Lee Williams: We find online retailers want to have a cool office in like, you know, Surry Hills in Sydney or like South Yarra or Prahran in Melbourne. And that's where their team sits, right? And where the engine room in the background that's performing all that grunt work to make sure the stock gets to the customers as quickly as possible. What's also really cool is that these robots are working on wi fi throughout the warehouse. They're battery powered so they go and put themselves to sleep and charge whenever they need to have a rest and charge up. We made that term up 12 years ago when we had to put shipping labels on Kogan TV boxes and that was our first lick and stick customer.
[Voiceover]: Welcome to ADD to Cart, Australia's leading e commerce podcast that express delivers all you need to know in the fast moving world of online retail. Every week Nathan Bush from E Suite and an e commerce industry expert will share the news, research and insights that you need to know know to keep you at the top of your game and of course keep your customers adding to Cart. Hello and welcome to ADD to Cart. My name is Nathan Bush, host of add to cart and director E commerce talent agency E Suite. One of the things that I first noticed straight away when I entered the e commerce scene was how proud everyone was of their warehouse size. Yeah mate, we've got 5,000 square meters out in Homebush. We're almost at capacity and we're going to push it to 20,000 square meters next year. It was almost the equivalent of the what school did you go to Question when you first meet someone. Well, you don't want to compete with today's guests when making these comparisons. Lee Williams is the founder and the Managing director of Estore Logistics, a third party logistics fulfillment and warehousing solution for for small, medium and large retailers. And in Lee's own words, they are aiming to democratize access to enterprise level logistics for all retailers. Estore Logistics runs fulfillment and warehousing for some of Australia's biggest e commerce brands including Kogan, Temple and Webster and MyDeal. They're fulfilling, get this, 20 million orders every year and in the last 14 months alone have tripled their warehousing capacity and to 120,000 square meters. Oh yeah mate, there's a big warehouse. In today's conversation, Lee shares how the Estore logistics model works across operations and technology for those e commerce businesses that they fulfill on behalf of. Lee also shares how Estore's Autonomous mobile robots AMRs to you have pushed the efficiencies that they can create to the next level and also allow them to offer a 4pm same day delivery service. We also discuss why dangerous goods are so hard, why robotic arms are the future and why show bags showbags have been the surprise Covid e commerce hit. So let's get into it. Thanks to our partners Shopify plus and Signet. Here's our conversation with Lee Williams from Estore Logistics. Lee, thanks for joining us on Add to Cart.
Lee Williams: Yeah, great to be with you today, Nathan. It's good to chat with you.
[Voiceover]: Absolutely. Now I appreciate your time because we are about eight weeks out from Christmas. You probably know the exact amount of days as one of the largest logistics and fulfillment services in Australia. How are you holding up?
Lee Williams: Look, things are going really well at our end. We start planning for the peak periods in sort of the end of June, start of July every year. So that involves, you know, looking at, speaking to all of our retailers, understanding what their forecasts look like, then translating that to ensure that we have the right capacity in place. You know, from a warehousing perspective, footprint perspective, also the infrastructure, whether that be pallet racking robots, forklifts, RF guns, all the stuff needed to fulfill and run a warehouse operation and to get all those plans in place. So we're in a pretty good position and we've sort of got an idea of where we think the levels will be this year and we're looking forward to getting through that peak period and out the other side.
[Voiceover]: That's brilliant, mate. You're looking very calm and relaxed so it's always a good sign.
Lee Williams: I wasn't expecting a great team around me. It's important.
[Voiceover]: That's true, it's true. And we'll get to that. We'll get to that. How do you forecast a year like 2021?
Lee Williams: Good question. It's very difficult to forecast. So we kind of work in a couple of different ways. We work directly without the retail customers, the retailers we work with and you know, our top customers were in constant dialogue, understanding where their footprints going towards what their ordering cycles are doing, whether there's any delays upstream in stock coming from overseas, whether they're changing their product profiles. You know, some retailers, there's one that started with this last year with one SKU hand sanitizer and now has a whole furniture range. So it's really key for us to be maintaining very close dialogue with the biggest customers. And then the smaller ones, we're just kind of looking at historically how they've been trending. Some of them we're talking to Trying to understand where they're going. But then we look at using our data to then forecast forward and we've been able to open up a number of different warehousing facilities over the last sort of 15, 14, 15 months that able us to keep up with that demand.
