0:05

Welcome to the Productivity Podcast . This

0:08

is the second in our mini series

0:10

with our friends at Strongpoint and delighted

0:12

that Tim Wheeler is back to join

0:14

us . Hi Tim , hi Simon , nice

0:16

to talk to you again , and you and you

0:18

. So we kind of talked

0:20

around eFulfillman Automation

0:23

, dealt a bit deep into

0:25

grocery , talked about all sorts

0:27

of AMRs if I remember

0:29

the terminology and humanoids . Today

0:33

we're going to have a bit of chat and get a bit deeper into

0:35

the last mile , because I think

0:37

there's lots of talk , isn't there in this

0:39

area of retail

0:43

and distribution around how labour

0:45

intensive it is . There's always an

0:47

environmental angle rightly so on everything

0:49

that happens as well . So

0:51

for those that maybe

0:53

aren't sure what the last mile means

0:55

, do you want to give us a synopsis

0:57

or Tim's view of the world ?

1:00

Yeah , it can do , and I think it's

1:02

fairly simple . When a

1:05

person makes an online

1:07

order , the

1:09

product has to get to them , and it can get

1:12

to them in a couple of different ways . It

1:14

can be delivered to their doorstep in

1:16

their home or they can go somewhere to pick it up

1:19

. That's the last mile . Why is it the last mile ? Well

1:21

, fulfillment in eCommerce

1:23

usually finishes at a storefront . If

1:27

you've done picking in store

1:29

, it can finish at the front of a warehouse . If

1:31

you do your eCommerce fulfillment in a warehouse , it

1:33

can be either . Or if you have

1:35

a fulfillment network , but somehow

1:38

that order has to get to where

1:40

the customer is expecting to pick it up .

1:44

So if we're not walking in , as in going for a

1:46

browse and paying through the till and walking out with it

1:48

, it's when we've pre-purchased

1:50

, somebody's picked it , got it and then it has

1:52

to get to us via DHL , whatever

1:56

it might be at this moment in time .

1:58

Correct and I think for the UK in particular

2:00

, that's a pretty good synopsis , because the

2:02

UK is very much a

2:04

home delivery market and

2:07

when people think of the last

2:09

mile in the UK , home delivery

2:11

is where their mind will go . But

2:14

actually , if you look at other markets around

2:17

the world , and particularly the

2:19

home market of strong point our head offices

2:21

in the Nordic region if

2:23

you look at the last mile in the Nordic region

2:25

as an example , instead of being

2:27

highly dominated by

2:30

home delivery , it's actually got

2:32

a very substantial locker

2:34

based market , and

2:36

what that means is , instead of the product

2:38

being delivered to each and every

2:41

person's home , the

2:43

products are delivered to central

2:45

points within the fulfillment network lockers

2:47

lockers that are

2:50

able to keep the product at the right

2:52

temperature , obviously , the right safety

2:55

, and that the consumer

2:57

can come and pick up their order from

3:00

their preferred point when

3:02

they want . And now , obviously , as

3:04

well as home delivery as well as locker pickup

3:06

, there's the traditional clicking collect

3:08

. I buy something online

3:11

and I go to the store itself in

3:14

order to pick it up and I think clicking

3:16

collect always exists . It

3:18

has positives for companies and has negatives

3:20

for companies , but that last mile

3:22

is going to be a combination of

3:24

store pickup , home delivery

3:27

and increasingly this sort of intermediate

3:30

locker pickup option , and

3:32

that's almost the let's meet you halfway kind

3:35

of option .

