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David Maloney, Editorial Director, DC Velocity 0:01
Supply chain companies help their communities cope with the Covid-19 pandemic. Drones are being put to work in the fight against the virus. And distributors get creative in filling the huge demand for online orders. Pull up a chair and join us as the editors of DC Velocity discuss these stories, as well as news and supply chain trends on this week's Logistics Matters podcast. Hi, I'm David Maloney. I'm the editorial director at DC Velocity. Welcome. Logistics Matters is sponsored by Fortna. Fortna partners with the world's leading brands to transform their distribution operations to keep pace with digital disruption and growth objectives. Known worldwide as the distribution experts, Fortna designs and delivers intelligent solutions powered by their proprietary software to optimize fast, accurate, and cost-effective order fulfillment. For more information, visit Fortna.com. As usual, our senior editors Ben Ames and Victoria Kickham will join us to provide their insight into the top stories of this week. But before we get to that, I will turn the floor over to Ben to introduce this week's guest. Ben.
Ben Ames, Senior News Editor, DC Velocity 1:11
Thank you, Dave. Good morning. We have a guest with us, joining us here today, who's Jim Berlin. He's the founder and CEO of Logistics Plus, which is a third-party logistics operator in Erie, Pennsylvania. Jim, thank you for being here.
Jim Berlin, CEO, Logistics+ 1:25
My pleasure, Ben. Thank you.
Ben Ames, Senior News Editor, DC Velocity 1:27
Jim has had a long career in the industry. He's had a 20-year career in the less-than-truckload sector before founding Logistics Plus in 1996 and helping to grow it from just a three-employee operation to having more than $300 million in global sales last year. Jim, we can see you've had some long perspectives on business in the logistics sector, but we're now living through some times that are not quite like any others. I know you just mentioned that you even have some of your back-office computer operators stuffing PPE [personal protective equipment] in the warehouse, there. So there are obviously changes in every part of the business. Could you tell us a little bit more about some of the particular challenges that you've been seeing coming from the coronavirus challenge?
Jim Berlin, CEO, Logistics+ 2:11
Sure, yeah. And you're right, I've been doing this for most of my life, from my days as a truck driver and running an LTL operation to starting this [Logistics Plus] 20 years, 25 years ago. Nothing like this. Not even close. And what we've done--and like, I'm not, I'm not that smart, but I do have a hard head, and we always try to figure things out. So when this thing began, you know, the question is, do you hide or do you kind of figure it out as you go, and we kind of rally the troops to "Let's do something here." And so a lot of our customers were not doing anything, so you can't work for them, but the ones who are still having business would come to us, and we were creative and resourceful in finding solutions for them. And then we found that other customers of our customers, but maybe someone else's customers, were finding they couldn't get the help they needed. So we've had a lot of new people who heard through the grapevine, mostly, that "these guys are moving stuff." So we've actually increased our business with a whole new customer base. Part of which, as you mentioned, is the PPE. We saw that local facilities were having a hard time finding it and getting it. And so we went out there and used our connections around the world, and we're not only able to deliver, but we're able to procure, like almost 10 million pieces already, of masks and hand sanitizers and gloves and things like that. So, it kind of evolved into "Okay, let's figure this out." And I've always said we're a solutions company. And so the solution that western Pennsylvania needed was, "Find us some PPE for frontline providers," and we actually did that in more ways than one.
Ben Ames, Senior News Editor, DC Velocity 3:57
That's really fascinating. We've also seen a number of stories where certain sectors in the industry are seeing sort of winter-shopping peak volumes in what they're trying to handle right now, while others are virtually shuttered. So there's definitely been an effort to move some assets around in order to try to cover that surge in different places, as well.
