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From Startup to Success: Warehouse Management Strategies | Warehouse OS Series Ep 03

Have you ever wondered what it takes to grow a business and achieve entrepreneurial success?

You’re in luck! In this exclusive video, we talk to Aaron Rubin, founder and CEO of ShipHero, and Randall Guernsey, head of our Salt Lake City warehouse operations.

Get essential insights from our experts on maximizing your warehouse operation systems for success and take your business to the next level! Don’t miss out – watch now!

Video Transcript
- Doing what we do is nothing magical, right? Anybody can take a product, put it in a box, and give it to a carrier. It's really about the relationship that you build with those customers and being able to follow through with what you say you're going to do. (mellow jazz music) - We've known each other for many years. You were a customer, then we went through a process, acquired your business, and now we work together to make sure that this building, where we are today in Salt Lake City is a world class fulfillment center for our eCommerce clients, right? - Absolutely. - So first of all, thank you for the journey together. So talk to me about how you got started in this business and what that journey's been like for you. You have an interesting story. - Yeah, it's been quite a roller coaster to say the least, that my journey started back in 2004, 2005. My brother actually started his own fulfillment company focusing specifically on eCommerce order fulfillment, which again, at that time, Amazon was still a bookstore and eBay was really the, you can actually buy stuff online and have it shipped to you, so there wasn't a whole lot of pick-and-pack competition at the time. And that's really kind of where I got my roots started. And through the course of that business, it ended up getting acquired, and that's what gave me the motivation to start my own business, which became Golden Egg Solutions which I started in 2016. Again, with the focus on eCommerce, small parcel, direct-to-consumer pick-and-pack services. But I also wanted to be a little bit more omnichannel to focus on B2B replenishments. You know, Amazon FBA, hazmat products, wholesale order fulfillment as well, to try and bring all of those services consolidated under one roof. And it just quickly grew, quickly blossomed, but not to say it didn't come without its own share of roadblocks and headaches to try and overcome throughout the process. - Yeah, but you did go from startup to pretty successful, grew pretty quickly, sold a business, you know, pretty short amount of time. So, and I know a lot of people, they wanna achieve that, right? They're starting their 3PL today, or they started it a couple years ago and they're they're trying to grow to that level. What was it that allowed you to acquire customers and grow so quickly when you started? - If I were to narrow it down, I would really say it had to be the attention to detail and the customer service approach. Because really doing what we do is nothing magical, right? Anybody can take a product, put it in a box, and give it to a carrier. It's really about the relationship that you build with those customers and being able to follow through with what you say you're going to do. The communication is a huge portion of that, because when you are starting a small business and when we're bringing on new customers, oftentimes that client, that is their livelihood. That's how they pay their bills. That's how they put food on their table, that they don't want to just feel like another number in the books to a bigger company. They wanted to feel like this vendor, this provider actually has their best interest and their best benefits in mind. And that's kind of the way that I approached my business and grew it with kind of a white-gloved, so to speak, customer-centric approach to it. - Yeah, and Golden Egg always had a great customer reputation. And I know you had good success like the nutraceuticals category. And from what I remember, maybe there was some word of mouth there also where you served one person and it's an industry, right? - Yeah. - People talk and then they're like, "Hey, who are you using? Oh, I'm not too happy." "Oh, well my guy's actually pretty good. Let me just give you Randall's cell phone." And some clients come from there, right? - Yeah, so that's part of where my brother's company had a lot of success in, was in the affiliate marketing industry, specifically related to health and wellness and nutraceuticals. So finding our foothold in that industry early on was very critical to that success of being able to build a early reputation, a strong reputation of being a solid service provider within that industry. And yeah, if you do good with one client, then word does get around that, "Hey, who's your guy that you use for this services?" And you know, luckily I was that guy. - Right, yeah, no, reputation's everything, right? And you had a great reputation. Let's talk about what technology you used. So when you started start with ShipStation, right? How long were you there? What was that journey like? - Oh, it was a struggle. So, you know, just for lack of options and ease of use, you know, ShipStation is a great platform to be able to print a label. But that's really the extent of it. And