[Voiceover]: What's your gauge on how retailers are feeling going into this season? Do you feel they're optimistic? Are they nervous, are they stressed?
Lee Williams: No, I think retailers are very optimistic. A lot of them are very well stocked at the moment, which could be a bit of a hangover from ordering being delayed out of manufacturing overseas. A lot of I forgot a few retailers which actually manufacture locally as well. So whether this be health and beauty or skin care or proteins, they've been able to get very good and quick access to stock. So I think generally it's very positive and I think we expecting to see a Christmas which is similar to last year for E Comm or maybe a little bit bigger.
[Voiceover]: Yeah, that's fantastic. And obviously there's been never been a better advertisement for manufacturing locally than 2020 and 2021. With some of those issues coming through from your perspective, obviously a massive, massive growth period for east or logistics. I read that you now 120,000 square meters of warehousing, 80,000 of which have opened during the last 14 months. So during COVID how have you come through that period? Did you expect that kind of growth?
Lee Williams: So the growth that we've had while Covid's been a contributor, it's not been the key driver. The key driver's actually been the maturity that we got the business to at the start of 2020. And what that means is we had the right systems in place, the right processes in place, we had the right financing in place and we're ready to scale. Right? So in March 2020 we implemented our first autonomous mobile robot system, which had been two and a half years in the making that went live in March. We sort of filled the system up over a two or three month period. And as we saw it hitting the benchmarks, it's meant to hit the business case working. That enabled us to then start pushing the button on our bigger business plan, which was to continue rolling out more distribution centers. So we've gone from this single distribution center with the robots, which was the distribution center number five in March last year or four last year. And since then we've rolled out four more distribution centers, three of which have got the autonomous mobile robots in it. But the key I think for us is there's a huge addressable market which is not being addressed in Australia for efficient and high quality fulfillment services similar to what Amazon provides. Right. And essentially what we've been able to do is democratize access to retailers of all sizes to get access to this enterprise level logistics. So what this means is you've got a retailer might be a category champion, they're selling skin care or mountain bike parts or something like that. And these aren't products that this brand, these aren't brands that are on Amazon, they're not selling on Amazon. We're enabling these sorts of retailers to scale without the capital outlay and to have a quick turnkey solution to achieve that.
[Voiceover]: Yeah, right, okay, cool. So I want to come back to the autonomous robots because that's just fascinating and obviously we've seen a lot of development from yourselves in that area. But before we do, can you give our listeners, many of who are retailers, an idea on how the estore logistics process and model works?
Lee Williams: Yeah, sure. So we're a technology enabled logistics business. So we've got eight distribution centers across Australia which we fulfill about just over 20 million orders per year for. And this is for retailers of all sizes, all the way up from ASX listed retailers doing tens of thousands of orders a day down to small retailers which are startups might be doing 50 orders a day. Now we're a turnkey solution in that we handle all the inventory management and all the warehouse processes. So we take the stock from port, we bring it to our distribution centers, we check it onto inventory systems, we store it in our warehouses and then when there's a sale on the shopping cart or an order which is going to go to a retail store that's transmitted to our systems. Our teams then work with our robot systems to perform the pick and pack processes and then we arrange the last mile delivery. So we've got big commercial accounts with the major carriers such as Australia, Post, Toll, ipec, all the big guys, Allied Express and we offer that as a holistic solution.
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Lee Williams: So it's purely activity based. So if you bring in five shipping containers or five pallets, it's a fixed fee per pallet that comes in or per shipping container. If you utilize 100 pallets in our warehouse or 1,000 pallets in our warehouse, it's a fixed fee for the consumption of what's in the warehouse. If you have a thousand orders on that particular day or five orders, you only pay per order and the units are on the order. And the same with the last mile delivery. Like you'd see usual carrier rates, you just pay per delivery.
[Voiceover]: Yeah, great. Okay, that makes sense. And do you find most of your retailers don't even see stock?
Lee Williams: Absolutely. So most of these retailers, they source from Asia, they work with their manufacturers there. Maybe they get some samples in which they use for quality control. Sometimes they don't. And when stock hits our warehouses, we've got to perform that quality control. But we find online retailers when I have cool office in like you know, Surry Hills in Sydney or like, you know, South Yarra or Prahran in Melbourne and that's where their team sits. Right. And where the engine room in the background that's performing all that grunt work to make sure the stock gets to the customers is those orders get to the customers as quickly as possible.
[Voiceover]: It's almost like drop shipping without the dodginess.
Lee Williams: That's it. Yes, absolutely.
[Voiceover]: There you go. You can use that one if you want your next ad campaign. What about things like customer service and returns, how does that all tie together?
Lee Williams: We have a cloud based logistics product which enables retailers to see live what's happening within our distribution center. So they can see all of the inbound orders coming in from demo from their suppliers and then those being processed, they can see all the inventory and all the attributes associated with those. They can see all the sales orders flowing through. Right. And often that system is actually integrated with this shopping cart or whatever ERP they're using. So when a consumer has an inquiry about an order, let's just say they placed an order and they put in the incorrect address for their house. So they've ordered the wrong product. They often via the shopping cart can actually edit the order before it's been processed. So that Cuts out the whole. That whole customer service piece. Right. And creates efficiency because then the retailer doesn't have to answer a question. And that crate. And that means that a store also doesn't have to manually get involved. So it enables the consumer to edit their order or do whatever change they need to do. Or if there's a problem after the order, maybe it's not what they expected, or maybe there's a delay with the shipping carrier, they may raise a query directly with the retailer, which then gets funneled through to our teams to enable them to solve that problem. And returns, we have all online platforms which enable seamless returns for the consumer. So that is, go online, fill out the form, it sends the data through to the retailer, it sends the data through to us, the return comes to us, we process that return and then that triggers maybe a refund or a replacement item to go out to the customer.
[Voiceover]: Yeah, great. What's the conversation normally look like when you first explain this model to new customers who may not have seen or heard about it before?
Lee Williams: There's a lot of education that goes on when you look at varying retailers and their sizes, and you look at ones that have sort of fairly fresh and new to online retail. It might be a young team, they've got a startup that might be one or two years into running their operation, they still don't have barcodes on their product. Things are very manual. There's got to be a lot of education that goes in on there. One of the key things that we require to provide an optimized service is what we call an item master. Now, the item master has, as you know, Nathan, you know, all the key attributes for the products, right? You got your skuid, you've got the barcode, you've got the product dimensions, you've got the product weight. Then we have special flags that might be added for, for example, a fragile item or a special flag if something needs to be shipped. What we call lick and stick. You know, if you buy a microwave or you buy furniture, that product doesn't actually go inside packaging, so you have the shipping label that goes directly onto the box.
[Voiceover]: I hadn't heard the term lick and stick before.
Lee Williams: Yeah, yeah, well, lick and stick, we made that term up 12 years ago when we had to put shipping labels on Kogan TV boxes. And that was our first lick and stick customer. And since then, obviously, we've got plenty of customers with that solution. But coming back to this item master, it's really where a lot of the business rules are set up. That automates the data flow from shopping cart to carrier. And what I mean by that is once we receive that order, we don't. To create a scalable and repeatable process from a pick and pack perspective, we need to have the system directing our people on what to do, so it directs them on what packaging to do. So we've got 3D cubing and cartonization algorithms that work out which is the most efficient packaging and the most suitable packaging to send some to send an order. Once you know how it's going to be packed, you can look at what shipping carriers are suitable. There might be five shipping carriers that can ship a bulky item or 10 shipping carriers that can ship a smaller item. And then you look at the cheapest cost out of those carriers and you look at where the stock's available across various warehouses. Right. And at that point we haven't done anything to the order, we haven't filled it. Right. We've just worked out what packaging, what carrier, what warehouse to ship it with. And then from there we use the data to essentially work out what pick and pack process will be the most efficient to fulfill the order. Right. And based on SKU velocity, based on product profile, we then allocate an order down a specific way. And so if we can get all that up front from a retailer, that is the secret sauce to having an optimized back end. And that's the five minute explanation.
[Voiceover]: It sounds simple.
Lee Williams: There's hours of explanation usually that go into this sort of stuff.
[Voiceover]: Yeah, it's really interesting to know. So if I'm a retailer who is fulfilling myself at the moment, so I've probably got product information, I've got inventory information, I've got fulfillment maybe intelligence behind all that. Obviously I can get rid of fulfillment intelligence. If I'm coming over, do I need to transfer product and inventory management into your proprietary software or is there an API link? How does that work?
Lee Williams: Yeah, we've got all of the integrations into the major platforms. If you're using Shopify, for example, what we will do is we'll be the gold source for inventory management because we know when stock is arriving from suppliers before Shopify knows. Shopify knows about sales orders, obviously, and Shopify knows at a point of time what the inventory is. But essentially we become the experts managing that process and that's actually key. One of the key services we provide to retailers and that's ensuring that their inventory is actually correct. Because one of the worst things they can be doing is selling something they don't have. Because an Inventory management issue and then disappointing the consumer when they have to tell the customer the items are available.
[Voiceover]: Yeah, worst experience ever.
Lee Williams: Here's a funny one though. We do see some retailers with very small SKU ranges loading into their shopify accounts or whatever system they're using unlimited inventory. And because they've got such a limited SKU range, they're not so worried about what the inventory at the gold sources of each level and they just want to keep selling. Right. We've seen skincare brands, various brands like that that, you know, have five different products and just manufacture and manufacture, manufacture and there's just continually stock coming into the warehouse.
[Voiceover]: So keep pumping it through.
Lee Williams: That's right.
[Voiceover]: Is there any product when you're speaking to new customers or you've got retailers who are expanding their ranges, is there any product that you go, oh, that's just a nightmare.
Lee Williams: Fulfillment wise, there is dangerous goods. So you probably never even thought about this, right? But hand sanitizer is a dangerous good because of the alcohol or whatever is in it, Right. There are hair products like hair sprays which are dangerous good. There's whatever fragrances, perfumes, these are all dangerous goods. And from a lot of small online retailers don't actually understand that there's limitations around what you can do with this. And they don't even understand that there's special declarations and limits to send them through carrier networks. And often they come to us, they sort of reach a point of critical mass, they want to scale and they want to start working with this and they're like, why can't we store X amount of volume in a certain warehouse? Or why can't we ship 10 liters to one consumer with this carrier? They don't understand it. So it really is quite challenging. We're limiting a little bit around that type of work we're doing at the moment.
[Voiceover]: Makes sense. It's so complicated. I wasted. Well, I didn't waste. I won't say waste, but I spent months of my life working out how to sell car batteries online for super cheap auto. That's a nightmare because they're heavy as well as dangerous. But you got to do it. Beautiful. So can we dive into your autonomous mobile robots that you are very well known for during the research for this, I saw you explain it to the crew on the Today show, which was fascinating seeing you. I won't say dumb it down, but you essentially tried to dumb it down to make it palatable for everyone. How do they work?
Lee Williams: Okay, so we've got lots of people still working within our distribution centers. When stock arrives at our dock door, we're having our team members receipt that stock onto inventory, right? And the robot system is really driven by the software behind it. So once that stock starts hitting inventory, their robotic system, the software behind that, then starts calculating what the most efficient way and most productive way to store that stock is. So the stock gets receded onto inventory. You've had 100 bottles of hand sanitizer arrive. Whatever it is, the system's worked out how to store it into the system. And at that point, it then directs our people. The robots are bringing these shelby units to these pick and pack stations, and our people are then putting that stock into the system. And this is where the magic starts, right? So as it starts learning over time, when it receives orders coming into the system, it then can optimize the storage location of all these mobile storage units. So you've got robots, they look like vacuum giant vacuum cleaners, robo vacuum cleaners. They're moving around, and we call them AMRs, they're autonomous mobile robots. They move around mobile storage units, which just think of like little pallet racking systems that are about three, three or so meters high. And it's optimizing the storage of all those locations of those storage units based on the stock that's sitting within those storage units and how fast that stock turns through our warehouses. So then once consumers then go online, they place an order, that order gets transmitted into our systems. That then triggers the robot to go up and then pick up one of those storage units to deliver them to a pick station where one of our people are being directed on which product to pick out and to then merge them into orders which are going out the door. But as the data, the stock, the system is receiving more and more of this data. Essentially it's just working out what the most efficient way is to pick what the efficient way is to store the stock. But what's also really cool is that these robots are working on wi fi throughout the warehouse. They're battery powered, so they go and put themselves to sleep and charge whenever they need to have a rest and charge up. And essentially they're communicating with one another to ensure that they've always got their the most efficient pick path to deliver stock to the right location. Now, what this is enabling us to do is to essentially push back the cutoff time for same day fulfillment as late as possible. And so so far, we're doing 4pm for a same day fulfillment and same day delivery in a manual environment where you've Got people walking around the warehouse. Obviously that reduces the speed that you can fulfill items and also creates a bit of a less safe environment for people to work in. So there's many benefits from these systems. You know, it's improving the speed of fulfillment, it's improving the efficiency which is driving down costs and it's also improving safety of people working in these distribution centers.
