Video Transcript
You're going to be given challenges every day out in warehousing, and warehousing is never going to be perfect no matter what you try to do. And so, just being able to adapt and to learn from the failures and the wins that you acquire through the years is what's going to help. You want to be able to have all the negativity just bounce off of you and just grow from it. Hey, I am here today with Logan Bates, the GM of our Jacksonville facility. We're going to talk about how to run a warehouse really, really well. And, Logan's an excellent warehouse manager. So Logan, first off, how old are you? 26 years old. And, you have how many people reporting to you? About 60, 61, 62. So, that's pretty impressive. So, can you talk us through how you started in this business, and how you got to where you are today running the whole building? So, I started seven years ago. 19, ripe old age- 19 years old- ... of 19- Yes sir. I worked with Rob. Rob helped mentor and develop me and just helped me learn the whole logistics side of it and the Ecommerce side. And then, we got into the fulfillment. He had a couple buddies that he knew through his Masterminds and then we brought them in as clients, and we started fulfilling for them. So, that's it. That's basically you only job you've ever had is running a warehouse with Rob? Yes, sir. Started it with Rob and then we started using ShipHero in 2016. And ever since 2016, we've just been learning the WMS. Yeah. I think you guys were number one. Or, you were, if not the first 3PL within the first three months of us offering 3PL, providing our SaaS product to 3PL, before that was just brands. So, thank you for that, appreciate that. Yes, sir. You guys help us along. So running 60 people, that's a lot. What are the challenges? What's the hardest part about running this building and running the people in this building? The first part of it was the learning side, and that was the personalities. Dealing with different personalities and people from different cultures, you take in a lot, and it's wonderful because you get to meet new people. You get to work with new people. Everyone has a different story, and everyone has a different place where they come from. My favorite was a lot of the people who come in from the foreign countries. We had a couple that came from Cameroon, a couple from the South America- I remember that. French speaking, right? Yes, sir. And so, we like to take on the challenge of learning the different languages and stuff like that. And inside the warehouse, especially in the fulfillments, it's kind of easy. You learn certain aspects, the totes or carts or just everything gets repetitive, but then you start learning it in their language and easier ways to communicate with them. But, I like to take on that challenge. You never know what someone's going through at the end of the day, and they also help you develop as a person as you can help develop them when they come into the United States. Yeah, no, it's super rewarding, and I think you've done a really good job of it in this building. Yeah, so that was the first part was just dealing with the personalities and then came to the workloads. You want to run it lean. You want to be a lean warehouse and so you want to make everything as efficient as you can. And so, early on ShipHero offered that with the many features in the beginning was like bulk shipping, picking. We were picking, before we were using ShipStation, you're picking off a sheet of paper and such. And now, we moved on and we're now using electronic picking. And so, the efficiencies have gotten better. And then as we grew, the ship yard, WMS grew and so we started to be molded by the system itself. Yeah, you guys did a great job of using the process and helping us frankly refine the process of how we build the software to... Because if the software doesn't match the process, we all know it doesn't work. Let's talk some more about what you think about as the GM of the building. So, I'm going to guess it's six letters. C-P-P-S-L-A. Yes. Is that- Yes. Explain what that means. This is the main... The CPP is going to be like your cost for a package. That's going to be your labor divided by the amount of packages we're shipping out. And so, we want to maintain the lowest number that we can while also meeting that SLA. So, there's a perfect merriment between the CPP and the SLA itself. You don't want to make your CPP go so high to where you're missing or you're hitting the SLAs and your CPP go super high. But, you also don't want to miss SLA and then your CPP is super low. And so, you want to try to tie everything in and just have the perfect merriment between the two. And, how does utilizing temps as well as, I know we do a lot of temp to hire in this building. How do you use that to help you hit your SLAs while managing your CPP in a business where we all know it's not flat all year, right? Q4, when we have big customers that have big drops, demand can double or more. So, how do you think about managing your labor in what we all know is a pretty dynamic industry? Yeah, you could never really hit the projected values right on top of the head, but you can always have an educated guess. And so, bringing in the temps gives you that flexibility. Our heaviest days are going into our Mondays and Tuesdays and so that's when you want to bring in, you look for the temp side. You bring them in for a