when you're starting a small business, that's really, you know, kind of the main focus is just getting product out the door. There really isn't a big attention to detail on inventory, slotting, the accuracy of when it comes in. But as I continued to grow my business, those problems became very real that a lot of feedback and pressure from our clients of wanting more visibility, an actual customer portal to be able to log into to submit order requests, to run inventory reports, to run general reports, just didn't exist within the ShipStation platform. So through my own journey of looking at different WMS software and different systems that's fortunately where I stumbled across ShipHero and it was absolutely a game changer, you know. From the first demo that I had on the system compared to other big providers that were already available, just the function and ease of use, you know, the learning curve was next to none because it did have a lot of that same user interface, at least, you know, from a aesthetic standpoint that made it very simple to navigate the system and implement it in real time. And being able to roll that out to our customers was very quick, very painless, and nothing but positive feedback from that point. - That's great. So how many employees were you when you decided, "Hey, I need to get a WMS?" - There was only four of us at that point. - Four, wow, okay, so it was early to switch. - Very early on. I think it was within the first year and a half of starting up Golden Egg is when we started to experience the limitations with ShipStation. - And was part of that you thinking like, "Hey, this this business is growing, I'm four now but I'm gonna be eight, I'm gonna be 16, I'm gonna be 32. I need a game plan, I need to get ahead of this." - A lot of it was actually based on the ability to segment client profiles and have an easier integration with their store profiles. Fortunately, you know, the scalability from a user standpoint kind of came with the package, but that's really what was driving that decision was making sure that there's the segregation of inventory, portal logins from a client standpoint, and making sure that we did the process differently from picking orders to actually packing. Because, you know, ShipStation doesn't provide that same type of visibility. It's just a paper pick ticket, which then comes up to the employee's memory of where product is slotted, versus having the system actually tell you to go to a specific location to pull an order. - Okay, so today you're running a nice-sized building with a good number of customers and a lot of volume. What's your favorite ShipHero feature? - My favorite feature is probably the newest one that we've been using, which is the WorkforceHero feature. Just from a labor standpoint and a supervision standpoint, it gives you so much visibility into what is happening on the workforce floor without having to be involved with everything myself. I can simply pull up the dashboard and I can see exactly which employees are clocked into which specific task, how long they've been there, whether or not they're idle in it, and it gives us that much more power to focus our labor efforts into tasks that really need the attention. - Yeah, I know sometimes easy to check that when you're not even in the building, right? - Yeah. - Just like gives you a little, like, what's going on there? - Exactly. - Yeah - Exactly, so from a management standpoint, that is absolutely a game-changing feature. - So let's talk about people. So we track SLA and CPP, right? We have to hit our service level agreements to our clients and we wanna do that at lowest cost per package. This building excels at that. Last several weeks been top of the charts, consistent high performers. So that mostly comes down to, it's people and process, right? - Absolutely. - So let's talk about the people side. Good team. Team's been here for a while. Leadership's been here for a while. What do you attribute the success of building and and maintaining that team here? - A lot of it does come down to the culture and the environment that we try and facilitate here within the building. Treating people the way that they want to be treated, giving them opportunities for advancement and, you know, hearing their feedback, actually listening to their concerns and trying to implement changes where we can, where everybody benefits. And that's kind of what has really spearheaded the retention that we have with our employees. And a lot of them came to us with zero experience, with not the best backgrounds. And now some of those are the ones that are supervising and leading the teams, which has really kind of solidified that culture that we do care about everybody, that we try and give everybody an opportunity to succeed, to grow within their own professional career. And it, it shows with the team that we have and their dedication and commitment to working hard. - Yeah, and I've seen that firsthand. Some leaders here who you gave 'em a second shot, right? Maybe some other businesses wouldn't have taken a shot at them or given 'em a shot to succeed, and they came from, they're just picking and packing through now managing all the pickers and packers, right? - Yep. - So I've seen that, and they're super happy. Like you could see there's some people where it's like, "All right, they