software, for Enterprises and SMEs based on the number of product scans require per month. The startup can add additional modules like navigation, voice and speech integration for a premium.


Way to Market for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

The proposed startup will have to start with identifying small-scale warehouses for a product refinement and market fitment. Once the warehouses are identified, the startup can approach them for a Pilot project to improve their picking up efficiencies.

Once the pain points are identified, the app can be built and developed on popular AR SDK Kits. With continuous feedback, the app can be refined to work without any glitches with the existing software for warehouse management and the available hardware (Head Mounted Displays). In the next stage, the app can be further customized for compatibility with all the major ERP systems and mobile operating systems.


Milestones for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

1. Identifying prospective customers for the Pilot project and feasibility study- YR1-Q1.

2. App Development, feedback, and refinement with a beta customer- YR1- Q2.

3. App calibration, compatibility with mobile OS and other ERP’s- YR1- Q3

4. Commercial Launch for Enterprise edition – YR1- Q4.


Investment Needed for Prototype of 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

The proposed startup can develop the app on any of the popularly available AR SDK’s which are OS, warehouse software, and device agnostic; and also support widely used wearables like Microsoft HoloLens, Vuzix Blade 3000, Epson Moverio BT-300. The startup can raise between $50k -$120k for developing the App prototype, marketing, and customer validation. Funds can be raised from Popular AR accelerators like BoostVC, Rothenberg Ventures, ViveX, etc.


Team Capability for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry

The team will need a developer who has experience working with popular AR SDK’s like Vuforia or Apple AR Kit etc. which can work with popular RPCs (Remote Procedure Calls) and standard internet protocols. The platform will have to be ERP agnostic to be compatible with all the major warehouse management systems, handheld devices, smartglasses, Popular OS’s like Apple, Android and Windows. The other team members should have experience in IT solution selling to the Logistics or e-commerce industry.


Investors/Expert Take for 1001 Startup Ideas – Augmented Reality Solution for Warehousing Industry


According to Digi-Capital blog, the AR/VR market is poised to reach $108 billion in revenues, with AR contributing almost $83 billion. Microsoft, Apple, Google, and Facebook are heavily investing in AR. There are many appropriate AR software development kit (SDK) already available in the market that can be used to customise AR apps based on the final use cases.

As per a DHL Logistics Trend Radar Report published in 2016, AR will find multiple use cases in the logistics industry in the next five years. We already see safer and smarter driving by using windshields as a heads-up display for navigation and driver assistance to highlight and predict potential road hazards. They can be used to design last mile delivery solutions, where they can locate entrances, optimise the sequence of loading of shipments based on the delivery routes, weight, fragility by overlaying layers of virtual data on the real environment.

In case you are looking at scaling or launching a venture on similar lines, you can apply for our virtual acceleration program Excelrate on our website,, Yostartups’ Excelrate program will help you in streamlining and structuring your startup idea. We have limited scholarships and discount packs for deserving startups, depending on the strength of your application, you may qualify for a discount.

YoStartups is a Pre Accelerator and it empowers entrepreneurs to propel their business ideas into successful ventures. Yostartups’ core mission is to take the message of entrepreneurship to 1 billion people globally by 2020, as on date Yostartups reaches out to over 100 million people globally through its direct and indirect channels.

Jappreet Sethi

*Any information given in the article does not constitute any warranty of marketability or fitness for a particular business idea for any market or industry segment. It is the readers’ sole responsibility to further research and assess the market opportunity.
Hey There!

If you have any question, send us an email and we'll get back to you, soon.

Start typing and press Enter to search