day or two, then you can kind of move on from them as you need them. You can also do the daily temps where you can just bring in temps for a certain day and then you don't have to bring them back again. The daily temps are helpful for during peak season. When you're going into peaks, you want to have that dynamic. So if you have a lot of callouts or someone who is not here or you need more help, like unloading trucks, that's where you'll go into and grab the daily temps. And, I assume daily temps, you're not training them how to pick pack, replan. You're probably giving it more tasks that are less computer oriented, right? What are the tasks you would typically give- Correct- ... to a day temp? So, your day temps are going to be more your manual labor, lifting up the boxes, unloading the truck, moving of the pallets, or even just picking up garbage around the warehouse, boxes, helping the packers out. Basically, where they can help everyone run more efficiently. And then, when you're thinking about how many people you need, I know we run multiple shifts, so what are the shifts we run, and how do you staff those different shifts? So currently, we're running three shifts. Our first shift is going to be a 7:00 to 3:30. That's Monday through Friday. Our second one is going to be a 3:30 to 12:00, Monday through Friday. And then, our third shift is our weekend. Our weekend is now going to four days during peak season, which is going to be a 7:00 to 5:30 shift. And so, is that a 4/10, 4 days a week- It's going to be four days a week. It's going to be Saturday, Sunday, Monday and Tuesday. So, you're going to try to hit the heaviest days of them all. Got it. Yeah, the four tens, if you can make it work, it's always helpful because you get the labor when you need it and then people get that 40 hours. Some people really like the 4/10. So, let's walk a bit, and let's talk about night shift and then how you decide what work happens when dealing with replan, dealing with fixing inventory issues. So, our night shift is going to be a little bit built up with more of our inventory team and our problem solving team. Like I said earlier, the first shift was more based on the outbound. And so, your second shift is going to do more of your cleanup of your SLA orders or anything that is kind of straggling along, need a little bit more extra problem solving as well as getting your replan for the next day. And so, we focus a lot on the inventory in the evening shift. So when we come in the mornings, we're ready to rock and roll and start hitting the orders from the start. So if someone's thinking about scaling up their warehouse, growing their team, when should they think about adding second shift, if they only have one shift right now? I think it's going to come down to where your daily volume is. If you get to a point where your daily volume, it's exceeding your team size, and you're missing a little bit on that SLA. The SLA is what you promised to the clients, and you're making sure that the orders are getting out in a timely manner. And so, if you have stragglers or orders that are still sitting and waiting, coming in the following morning, that's kind of when you want to start looking into that second shift or replan. You don't want slow starts in the morning. You want to come in, you want to rock and roll because that first hour, first hour or two of your shift is what's going to make that shipping day. Right. Okay. And, we probably pay more for weekend or second shift hourly than we do- Correct, yes sir. So, what's the reason we don't just put 20 more people on the day shift at the lower price versus adding a night or a weekend shift? What's the advantage that pays for itself on adding that night and weekend shift? Management. You add X amount of people to a shift, you want to be able to manage them properly. But, you don't want to have to bring in extra managers to dedicate them to running that first shift. And so, when you're doing nights, you do pay a little bit more of a premium, but there's a little bit less going on. And so, you're able to more focus on one or two things. So if you want to focus on the replan, then you can spend that time working on replenishment. You're not really worried about hitting that SLA or getting the orders out the door because the trucks have already left. Right. So it's more focused and more you're not stepping on top of each other. Correct. Replan has a little more time, a little more space when there's not 50 other people in the building? Correct. You can be a little bit more detailed. Basically, you get into the ins and outs of certain items that you wouldn't be able to tackle during the day with all the chaos. And then, this building's about 130,000 square feet. What equipment do we have in terms of forklifts, turret trucks, ePickers? So currently right now, we have a turret truck. We also have a ePicker, which is just a man-up with no pallet behind it or anything like that. And then, we also use a order picker. The order picker is the one where you're going to have the pallet behind you, and it's a man-up system, so you can go up to the higher parts of the racking and grab your items and place it on the pallet with you. The pallet travels with you compared to the ePicker. And then, we also have a counterbalanced forklift. And, which one do you use for replan? Re-plan, currently we're using the ePicker. We also use the order