believed in me, they gave me the opportunity, they treat me with respect, and I'm gonna bust my ass for the company." And you guys kick ass at that. Talk to me about Tyler. How'd you hire him and and why did you? And Tyler's one filming this, right? - So that's easily hands down my best hire that I've made to date. But it was very conscious, the decision. You know, when I was looking to grow the company, I was doing it very strategically by building a solid foundation. And really the only way to do that in a startup company is to document and solidify process. Because otherwise, like, everything has to come from up here. And then it's a peer-to-peer training program. And that's what I really wanted to pull myself out of was working in my business to be able to work on my business. And in order to do that, I needed somebody with operational experience, you know, a good head on their shoulders, that was willing to take a chance on a young and growing company to document process and procedure, train people on that, roll it out, and then start measuring and tracking the success of that to ensure that we're still moving forward in the right direction. And you know, fortunately Tyler was one of those people that applied to it. And you know, funny enough, I almost didn't hire him because he blew me off for that first interview from his previous job that he wasn't able to make it. But, you know, my big heart gave him a second chance. - There you go, you're Mr. Second Chance. And now Tyler does that same role nationwide. So it worked out. - Yeah, absolutely. - It worked out for Tyler. - Good job, Tyler. - It was a good thing he showed up for the second interview. So if there was someone here, I know you help a lot of other business owners, but let's just, for the people that are watching it, who don't have the opportunity to talk to you one-on-one, someone who's a new 3PL owner, just starting, just scaling, what advice would you give 'em? - Focus on the process, you know. Stick to the basics and don't worry about trying to grow too quickly. That is definitely the thing that I've found is, again, once you can hold your end of the agreement and follow through with what you say you're going to do, the reputation builds itself and word of mouth starts getting around. That a lot of business owners, I feel, kind of get lost in the weeds of either continuously working in their business and don't focus enough time on building a solid foundation and a solid process that bigger, larger clients can actually have a stable base to grow from. - Yeah, I mean I think the one thing I would, well, I've learned from watching you run this business is you didn't pick like, "Oh, I'm gonna take this one thing and it's gonna be this super sexy, flashy thing." You just like, step by step just built it with just solid, no, you know, I mean it's like Covid, which was a little crazy, but you know, no 100% growth years, no hiring a ton of salespeople, none of that. Just like every year, just a little bit better, a little bit better, fill up the building, make sure you have good customers that are happy, they stick around, and it's a successful business, right? - Absolutely. - Not overnight, but pretty quickly, right? - Yeah. And that's I think where having culture, the people behind it, having the process for those people to manage the process rather than managing the workload is all key to success. And then once you add in the technology piece of that, a system like ShipHero on top of that foundation of processes and people that operate it, I mean, that really is kind of the secret sauce, if I ever were to say one, is people, process and systems. - And what I love about when we talk to the people here, shift supervisors, managers here about a process change, they all understand it and they all have critical feedback. So they clearly understand the value of process and also feel like they have a respected voice. 'Cause they're coming back with like, well, what about this situation? What about that? How do we handle it in a productive way? Just making sure. So I think you've been able to instill in the team the value of them thinking through process, not just, "Okay, I do what I'm told." Right? It's more like, "I understand what I'm gonna do." So clearly you've you've explained it to them multiple times, they understand it, and when there's a change, they understand the framework of how the business is gonna run, and could say, they sort of hang this change on that framework and say, "Okay, yeah, this makes sense. I get it, but here's some concerns, here's some challenges." Which is a rarity, I think. In a lot of buildings there's a little bit too much, you know, pushing down of like, "Hey, here's what we're doing." - Yeah. - And it's the same thing that you are doing. It's just maybe you're just bringing 'em along in the process a little bit more, and then it makes them super, instead of fighting the change, it's sort of like, "All right, how do I understand it? How do I make it better? What does that affect me? How's my job gonna be different? What am I looking for on day one when we implement it?" Which makes everyone win. So yeah, I'm always impressed with the team here and how they understand process. - Yeah. - Thank you. Appreciate the conversation. - Absolutely.
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