3 Tech Sectors Crushing the Bear Market
Automation. Robotics. Artificial intelligence (AI).
These three key technologies are poised to do two things:
- Grow in bear markets.
- Rocket higher in bull markets.
Companies are facing challenging market conditions like never before. Issues like inflation, supply chain disruption, increased inventories and labor shortages are all making it harder to do business right now.
That’s why companies need to invest in technologies that boost their operational efficiencies and keep employees productive.
This is where Ian, me and the Winning Investor team come into play.
As Ian always says: Now is the time for companies “to do more with less.”
When companies can’t raise prices to make profits, the next thing to do is to cut costs. They can do this by using the 2.0 technology investments we follow and recommend to you.
Yardeni Research said it best:
Over the long term, “the biggest winners will be companies with economic bases in the U.S. that leverage cost-saving automation to offset higher wages and energy expenses.”
And as reported by Kiplinger’s, a senior U.S. economist at Piper Sandler sees tech like automation, robotics and AI as the start of a productivity revolution for corporations. The economist predicts:
Globalization 2.0 is more of a rightsizing than the end of globalization. Rising interest rates and a threatened recession may slow or pause some reshoring projects. But longer term […] a wide-open field for investors willing to bet on a new productivity boom. Companies are going to find ways to lower their cost structures. We are just at the infancy stages of a productivity revolution.
A productivity revolution led by automation, robotics and AI is what’s on the horizon for industry 2.0, Winning Investor Nation…
2 Companies Going Full-Auto in the Bear Market
Salesforce Inc. just introduced a powerful, new automation and intelligence technology product lineup for its clients to implement.
And according to a press release from last week, Salesforce found that 91% of organizations say they need automation technology.
But only 23% have actually implemented it across their businesses!
As customer expectations continue to rise (especially in this bear market), the need for more automated, intelligent processes will too.
And where fulfillment is concerned, more than 80% of warehouses today lack any type of automation.
That shows us that robots and artificial intelligence have the potential to revolutionize how warehouses work today.
The warehouse automation market presents an opportunity worth nearly $65 billion by 2030, growing from $19 billion in 2021. That’s a significant compound annual growth rate (CAGR) of 14.8% from 2022 to 2030.
It’s a mega trend to watch!
So, as promised in the Mega Trends News segment of our Monday Market Insights video yesterday, here are details on companies today that are now using automation, robotics and AI to stay ahead of the curve in this recessionary environment.
Company #1: The Kroger Company (NYSE: KR)
As one of the world’s largest food retailers, as measured by revenue, Kroger operates over 2,700 supermarket and multi-department stores across 35 states and the District of Columbia.
But get this. In recent weeks, I’ve been receiving fliers announcing an initiative called “Kroger Delivery.”
In my hometown, we do not have any physical Kroger supermarkets.
The main grocery store in my area is Publix.
Yet I’m receiving ads letting me know Kroger is now delivering groceries in my area — without a physical supermarket.
As this CNBC headline put it…
Kroger is spearheading the future of supermarkets by investing in automated customer fulfillment centers (FCs).
These automated FCs are run by more than 1,000 robots.
Years in the marking, Kroger’s FCs are aiming to turn traditional grocery commerce on its head. Its FCs are powered by Ocado Group, a world leader in technology for grocery e-commerce.
In 2018, the two companies announced a partnership to build a delivery network. This venture combines AI, advanced robotics and automation in a “bold new way,” bringing first-of-its-kind technology to the U.S.
As detailed by Kroger:
These bots move around giant 3D grids, orchestrated by proprietary control systems. The grid, known as The Hive, contains totes with products and ready-to-deliver customer orders. As customers’ orders near delivery times, bots retrieve products from The Hive and present them at pick stations for items to be sorted for delivery […]
Kroger’s end-to-end cold solutions keep groceries fresh once loaded into a customized refrigerated delivery van, which can store up to 20 orders. Powerful machine learning algorithms optimize delivery routes, considering factors such as road conditions and optimal fuel efficiency. Vans may travel up to 90 miles with orders from the hub and spoke facilities to make deliveries. Associates at the spoke facility will deliver orders within their service area, adding ZIP codes as demand grows.
Currently operating in Ohio, Florida, Georgia, and Colorado, Kroger is ushering in a new e-commerce productivity revolution.
Company #2: Chewy (NYSE: CHWY)
As mentioned in my latest Mega Trend Thursday video, Chewy is another company embracing the benefits of automation.
As supply chain issues raise input costs, Chewy is taking action. It has several initiatives in place to combat cost inflation for supply chain logistics.
One of those initiatives is automated fulfillment centers.
This time last year, Chewy announced plans to open three additional automated fulfillment centers by the end of 2022. The goal was to improve productivity and reduce the effects of labor shortages.
This past July, Chewy opened its third automated fulfillment center.
According to CEO Sumit Singh:
The fulfillment centers have helped to lower costs while increasing shipping volume.
Nearly 25% of Chewy’s freight volume shipped from its first two automated facilities last quarter, at an approximately 15% lower unit-level cost compared to the company’s legacy network.
The benefits from automation continue to expand across our network and our pace of realizing these benefits continues to accelerate.
This is the future of e-commerce order fulfillment, Winning Investor Nation.
How You Can Crush the Bear Market With the Automation Revolution
Companies like Kroger and Chewy are turning to automation tech. This trend allows them to boost productivity while lowering costs during the bear market, and beyond.
Now, to be part of this automation revolution, consider these next steps:
Buy shares in the ARK Autonomous Technology & Robotics ETF (BATS: ARKQ).
ARKQ is an exchange-traded fund (ETF) that invests in equity securities of companies relevant to the theme of industrial innovation. These companies are expected to focus on the development of new products and services, technological improvements, and advancements in scientific research related to multiple industries.
Check out Ian King’s Strategic Fortunes monthly research service. Ian hand-selects future-forward mega trend investments in industries like automation, robotics and AI.
In this market — while prices are low — you can scoop up shares in innovative companies that can potentially rebound higher when the next bull market begins.
Until next time,
Director of Investment Research, Strategic Fortunes
Disclaimer: We will not track any stocks in Winning Investor Daily. We are just sharing our opinions, not advice. If you want access to the stocks in our model portfolio with tracking, updates and buy/sell guidance, please check out Strategic Fortunes.