Logistics Management Group News Editor Jeff Berman recently spoke with Marc Gorlin, Founder and CEO of Atlanta-based Roadie, an on-the-way delivery service with the nation’s largest local same-day footprint. This was a continuation of a conversation they had back in March, at the onset of the COVID-19 pandemic. The transcript follows below.
Logistics Management (LM): When we last talked in March when the COVID-19 pandemic first kicked in, you mentioned something along the lines of volume being off the charts. Now roughly eight months later and with things officially into Peak Season, how would you assess the biggest differences between then and now?
Marc Gorlin: There has been an acceleration of existing trends. Online shopping has increased exponentially over the years, and the pandemic has only accelerated that behavior. And for this holiday season there are a few things coming together. One is the higher volumes over the last few months, which are higher than what you would normally see in with peak and continue to be nuts heading into the holidays. The traditional package carriers have put their customers on notice that they will not have as much capacity this year, and prices are going up for the capacity they have. And a lot of big brands are figuring out how they are going to get things to their customers, and same day delivery is starting to look like a pretty good choice. I would expect most shopping to happen online. That is evident as things have not been quiet and increased e-commerce activity has strained parcel systems. Retailers need ways to get stuff to their customers, whether it is more control of the gift shopping experience for same-day or next-day. There is just not going to be the same amount of time and consumers are going to have to get it done earlier. I would predict a pretty big battle for packages for those waiting until the last minute.
LM: What do those things mean for Roadie?
Gorlin: For us, it is good, as we have added 5,000 stores [that Roadie delivers to and works with] over the last year. And, in many, cases these are different retailers we work with that are close to each other geographically. And another key factor is that people are going to be buying more “stuff” this year, in terms of gift giving. You cannot get someone concert tickets or go on a vacation and stuff like that. Those types of things are generally off of the table this year.
LM: With parcel carriers having limited capacity, coupled with seasonal charges and the presence of regional last-mile players and the USPS, how has Roadie positioned itself?
Gorlin: One is the same-day advantage, which we discussed. We can go longer distances and are not stuck to restricted routes like some regional players are. And we are nationwide and not limited to a certain geographic area. We are also built as a crowd sourced model, with an unlimited number of drivers. The other thing is that even with regional carriers and even UPS and FedEx, they need to get all of their stuff in a tractor-trailer to a place to get into their network[s] and do it. These products have typically gone from a DC to these places, and if you are going to get into local markets, you have to get product into local markets, and we do have an expertise in going into stores and becoming a “mini-DC” of the product to get to the end customers. And we are already built and set up and equipped and technically integrated to do so.
LM: Does the concept of inventory replenishment intersecting with retail sales factor in to how you approach business or are you more of a close observer of that?
Gorlin: We are a close observer of that in that we work across a lot of industries and take a wide approach. We work with groceries, pharmacies, automotive and other industries with omnichannel reach. There are a lot of inventory issues, but they are not all out at the same time. Having visibility into where goods are is going to be even more important this year, because it is hard enough to ship it out and you need to know where to send it out to. We are a very close observer of that, because if a driver shows up and a product that someone ordered is not there, that creates a problem for everybody.
LM: With holiday shopping already underway, or imminent, for consumers, what are the biggest lesson learned, or observations, about how thing have changed, from a network planning and operational perspective?
Gorlin: More than ever, people are counting on same-day urgent delivery. A new demographic people are wanting it. Peoples parents that did not previously shop online are now doing it, because they now realize that it might be a better way to shop. Retailers have to have a way to get things to customers, whether it is curbside pickup or same-day delivery. That is one of the hardest parts of the supply chain to solve, we have found. Traditional retail has no idea of how much volume they are going to see this year, projections are all over the place. The other thing is a distributed workforce is a lot stronger, because it can flex up or down and have different sized vehicles and go different [distances]. That is why Roadie has been able to save the day for many retailers, going back to February and March. Customers don’t care about what UPS and FedEx shipping restrictions are and how much available capacity has declined and how much costs have gone up. They just need to figure out how to get an order to where it needs to go.
LM: Looking at Peak Season, do you think there will be some fundamental shifts in how it is viewed going forward because of the pandemic?
Gorlin: I think so, but nobody really knows what to expect for this year. There are those still trying to recover inventories from suppliers. And opposed to April and May, when everyone was getting more essential goods…there was a certain set of goods, like cleaning products, that had a run on it. You can still see in now in stores. The supply chain is still struggling. If you walk into a Costco, you can see that things are not being replenished quickly, in some instances. Plus, for most retailers, peak season is a make it or break it time of the year on top of regular buying. One thing is that retailers are trying to spread the season out. For example, Walmart has had four or five different events they are doing to try and spread the demand out to not have a crazy rush of people at the door and be socially distant. Personally, I think it will work a little, not a lot. We can solve a lot of problems for these retailers get stuff to their customers.
LM: Let’s say that everyone has received the vaccine a year from now and things are more or less back to normal. What do you think things might be like, in that might it ease the crush of e-commerce activity and will some people resume shopping in stores more?
Gorlin: I think it will be a mixed bag. For some people, shopping is like a social activity and that will continue. But I think a lot of people are going to wind up staying at home, too, and you will see that trend accelerate. If you are home with your kids and need to get something at Target or Walmart and can order it on your phone real quick and it then shows up a few hours later and you did not have to spend the time going to the store and back, why wouldn’t you?
LM: How have things changed for Roadie service-wise over the course of the pandemic?
Gorlin: I think things have gotten better in that we have been able to cut a bunch of red tape on the retail side. We can get people up and going fast. And we have a playbook, or manual, that we give to our partners, to help them with things beyond just the delivery but to have operations set up so that things are good all the way through. The smart retailers realize that the drivers are their customers, too, and they are going to take the store to their end customer.
LM: When you started seeing things like peak surcharges and suspended service guarantees by big parcel carriers, due to the pandemic, how did you view those things?
Gorlin: One thing was that it will lead to a strain on the supply chain and impact available capacity. It is hard to build a delivery church for one thing and expect to have to pay for it the rest of the year. Something has to give.
About the Author
Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman