CLDA Magazine - Fall 2016 1 - Page 22

22 F E AT U R E and two-hour deliveries through Amazon Flex. Right now, that means they are giving you more business to meet those needs, but what does the future hold? They are buying their own planes and tractor trail- ers. They think they can do it better and cheaper than you in the future. If they think they can do it, they will do it. Consider how that will impact your value proposition. What will you do in the face of that competi- tion? How will you adapt? What will you offer that they can’t or won’t? Amazon’s concepts aren’t new. Some logistics service providers have eight or ten fulfillment centers and can lower the cost of delivery by being closer to the markets. But here’s the good news for you: retailers are beginning to understand that they have to take drastic action in the face of Amazon’s continue rise. And that they will need to work with last-mile delivery companies to do that. With the help of third-party providers like you, retailers will engage in fulfill- ment- sharing and pooling business models with local delivery. YOU are the key to helping them store and quickly deliver more volume to their local delivery markets. MacKrell: How does a carrier decide whether these and other business opportunities are right for them? Surber: Right now demand exceeds supply in our space and I forecast that trend will continue for the near term. However, not all business is good business for every provider. So, how do you guide yourself? What acts as your compass to ensure you create a mutually beneficial relation- ship with the shipper? It’s taking the time to reflect and create a strategy that’s founded on the motto “Know thyself.” Look, this space is confus- ing by default. The last-mile space acts as a liaison to a variety of trans- portation genres. You need to gain clarity on your core competencies. You’re going to have to understand what niche in this industry is your strength. Review your revenue stream. Break it out by service ver- ticals. What drives your profitabil- ity? What’s next? Where will you grow based upon the results of your review and what the market is telling you? Be absolutely intense and disciplined on direction once defined. Let your strategy guide you. Berluti: I agree with Brian. When I was the CEO of Eastern Connection I knew we had to continually rein- vent ourselves. At one time, we focused our attention on the B-to-B end of our business. But when we looked at revenue per stop, it turned out B-to-C was actu- ally more productive due to the focus on the medical home deliv- ery market segment. For us, that was where the opportunities were. The Affordable Care Act presented us with one of them. The numbers were staggering: 10,000 people per day will be turning 65 for the next 15 years. And the Affordable Care Act is designed to have patients cared for at home. That opportu- nity was right in front of us. We were already doing home delivery of medical products. So we asked ourselves, “What can we do to add value to those deliveries? “ So we began offering to set up the equip- ment and show people how to use it. That business was very good for us. It was recurring and included multiple stops. That “Know Thyself” motto guided us when we looked for ways to grow our business and was the reason we welcomed the acquisition by Dicom. What they brought to the party was expertise and support so that helped us build up our facili- ties to make them into distribution centers. As Brian mentioned, it’s allowed us to offer pool distribution to retailers. You have to know your- self and where you can make money. There’s so much out there and it’s so dynamic that it’s hard to figure out. The acquisition by Dicom also meant a capital infusion to help us grow our footprint. That capital helped us compete in this market place. Their investment helped us bring on the technology to better integrate with the supply chain of customers. Package visibility is what customers expect and that means a tremendous investment in IT resources. What The Dicom Group provided us was that IT backbone and infrastructure. MacKrell: What are the long-term implications for this industry from what Alibaba’s doing? Do you think it will affect the supply chain in this country?: Wilson: The world is a s X[XKB[X\H[K\x&\Hق[ݘ][ۈZ[H\XK\x&\›]Y\[ۈ][XXH\H[[]Z[\[YY\ۙ˂[X^ۈ[\ۙ܈[XXB[YHݙ\\H[^HBXY\\KH[]8&\[\܋B[]H[\[^B]Y ]\]\[[XXx&\œ[[]\Y\ˈ^H[Y[XZ[HX\]XH[X]BH[]\H\]\ˈ]H\X[\X\H\۸&]Y\[\ ^HY&]]HBXH[\X\H]YY]\\XݚY\[\Z\\ˈ^H]HY[^H[^HYܙX]HYKB[[] Y[ۙx&\[œYH]ܝ[]H[YKB[[Z[\\H[HK˂\Z^Y\X[[]\H\X][ۈ[ M