This Week in Logistics News (September 28 – October 2, 2015)

By Adrian Gonzalez

There was plenty of learning and networking at the CSCMP Annual Conference this week, which I’ll write about in a future post. Dave Clark, SVP Worldwide Operations and Customer Service at Amazon, was the keynote speaker on Tuesday, and during his talk he announced this week’s top supply chain and logistics news story:

Yes, Amazon is taking a page from Uber’s playbook and creating a new delivery network comprised of you and me — i.e., anybody with a car and a desire to earn a few bucks to deliver packages (after undergoing a vetting process, of course). Here are some details from the Amazon Flex website:

Make $18–25/hr delivering packages for Amazon with your car and smartphone. Be your own boss: deliver when you want, as much as you want.

We are looking for drivers who are at least 21 years old and have a car and a valid driver’s license. You will also need an Android phone and will need to pass a background check. We’ll provide access to the app and opportunities to deliver.

You’ll deliver ultra-fast Amazon Prime Now packages. In the future, you may deliver other types of Amazon packages as well.

You can choose any available 2, 4, and 8 hour blocks of time to work the same day, or set availability for up to 12 hours per day for the future. You can work as much or as little as you want.

Amazon Flex is available now in Seattle. It will be available soon in New York, Baltimore, Miami, Dallas, Austin, Chicago, Indianapolis, Atlanta and Portland.

Amazon joins not only Uber, but Deliv, Postmates, and others in creating a new delivery mode and model. The company faces the same questions and challenges as the rest: What happens if a package gets lost, stolen, or damaged, or if a driver gets into an accident while making a delivery, perhaps injuring or killing someone? And will the government view Amazon Flex members as independent contractors or employees?

The answer to the latter question has serious implications for the success of this model, especially in light of the National Labor Relations Board decision in the Browning-Ferris case, related cases involving Uber and FedEx, and even comments made by presidential candidates like Hillary Clinton who a few weeks ago struck a nerve when she stated that “this ‘on demand,’ or so-called ‘gig economy,’ is creating exciting opportunities and unleashing innovation but it’s also raising hard questions about workplace protections and what a good job will look like in the future,” adding that she would “crack down” on bosses who misclassify workers as contractors when they deserve employee status.

Nonetheless, Amazon Flex adds more weight, momentum, and lobbying power to this emerging delivery model, which I believe will ultimately succeed in some form or fashion because we as consumers, in our ongoing quest for instant gratification, will demand it.

There were plenty of announcements this week on the technology front. First, LLamasoft announced that it has closed a $50 million Series B financing round with affiliates of Goldman, Sachs & Co, which will be used “to fund numerous technology development and growth initiatives.” As I wrote a few weeks ago in Supply Chain Design: Growing Scope, Community, and Collaboration, the line between Supply Chain Design and Supply Chain Planning is fading, and I wouldn’t be surprised if LLamasoft uses part of this investment to meld, either via internal development or acquisition, these two solution types into a single platform.

Meanwhile, Cloud Logistics introduced its Same Day TMS program “designed to allow shippers to start shipping – and saving – the day they start the project.” Here are some details from the press release:

Same Day TMS offers the same features that any shipper would expect from a transportation solution. These include freight rating, carrier selection, load tendering and visibility as well as match pay. The solution provides communication with the nearly 1,000 carriers already on the Cloud Logistics network via the Carrier Portal. Additional capabilities, such as mobile, a vendor portal and 3PL billing are also available to the shipper and can be deployed shortly after go-live.

As I commented in the press release, and a few weeks ago in TMS in the SMB Market: The Evolution Toward Software-as-a-Self-Service, this is yet another example of the “Software-as-a-Self-Service” concept I proposed a few years ago, in which a shipper could be up and running with a transportation management system within an hour or two. Hurdles remain in fully getting there — from a technology, onboarding, and go-to-market perspective — but it’s encouraging to see innovation across all those fronts accelerating.

Speaking of transportation solutions for SMB companies, Pitney Bowes announced this week the launch of SendSuite Tracking Online, a new Cloud-based solution “designed to streamline the receiving and tracking process—from inbound to lost parcels–while simultaneously updating parcel recipients and enabling mailrooms to report performance against targets. SendSuite Tracking Online, which is designed for small and medium businesses, is available in 12 countries across North America, Europe and Asia.” Check out this video for a demo.

Also this week, enVista announced the release of a new direct store delivery (DSD) system called Stack Sleeve designed to make beverage delivery faster and easier. According to the press release:

The Stack Sleeve system can be used in the warehouse and during delivery for both route and bulk customers from one vehicle. In addition to the physical sleeves, the Stack Sleeve software application organizes cases to be picked into each sleeve by customer order, directs warehouse personnel to pick multiple sleeves simultaneously, provides printed pick tickets and sequences the loading of sleeves by stop for each route. By optimizing loads within the truck and reducing delivery times, Stack Sleeve can decrease the number of delivery vehicles beverage distributors need by 25 percent or more, reducing transportation costs and related labor requirements.

Check out the website for a demo video. For me, Stack Sleeve is analogous to how Kiva (now Amazon) transformed warehousing operations by linking hardware innovation (robots) with software innovation (the WMS/control system that manages the robots). In this case, enVista also takes an integrated hardware-software approach to improving the DSD process for beverage companies.

Finally, while at the CSCMP conference, I had a chance to see Manhattan Associates’ Mobile Distribution Management application. Per the press release:

By unifying labor, activities, waves and tasks on a single mobile device, warehouse managers and supervisors obtain real-time access to the status of tasks and to employee performance without being confined to their offices. This capability can lead to next-generation productivity gains for both supervisors and employees and can increase warehouse throughput.

Peter Schnorbach at Manhattan Associates walked me through the application on an iPad, and the user interface is intuitive and easy to navigate (it has a look and feel similar to social networking apps). Several large clients are using the application and the response to date has been very positive, especially now that it integrates labor and task management. In short, the days of warehouse workers walking around with clipboards or interfacing with desktop computers are numbered. The future is already here, and it involves mobile devices and applications.

And with that, have a happy weekend!

Song of the Week: “Nemesis” by Shriekback