picker. Now, when it comes to our bulk quarters or our bulk items, we will use the turret truck. The turret truck can fit down a 76-inch aisle. Right, okay. Yeah, so it's good for the very narrow aisles. So, when you have a, let's say, a bulk pull and then you also have replan, have wholesale, is there a different operator dedicated to each of those tasks or do you have the same operator gets the different QR codes and has different tasks? This is a wholesale pull. This is a bulk pull. So, we have the same operator. The same operators will do all the tasks, but we also have backup operators just in case we need a little bit more help in that area. But usually, we do run the same operators that just bounce between all the tasks basically. And then, 2023 has been a really good year. What lessons have you learned to help run this building really well? Just being able to adapt and improvise. You're going to be given challenges every day out in warehousing, and warehousing is never going to be perfect no matter what you try to do. And so, just being able to adapt and to learn from the failures and the wins that you acquire through the years is what's going to help. You want to be able to have all the negativity just bounce off of you and just grow from it. Yeah, JB Sauceda says, "We're in the exception handling business," so if you take every issue too personally, you let it bother you too much, take it home with you, it's a really tough business. Because, we're only here to fix problems. If we didn't have problems, we wouldn't need managers. So yeah, it could be a mentally health challenging business sometimes because there's a lot happening with a lot of time pressure and cost pressure. That really makes a lot of sense to me. Let's change gears. What's your favorite feature or favorite part of the ShipHero, WMS? So, I have a couple, well, I think one of the major ones is going to be bulk shipping. Bulk shipping is super profitable and super efficient if you're inside the warehouse. You have a customer that runs the sale, and they're doing a big sale on let's just say phone charges or phone cases, and they have a thousand orders come in. There's a high possibility that those a thousand orders could be all bulk shipped at one time. And so, you have it picked by one person. You can also then use QR code picking for the batches. And so, you go to the location, scan the product, grab it, take it back to the packer and then one person can pack it. The other one would be single item batches. I think single item batches, I think it's a little underrated, but I think it's actually super useful and efficient inside the warehouse. So after you get done with your bulk shipments, you want to run into the single item batches. Your single item batches are going to grab all those onesie, twosies that don't have enough to bulk ship. They have enough for a pecker to go down and actually pick them efficiently and take them straight to the packer. And then once you get to the packer, the packer then has the option if they want to bulk ship just five of those or three of those and then you can move on to the next SKU. Yeah, so little note fact, the only, when we launched ShipHero, it was to have single item batch. Single item batch was the original idea behind ShipHero. So, in the warehouse that Josef and I, Josef, our VP of product, that I had, we had flash sales, so we would sell one deal a day, and we sold martial arts uniform for a martial art called Brazilian Jiu Jitsu. Most people ordered one uniform. So, single item batch allowed us to reduce our pick and pack labor by 40% just by adding that feature and that was the only feature other than single order that we had at launch. A lot of people don't get it. They don't grok why it's useful. But yeah, for me it's bulk and then single, then multi. And, I wish more people would see the value in it. If you track your CPP, you'll see you drive it down a lot by using single item batch and pickers love it because they just fill up a cart. They just grab stuff. It's super fast and rewarding. So, I'm glad you liked that. I'm glad you liked that feature. I'm going to ask you one last question, which is, I think this building is what started the Segway trend. Is that correct? Yeah. Yes sir. Whose crazy idea was it to start whipping around this place on Segways? That would be Rob's idea. That was Rob's idea. Yeah, Rob wanted to be super efficient and like you said earlier, 130,000 square feet, you're paying someone to go to the restroom if they're on the far side of the warehouse. So, it could be a two, three minute walk, four minute walk, and they might see a buddy on the way or a coworker on the way and then stop there. And so, now you're paying for someone for a 15-minute walk in the park. And so, you get on the segway, and there's so much more you can get done. It is a wild idea. There's pros and cons to both sides, but at the end of the day it is super efficient, and it helps us get through the day, especially during peak season. I personally use it. Yeah, I've been 10:00 at night. You got a problem tote, it's all the way in the back in ABE, just jump on a segway, you get there, go grab it. Also, I'm short, it helps you reach the top row. Right. I'm a big fan, but I don't think I would've been the one to initiate using that. So, that's Rob's crazy genius there. All right, really appreciate it. Thank you. Great one. Thank you.