3:36

See , I like that and I suppose on

3:38

the clicking collect front we do lots of measurement on clicking

3:40

collect for organizations . It's

3:42

a real challenge for them because the times are

3:45

really varied and it's inevitably a frustration

3:47

for a customer if you've got to wait while somebody

3:49

goes and finds a parcel or

3:51

doesn't find a parcel . Inevitably

3:53

, and in some occasions , that

3:57

stores just weren't laid out

3:59

for the volume and breadth

4:01

of product that they're now servicing . Right

4:04

, and I think any retailer

4:07

supermarket hasn't

4:09

got and probably wouldn't want to have

4:12

to refit every store to carve

4:14

off that space that's now needed . So it it

4:17

, as you say , is a necessity and will always

4:19

be there . But if you think of DIY

4:21

stores , for example , they sell anything

4:23

from Tinder paint , screws

4:25

and nails to whole bathroom suites , sheds

4:28

, so that slabs . That breadth is

4:30

huge . So I

4:33

think that's interesting Lockers I've

4:35

seen lots and lots in the UK spring or

4:37

pat service stations

4:39

, petrol stations , supermarkets , but

4:42

more the other way of I'll go

4:44

and drop my return off there or

4:46

my eBay parcel , rather

4:50

than me going to the locker

4:52

to collect my shopping , to collect

4:54

my whatever it might be . Does that make sense ?

