Josef Mentzer is president and chief executive officer of Knapp, with responsibility for operations in North America and customer service in North and Central America and Argentina. He joined the company in 2003 and served in a number of leadership roles, including chief operating officer, before he was promoted to his current position in 2012. Prior to joining Knapp, Mentzer worked in the automated storage and rack business as well as the design-build construction industry. He recently spoke with DC Velocity Editorial Director David Maloney.
Q: How is Knapp viewing the current state of the supply chain industry?
A: It's an exciting time for us in this industry. We see continued e-commerce growth and demand. A new and growing subset of that is the click-and-collect portion of e-commerce, coupled with a labor scarcity. And with that labor scarcity is the "new collar" job preference.
Q: Can you define what you mean by the new-collar job preference?
A: The traditional warehouse job of driving forklifts and moving boxes around is not really the most desired position for those entering the job market. And what I call "new collar" does not necessarily have to be a technology position, but it has to be a position where you're interacting with technology. People like using their phones and their iPads to get things done. They are used to that.
So, the closer we can design our workstations to work in those ways, the easier it is for our customers to staff those workstations. In any case, between e-commerce and click-and-collect, a labor scarcity, and new-collar jobs—it is just driving demand for highly automated, intelligent order-fulfillment solutions.
Q: How do you feel your company is positioned to address those automation demands?
A: I would say that demand is currently outpacing supply for those types of systems. The click-and-collect component is somewhat unique because these systems are being located in densely populated areas and a lot of times in existing store footprints. Being in existing stores in highly populated areas, you have to use the cube.
Historically, our systems have always been highly automated and intelligent, with high cube utilization and very low order-cycle times. They are flexible and scalable. Those are the attributes of the typical Knapp system deploying in the past decades. The market is definitely moving in our direction, which is why we are seeing extreme growth and success.
Q: As an international company, how are you coping with the upheaval in global markets, including the recent spate of tariffs, Brexit, etc.? Does it change how you go to market?
A: So far, the factors that you mention that are impacting global markets have really not been a factor for Knapp. We are still very strong in each of the markets we serve. We are in China, in South America, and of course, in Europe and here in North America. We are developing and deploying market-appropriate solutions in each of our markets. And all of those solutions will contain some or all of the typical attributes of a standard Knapp system, such as being highly automated and intelligent with high cube utilization. Different markets have different requirements, but those attributes will be in demand in all of the markets.
We have designed our manufacturing supply chains to address tariffs. So, in areas where tariffs have traditionally been an issue, for example in Brazil or China, those are areas where we have set up manufacturing. Because of our current manufacturing base and network, we are in good shape.