AMA with GEODIS: COVID-19, Carrier Networks, Customer Experience and How Retailers Can Adapt in 2021
Let’s start with you telling us about what GEODIS does and your role there.
GEODIS is a fourth-party logistics provider, which means that we handle end-to-end supply chain management. We provide over a century of experience and proven expertise in five lines of business — supply chain optimization, freight forwarding, contract logistics, distribution, and express and road transport — so there’s no mode of transport that our business doesn’t touch.
I’ve been in my role as vice president of solutions and growth since May of 2020, and have been focused on helping brands optimize last-mile delivery and develop new solutions to meet the challenges of the COVID-19 pandemic and beyond.
How does GEODIS | City Delivery play a part in a diversified carrier network?
GEODIS City Delivery offers retailers access to a network of local drivers — whether employees, independent couriers, or gig-company contractors — who can deliver or pick up goods. Using our network, clients can get their products closer to consumers and achieve faster delivery times, optimizing the last-mile experience and enabling same-day fulfillment.
To enhance the City Delivery offering, this year we launched GEODIS Zipline, which gives retailers granular visibility into delivery status, down to photos of customer signatures collected when they receive their packages. Using City Delivery and GEODIS Zipline, retailers gain unprecedented flexibility and control over the delivery experience — enabling them to meet customers’ rising expectations.
With the pandemic lingering into peak season, can you talk about the role stores played with your clients?
Even though fewer people are browsing stores and shopping centers, we’ve seen stores play a pivotal role in 2020. Many retail clients already offered buy online, pickup in-store (BOPIS); when COVID hit, they focused on meeting increased demand by streamlining and speeding operations and expanding to offer curbside pickup. To handle the dramatic surge in online orders, we also saw retailers pivot to fulfill orders for delivery from stores. Our City Delivery service can pick up items from stores with inventory for same-day delivery.
City Delivery not only speeds fulfillment; it also helps keep stores running smoothly. Packages intended for home delivery don’t clutter stock rooms. Associates can dedicate fewer hours to preparing shipments and get back to serving in-store customers. City Delivery can shift all that activity out of the store environment to an offsite hub, where orders can be sorted for local delivery or onward transport.
We also saw pickup lockers and kiosks begin to take off. These options are contactless and convenient, and I’ve seen shoppers use them and get in and out of the store within a minute. Amazon has a network of lockers already, Walmart has self-serve pickup kiosks, and Kohl’s and Lowe’s are rolling out similar services. We’re looking forward to exploring how to use these services in tandem with deliveries to speed fulfillment, for example with drivers sweeping lockers hourly for pickup of orders they then carry from the store to the customer.
What changes spurred by the pandemic will stick around once the pandemic is gone?
A year ago, most retailers fulfilled online orders from distribution centers and warehouses, and relied primarily on one or two major carriers for delivery. Those days are gone for good. That old model was not really prepared to accommodate the pandemic, not to mention the peak season spike coming on top of the ongoing surge in online ordering.
Now retailers are examining how they can diversify carriers so they’re not in the position again of running out of options. GEODIS has always offered that diversity; we have a robust partner network and 156 locations in the U.S. alone where we can route packages. With that kind of system in place, we can bypass the parcel carrier network and be not just multi-modal, but smarter about how to get packages to customers. We’re seeing clients interested in establishing for the long term the flexibility and agility our system can offer
2021 is going to be the year of convenience. We predict continuing uncertainties over store shopping will drive the need to meet customers wherever they’re comfortable buying — and to win and retain business, companies need to make customers feel special, even in this challenging environment. End to end delivery services can help with that; you’re not just handing off to a carrier and losing hold of the customer experience, but you can manage it all the way through to delivery.
Of course, the challenge comes with meeting these customer expectations while also managing costs. I’ve been in the industry for 35 years, and have never seen fees skyrocket like they have. Given the circumstances, it’s understandable, but those costs may well be here to stay, with peak surcharges staying in effect and COVID surcharges also still in play. Plus there are general rate increases that go into effect in January. Brands need as many alternatives as possible.
Part of that equation will be managing customer expectations. I like to say there’s no such thing as free shipping; someone has to pay for that cost somehow, and that cost is going through the roof, which collides with customer expectations for the customer experience, and the resulting perception of brand value. One bad delivery experience can completely implode a retailer’s reputation, thanks to social media and word of mouth.
So on the one hand, you have brands willing to subsidize costs of delivery to a degree, in recognition of the fact that delivery is a crucial part of the customer experience. But we’re also seeing a growing willingness on the part of customers to pay for same-day delivery and for flexibility. The new message is that delivery may not always be free, but you have more options than ever. The expectation may be changing toward quicker and more convenient delivery, versus it’s always free. Or at the very least, customers acknowledge that “free” has a different meaning now, in that it’s not by default free for every type of service.
At Convey, we share the view with GEODIS that delivery is the “customer experience” of the logistics world. How are you helping your clients create better delivery experiences for their customers?
Brands are investing more than ever in the customer experience, through heightened online and mobile experiences and customer service that includes AI-powered chatbots. But then they hand off orders to carriers and their control and visibility drops off. We’re helping change that.
We have luxury clients who are realizing that if you sell a thousand-dollar pair of shoes, and you just hand off that purchase for delivery, what does that say to customers? It’s a lost opportunity for the brand to build their reputation for service. In the same vein, GEODIS City Delivery uses malls for fulfillment services where trained professionals go to stores, secure items, and use an in-mall distribution center where packages are staged and prepared for delivery using a courier network.
Another alliance partner, Toshi, offers a try-before-you-buy and accessorizing service, with goods delivered by an associate who can help with selection, returns, exchanges for new sizes, and even alterations. They’re highly trained professionals. We can customize what the delivery journey looks like based on what the company needs.
Our City Delivery couriers are local shipping heroes. They’re accountable to us, and retailers can monitor and direct the experience. Using the GEODIS Zipline application we can ping courier locations every 30 seconds and SMS message the customers if they want to know exactly when their package is going to arrive. That level of transparency isn’t reliable with a simple handoff to a gig company driver.
Post holiday and as peak season carries over into 2021 – what learnings can you share from this new normal?
A clear set of priorities has emerged. For starters, companies that committed to single-source carrier contracts to win volume discounts should now, obviously, rethink those agreements so they can diversify and gain the agility they need. As they expand, retailers need to know their partners and their capabilities; in general, they should take a second look at contracts to see what gaps exist and prepare to mitigate those risks.
On an organization-wide level, retailers are realizing more than ever just how important their technology is. They need better inventory management and visibility, and they need to be able to leverage their technology to get there. If they’re following the industry and the vendors, companies can identify the pieces of the puzzle they need. They don’t have to reinvent the wheel, but they do have to know what’s available and how it can integrate with their existing systems. At the end of the day, if the technology doesn’t help connect inventory and packages and forecast for labor needs, there’s a lot that can go wrong.
What about returns management? What are some ways retailers can better manage this using a last mile partner?
There’s huge potential to reverse-engineer last-mile services to accept returns. For example, our City Delivery drivers can not only collect returns directly from customers, but they could sweep retail stores regularly to collect returned items, whether from a dedicated service desk or from lockers, then transport them to local processing hubs and either refurbish them for resale or transport them onwards for recycling or disposal.
What advice would you give logistics leaders heading into 2021?
While 2020 brought unprecedented challenges, it’s an exciting time to be in logistics. We’ve made tremendous strides in offering new alternatives for customized and convenient delivery experiences, so companies should take heart. They can tap into the change and innovation that is happening, and find smart new ways to put the available delivery infrastructure to work to build their brands.