4:57

You're right , it's a lot less prevalent here

5:00

in the UK than other countries and it's always

5:02

, in a way , it's

5:04

confused me because when you hear

5:06

retailers in the Nordic

5:09

region , for example , talk about their locker

5:11

channel , they are absolutely

5:14

glowing about this channel

5:16

and you think it barely

5:18

exists in the UK

5:20

as an outward channel . I mean

5:22

, you know , you see the odd Amazon lock around

5:24

the place , for sure , but you don't . People don't pick

5:26

up their groceries at

5:29

lockers . So much in the UK

5:31

. And it doesn't make sense when you think about

5:33

it , because the retailers in the Nordic

5:35

region they say the things

5:38

that everyone knows , which

5:40

is that lockers save

5:42

an enormous amount of cost

5:45

in the home delivery aspect

5:47

. So , instead of a retailer delivering to

5:49

you know every single household

5:51

that's ordering a product , they're delivering

5:53

only to certain chosen

5:56

bulk pick up

5:58

points . So there's a huge saving

6:00

in the van fleet

6:02

that you're using , in the labor

6:05

that you're using to drive

6:07

to people's homes . That's

6:09

the part that everyone knows . Everyone knows

6:12

that there are huge cost

6:14

savings if you can do something

6:16

about home delivery . The piece that

6:19

I think not everyone knows and understands

6:21

unless you talk to one of these Nordic retailers

6:24

, is that there's a significant

6:27

portion of the online customer

6:29

base that prefers that

6:31

. There's a presumption , I think

6:33

, in the UK market that the consumer wants home delivery

6:36

. It's the most convenient thing for

6:38

the consumer and I'm now convinced

6:41

that that's actually a wrong assumption

6:43

. And what the Nordic retailers

6:45

will say is that some people will

6:47

prefer , you know , give me an hour window

6:49

and I'll hang around the house and the

6:52

van will come , hopefully , in that hour window

6:55

. You know , maybe a bit either side

6:57

and I don't mind , but there's

6:59

a significant number of customers you say I

7:02

don't want to have

7:04

to sit in my house listening for the doorbell

7:06

for even a one

7:08

hour time slot . I

7:11

want to get my product exactly

7:13

when I want to get my product . And actually I'm

7:15

a part of this market because

7:18

when I , you know , buy , you

7:20

know , a book or something from Amazon , let's say , I

7:22

choose the locker option . And

7:24

why do I do that ? Because I control

7:27

exactly when I go

7:29

and pick it up . I'll do it while I'm putting petrol in

7:31

my car , so you know it's

7:33

not an extra trip . So it saves

7:36

the consumer time

7:38

and money that otherwise

7:41

would be spent waiting . You

7:43

know , waiting for the doorbell to ring inconveniently

7:46

, or travelling somewhere for a special

7:48

trip and I think this is the big news

7:50

to the UK market and I really

7:52

think the UK market is ripe to

7:54

change , to really add this

7:57

locker channel in the coming two

7:59

, three years . I think it's going to be a huge explosion

8:03

because when the realisation

8:05

comes that some of

8:07

their consumer base not all

8:09

, I'm absolutely not claiming

8:11

that all will , but a significant

8:13

number of people currently

8:15

ordering and getting delivered

8:18

to their home will actually be happier

8:20

to go to a locker pickup

8:22

point , I think that's going to be one of those

8:24

huge UK

8:26

light bulb markets and the

8:28

UK retail market will really

8:31

change because the carrot the carrot of

8:33

cost of doing home delivery

8:35

is so big , it's

8:37

such a huge cost that

8:40

when people realise that you can actually realise

8:43

those huge cost benefits and

8:46

your customers will be happier , it's

8:49

the ultimate win-win . And I haven't even

8:52

begun to mention the environmental benefits

8:54

. I mean fleets of

8:56

trucks and lorries and delivery vans

8:58

driving around from house to house to house

9:01

to house . The

9:03

cost of that's huge but the carbon footprint

9:06

is huge , the fuel spent

9:08

on that is huge and

9:11

if you can eliminate even a

9:13

portion of that whilst making

9:15

a portion of your customers happier , then

9:18

I think retailers are really , really going to

9:20

go crazy for this solution

9:23

and I think it's going to be huge .

9:25

Well , everyone's struggling and backtracking

9:27

slightly on their 2020 , 2030

9:30

net zero challenges , aren't they

9:32

including kind of the government and alike ? So

9:34

there's a huge cost . I suppose

9:36

my working assumption would have been that the organisations

9:39

would just start to put the cost up of last

9:41

mile and almost price . Unfortunately

9:44

, people out of the market has it got more expensive

9:46

.

9:46

Yeah , it's one of these things where

9:48

the carrot and stick debate

9:51

is always there , and if you have to provide

9:53

a stick to encourage a

9:55

certain behaviour , then maybe

9:58

you have to If you

10:00

can do it with the carrot and the carrot is convenience

10:02

, so if you can say there's a more

10:04

convenient way for you

10:06

, the customer , you know when you're on

10:09

your school run , drop in at the locker

10:11

on the way , pick up the kids , go home . You

10:14

have total control over when

10:16

you pick up your online order

10:18

. As I say , it's not adding a trip , it's not adding

10:21

any cost . So you get convenience and

10:25

you know the flexibility to do things

10:27

when you want , at the same

10:29

time as being beneficial for the environment

10:32

, because it's really hard to stress . You mentioned

10:34

the net zero

10:36

goals and the Environmental aims

10:39

that companies have . I think this

10:41

is also a huge opportunity

10:43

for them , because most companies are thinking Well

10:46

, if I convert my fleet to electric

10:48

vehicles , I'll make some

10:50

big inroads on

10:52

the environmental front , and they're right

10:54

, certainly , but it's not solving

10:56

all of the problem . So I read

10:59

somewhere that the carbon footprint

11:01

of an electric vehicle is around

11:03

about a third of what

11:05

a petrol or diesel vehicle

11:07

will be . So it's not zero because

11:09

it's electric . It certainly helps

11:12

to solve the problem , but it doesn't remove

11:14

the problem . Removing

11:16

the special trip to

11:18

that house to deliver those groceries

11:21

, that takes away 100%

11:23

of the carbon footprint .