Jim Berlin, CEO, Logistics+ 4:24
Yeah. What it's done, frankly, is--you know, there's an old quote by John Wooden, the old UCLA basketball coach, and he says "Adversity does not build character, it reveals character." And so, you know, I went from the gang and said, "Look, whatever it takes, let's do this." And so, as you mentioned today, we had a big shipment of PPE stuff come in. It needs to be sorted and palletized and wrapped. So I get the guys and gals from the computers and say, "You're not that busy, because a lot of our normal business is down, so let's run across the street to the warehouse and stuff boxes." And I like that for a number of things. One is, you know, all work is honorable work. So you might be a college graduate working on a computer, but nothing wrong with packing boxes. And it just shows the kind of fortitude and creativity of our group, that no one minds, that they actually like getting their hands dirty once in a while. It's a change of pace for them, too. So it's worked out really well and it's led to a whole new kind of operation for us.
Ben Ames, Senior News Editor, DC Velocity 5:25
That really is inspiring, isn't it? It's that there's a new sense of teamwork that we're seeing, and you see, in applications. Yeah.
Jim Berlin, CEO, Logistics+ 5:32
Teamwork and break down the walls, you know. There's no no walls. Nobody does just one thing here. You do whatever you need to do.
Ben Ames, Senior News Editor, DC Velocity 5:37
That's great advice. Looking forward on that, I wonder if you can pull out your crystal ball a little bit. We're starting to see some restarts, some opening up again, as part--certain regions, anyway, of the U.S. start to roll back some of the sheltering restrictions. Do you think that logistics business will go back to usual after this, or will some of these changes that we've been talking about be likely to stick around.
Jim Berlin, CEO, Logistics+ 6:04
Well, I'm not a good crystal ball guy, and I'm kind of very pessimistic on what this has done to the economy. So I don't know. I don't want to be negative about it. You know, it's starting to come back and we can see volumes picking up. I just don't think everyone will come back. You know, one of our customers is GE aircraft engine, for instance. And I just saw Boeing canceled 500 planes yesterday, so who are you going to build aircraft engines for? So, I think it's gonna be very hit or miss, but I think there'll be a major-- I don't know, "major devastation" might be too strong a word--but something close to that, of a lot of sectors of the U.S. economy. So we'll just have to--you know, you have to evolve, and so we'll find other customers that will survive and thrive, where some customers I think, are not going to be the same for many, many years.
Ben Ames, Senior News Editor, DC Velocity 6:56
Right. Boy, these are fascinating times to live in. In addition to some of those sort of changes in patterns of where your work is taking the assets of Logistics Plus, and some of the walls that are being broken down there, are there new standards that you're currently operating under, just in terms of safety, maybe social distancing and frequent-cleaning kind of things?
Jim Berlin, CEO, Logistics+ 7:21
Yes. From the beginning, we're in Union Station in Erie, Pennsylvania, which is an old, 100,000-square-foot train station, so we have a lot of space here. But from the beginning, we took our compromised employees, told them to work from home, and then we just asked people, like, "If you want to work from here, we'll wear masks. We'll do social distancing. We'll clean the place down, and just be smart and safe. And those who don't feel like coming in can work from home." But honestly, I mean, you can work from home, but it's really not the same. I've done that and I know. So I prefer people here, but we didn't put any pressure. If someone wants to be here, that's great, and you're more involved. And if you're here, you can run across the street to help in the warehouse today. If you're at home, you can't. So it gives you more kind of flexibility to be needed. But we've been very careful about that. And about, of the 140 people in the in the headquarters, between 80 and 100 came in every day, and then others have all come back by now. So we're back to full force and staying busy.
Ben Ames, Senior News Editor, DC Velocity 8:22
Gotcha. Well, that's great to hear. Jim, we really appreciate your joining the podcast today. It's been great to have this conversation
Jim Berlin, CEO, Logistics+ 8:28
It was my pleasure. Thank you, Ben.
Ben Ames, Senior News Editor, DC Velocity 8:30
And we wish you all the best in health and in business going forward here, so... . Dave, we have plenty more to talk about this week. It's been busy on all fronts, hasn't it?
David Maloney, Editorial Director, DC Velocity 8:40
It has been. And thank you, Ben and Jim. We appreciate your insight today. We're going to turn next to Victoria. You reported this week on how drones are playing a greater part in the fight against Covid-19. Can you talk about that?