11:25

Yeah , I think there's still yeah

11:27

, there's still that debate isn't there as well , of the

11:29

end to end production of an electric car . Is

11:31

it as environmentally friendly as being

11:33

suggested with the creation of the battery ? There's

11:36

still a massive on known in the disposal of

11:38

the battery . So so , yeah , you're

11:40

right , we have people have to be careful on just

11:42

switching to electric flea . Is is the

11:45

panacea and clearly that's a significant

11:47

cost as well . Yeah , so

11:49

I suppose I've rationalized

11:51

it in my mind as you've been speaking is on demand . So

11:54

if I want to watch a film At

11:56

home , I can put Netflix on and I can watch

11:58

it . When I want to watch it , I can pause it . I can

12:00

watch over three nights . One night I can

12:02

rewatch it . Really , what , what

12:05

we're almost getting to here is and

12:07

let's use grocery is the example shopping on

12:09

demand . So as a retailer

12:12

, I know that in between X windows

12:14

you're gonna collect it , which I think

12:16

is really , really helpful for a retailer , because back

12:18

to probably our old world's Tim , if

12:20

you've got known demand , that's

12:23

planable . That's far easier

12:25

to staff Resource and

12:28

carry out the activity at given times

12:30

than Unknown demand which

12:32

is me walking in , if I feel

12:34

like it this afternoon , if I feel like it tomorrow

12:36

, to browse the shop . So I

12:39

think there's a whole bunch of , you

12:41

know , environmental stuff on demand

12:43

, you know , in my time windows

12:46

at my preference . But also Clearly

12:48

there's a cost benefit at the retail side

12:50

. But also from a planning of workload point

12:53

of view it should become

12:55

far more known . So

12:57

fit or fix this probably the word far

13:00

more known rather than variable and variable

13:02

is is the bit which absolutely

13:05

screws all your schedules , because do you

13:07

know , if a coach load of people are going to turn up and

13:09

by sandwich it's going to throw it down

13:11

, no one's going to come in right .

13:13

Right and and you're right that there's there's

13:16

knowing the demand , there's also influencing

13:18

the demand , so you , you may be able

13:20

to give incentives towards , you

13:24

know , certain time slots , certain

13:26

geographical locations , so

13:29

it's an interactive thing . You can , you can also

13:31

influence the

13:33

demand , but certainly knowing what

13:36

it can be . But I , but I think I think

13:38

just having multiple

13:40

channels Available

13:42

to customers Is going

13:44

to be the most important thing because the the

13:46

cost-saving elements there . They're

13:48

really exciting and they're particularly if

13:50

you can get Home delivery

13:52

moving to other channels . The cost savings are

13:54

absolutely huge . But

13:57

I think the the customer focused

13:59

positives Are even more

14:02

exciting in a way . So if you can say to

14:04

your customer base , instead of two

14:06

options you know home delivery

14:09

and there'll be options within that

14:11

you know fast delivery , slower delivery , you

14:13

know choose your urgency type stuff options

14:16

, for sure , but but broadly speaking , that's

14:18

home delivery or Click

14:20

and collect . You know you come , come to us

14:23

and and pick up your stuff . As well

14:25

as that , there are other channels available

14:27

for your convenience and

14:30

, like I say , some portion of the market is going to going

14:32

to really like this and it's not necessarily

14:34

just lockers . I think they're a really

14:36

important addition that

14:39

will come in the UK . But in some market

14:41

markets there are things like drive-through collection

14:43

points where you know

14:45

you go into a Space and

14:47

a system will read your license

14:50

plate and know that you've just arrived . And so by the

14:52

time you get to the Pickup point

14:54

, your orders , they're waiting for you . Throw it straight into

14:56

the boot Off , you go . You

14:58

know that's a channel that's barely Existing

15:01

in the UK . Maybe that's something

15:04

that's interesting . There are also

15:06

things like temporary Channels

15:08

. I find this Really

15:10

interesting . Yeah , the locker example

15:13

that I gave the , the sort of mass collection

15:15

point . Historically

15:18

that's been a fixed thing . You know we put a bank of you

15:21

know red lockers somewhere in a car park

15:23

and everyone knows it's there and that's where it is and that's

15:25

where it stays . But actually

15:28

strong point has Mobile

15:30

lockers as well , where you might think there's

15:33

a festival coming up . You

15:35

know why don't we Put

15:37

a temporary Collection point at

15:39

a comedy festival for a couple of weeks ? You

15:42

know people are there , people are going to want product

15:44

. Why not make it convenient ? Why not

15:46

make it a good branding exercise

15:49

? You know , let's show the attendees

15:51

to some event that

15:53

there's a channel here where you can really conveniently

15:56

Get the products that you need

15:58

. So you know mobile

16:00

lockers , temporarily , it could be with with sporting

16:02

events . It could be again in the Nordics

16:04

. One thing's quite common There'll be a Scheme

16:07

season . Let's say so . Let's have the collection

16:09

points In the

16:11

places where everyone goes for their skiing

16:13

trips , and then when it's the summer and those

16:16

places are not frequented , no

16:18

need for it to be there . So you can have temporary

16:20

channels for different reasons

16:22

. And I think this yeah , ultimately

16:25

these options are addressing

16:28

cost and the environmental issues that tend

16:30

to go along with cost as well , but

16:32

they're also giving positive new

16:34

options for customers

16:37

to make customers happy and ultimately

16:39

be more loyal to your brand and

16:41

probably even buy more frequently

16:43

or by larger when they do buy

16:45

.

16:46

There must be opportunities as well in places like inner

16:49

city hotels , where you've

16:51

got food being delivered that could be stored in

16:53

there and you almost become

16:55

endless in terms of the things

16:57

that you can think . You know ordering parts

17:00

or something . A car dealership

17:02

if you were just picking up bits , you know Halfords , probably

17:04

a great example where I just want a

17:07

bulb from a car and there becomes

17:09

endless when you start to put your mind to it .

17:11

It really does . And you know , in

17:13

that example the Halfords

17:15

example you know , maybe I

17:18

was busy all day doing work or something

17:20

and by the time I'd like to pick it up , the

17:23

stores closed . You know what a pity . Well , if it's a locker

17:25

, you punch in your code , you

17:28

pick up the product , you know you're not encumbered by

17:31

sort of operational matters like when's the store open

17:34

. So there are many , many reasons

17:36

why this

17:38

channel , in particular the locker channel

17:40

, is something that delivers

17:43

both convenience and cost

17:45

reductions . And , as I say

17:47

, when I look at the

17:49

UK retail fulfillment

17:52

market , I think the locker

17:54

channel is the thing that really

17:56

is going to transform this market

17:58

in the next few years . And it's not . This isn't a

18:00

you know . Theoretically , I

18:02

think this could be a big thing because there's a

18:05

you know such a strong cost saving

18:07

case . It's not theoretical

18:09

at all . You can point to markets that

18:11

have done this right , where it's a

18:13

very significant part of their

18:16

online structure

18:18

and where the business

18:20

case and the positive customer

18:23

feelings towards it are very well known and very

18:25

well documented .

18:27

Brilliant . So on the last episode we

18:29

talked around kind of the automation piece , amrs

18:32

. Some of the humanoids hit clearly with this

18:34

one . We've talked about last mile and lockers . If

18:37

people want to find out more , tim , take you

18:39

up on some of those kind of other countries

18:41

are doing this . Teach me , show me where's

18:43

the best place for them to get in touch .

18:46

I can be emailed at timwheeler

18:48

, at strongpointcom . You can probably find

18:50

me on LinkedIn although there's probably many Tim

18:53

Wheeler's , but Tim Wheeler , strongpoint

18:55

, linkedin's a good place to go and

18:58

, of course , the Strongpoint website . Ultimately , you'll

19:00

get to me as well .

19:03

Brilliant . So we'll link your name on

19:05

the show notes to your LinkedIn profile

19:07

so we don't find a different Tim Wheeler , because

19:09

that'll be awkward for him , I'm sure and

19:13

we'll also put a link to the websites so people

19:15

can click straight through to reach out if they've got any more

19:17

questions . Great stuff .

19:18

Thanks , simon . Thanks for having me again Brilliant Now . Always a pleasure to catch

19:20

up , Tim .

19:20

Look after yourself and we'll speak to you .

19:24

Thanks , mate , bye-bye .