Victoria Kickham, Senior Editor, DC Velocity 8:53
Absolutely. Yes. And this is in line with what Jim was just talking about in terms of changes in the workplace. It was an interesting study out of a London company called GlobalData. And they're seeing increased interest in the use of drones for a wide range of applications. They're calling it disruptive technology, which drones are. And what we think about in logistics is using those, using drones for delivery. And that's certainly happening. But they're also seeing increased interest in using them for other areas, getting people back to work and things like that. Ensuring social distancing, conducting temperature checks of employees, to make sure everyone's healthy. Using them to spray disinfectants, and for surveillance and monitoring for security issues and things like that. So we're seeing increased interest, and in the industry, we're also seeing some actual applications. UPS and CVS I believe began this month doing delivery, drone delivery, of medicine in Florida, prescriptions. And Ben actually had reported on another situation, I think it was back in March or February. A Chinese company, JD Logistics, was also beginning, or starting to think about, using drones for delivery of medicines and medical supplies. So it'll be an interesting thing to watch for sure.
David Maloney, Editorial Director, DC Velocity 10:08
Yeah, certainly will be. And Ben, you wrote this week about how retailers during Covid-19, during this whole disruption, are distinguishing less between their different inventory streams. Can you explain?
Ben Ames, Senior News Editor, DC Velocity 10:20
Yes, sure thing. And actually, one of the sources for this story, was an executive at JD Logistics as well, as Victoria had just mentioned, with a different story. What he was talking about, he's a man named Bing Fu, who's head of strategy at JD Logistics, which is a large Chinese e-commerce marketplace. And he was talking about how the crisis, the health crisis, has really accelerated some of the changes that people have been seeing coming slowly in the market for some time now. In a word, it's omnichannel. More specifically, I think a lot of us, as private consumers, have seen some changes during the health crisis in the big rise in curbside pickup, for example, even when you just get takeout for dinner from your favorite restaurant. But that's true in a number of stores as well. There's Kroger, which is a large grocery store; Best Buy the electronics retailer; Bed Bath & Beyond--housewares retailer; Container Store, another one. So we see a lot of major names in the industry moving quickly toward something that's been called "Dark Stores," which is, you have the whole building full of employees, full of inventory, but no shoppers allowed in. They bring all the orders to the curb there. And it's one of those things that is certainly being accelerated. We'll have to keep on watching to see if it sticks around.
David Maloney, Editorial Director, DC Velocity 11:39
Yeah, I imagine that we'll have that kind of a setup, I think, within retail stores, for quite some time to come yet, at this point. So it'd be interesting to watch. Ben, we also want to remind listeners of some of our great Covid-19-related resources that we have available on DCVelocity.com. Can you talk a little bit more about that?
Ben Ames, Senior News Editor, DC Velocity 11:58
Yeah, thanks, Dave. We sure do. We have a landing page where we have collected all of our Covid coverage for, it's been eight or nine weeks now. We've been writing an enormous number of stories, so that's a major resource on the site. And then we also have a page that lists all of the specific Covid-related resources that people specifically in the logistics field are offering, whether they're industry groups or vendors or government organizations. So that's a good first stop for anybody who's looking to dig in to find some more details here.
David Maloney, Editorial Director, DC Velocity 12:34
Right. And to learn more, you could go to DCVelocity.com/covid19resources. DCVelocity.com/covid19resources. Thanks to Ben and Victoria for sharing highlights of the news this week.
Ben Ames, Senior News Editor, DC Velocity 12:47
Victoria Kickham, Senior Editor, DC Velocity 12:48
David Maloney, Editorial Director, DC Velocity 12:49
And if you'd like more information on the stories we discussed today on Logistics Matters, be sure to check out DCVelocity.com for more details. And please provide any comments or feedback that you'd like to give us on our new podcast by emailing us at email@example.com. And a reminder that Logistics Matters is sponsored by Fortna. Fortna partners with the world's top brands to transform distribution operations into competitive advantage. Expertise equals distribution strategy, DC operations, micro fulfillment, automation, and intelligent software. Distribution solutions designed today for tomorrow's challenges. Learn more about the distribution experts at Fortna.com. We'll be back next week with another edition of Logistics Matters, when we will discuss how to create a culture of safety within your operations. Until then, have a great week and please stay safe.