[Voiceover]: Yeah, brilliant. And you've got 330 of these robots throughout your warehouses. Is there an optimal number of robots to storage racks that you aim for?
Lee Williams: It depends on the product profile going into the system actually. So one of the. While we've worked with a vendor to deliver this solution, we've got a highly customized mobile storage unit. So our system is the only system in the world which only automatic storage and retrieval system which returns an Australian sized pallet and small pickable locations. Usually systems do one or the other. You know, Ikea delivers pallets of furniture, then you've got groceries, supermarkets, systems like what Coles is putting in, which delivers totes of small, small units. Now when we've got different profiles of customers in the system, we've got to run calculations that work out what the robot to mobile storage unit ratio needs to be. But then also we need to work out what the ratio is for pick and pack stations. So that changes. If you're doing wine, we've got pallets of wine in this system. So it also changes to we've got a customer does show bags, right. And that's gone mental because people haven't been going to the show the last two years and the average lines per order is like seven lines in order, seven show bags per order. But then we've got other clients where there's only one or two lines for order and that that impacts all these variables greatly.
[Voiceover]: And on the mobile storage units, do you set them up so that they're usually the same retailer sharing that unit or is there more intelligence that goes into it in terms of customers often buy this product with this product, even if it's not from the same retailer.
Lee Williams: So you've got a mobile storage unit. That unit may hold multiple retailers stock, but within that unit you've got different locations within it, right? You might have on a mobile storage unit 50 locations. And that's from a tiny little drawer that like, you know, you couldn't even fit shoes in because that suits like an iPhone, screen protector, all the way up to what we call a case which fits, you know, 10 or 20 pairs of shoes. So the system is optimizing on put away based on hot skus getting them closer together, creating what we call golden zones and this sort of stuff. But it doesn't optimize cross retailers, so it doesn't. We're not necessarily packing the same retailers orders together, right? Yep. But when a mobile storage unit's delivered to a picker, it might ask for stock for client A, which goes into an outbound tote, then it might ask for stock for client B which goes to an outbound tote and then that mobile storage unit then gets moved away and moved on, it goes back into storage and the next mobile storage units bought in for picking, which could have multiple clients across it.
[Voiceover]: That's very cool. I love it. I love it. Where do you see robotics going beyond your AMRs in efficiency or even customer service?
Lee Williams: For us, our first foray into automation has been these autonomous mobile robots. Mainly because the flexibility it drives across a huge array, different product types and so the risk is actually quite low for a 3 PL like US logistics provider. Then the next step from there is we've put conveyor and sortation systems behind that which enable us to essentially load orders into specific pack stations which have special packaging types to package the orders that are specific to those retailers instead of people having to perform that sortation. So there's more optimization happening at that level. Then once the order has been packed, it's then going and being sent down a conveyor system and sorted into its shipping carrier route or whatever that is. Now by having a sortation system, you can increase the number of carriers that you're using and do that efficiently and cost effectively. And we're seeing it carry a proliferation across the board, particularly through Covid, where some carriers have struggled and other carriers have had to pick up the slack. And particularly because there's uptake of same day services and other things like that. Now from here, robotic arms are the future. So there are, and what I say about robotic arms are these are these units which essentially can pick items out of the mobile storage units and place them into the outbound totes for those to be delivered to pack stations. And of course packaging machines which perform the packaging component, which all of these things I'm mentioning deliver optimization, enable you to scale up and down, create scalable and repeatable processes and ensure that essentially the highest quality goes into the fulfillment. But the robotic arm, I would say is 10 years away from being able to pick wow, everything right. I know of companies right now that can do fruit or mango, you know, or avocados. They can pick up iPhone boxes only if you're only selling iPhone boxes, you can go get a pickable arm. But we're dealing with like things of all shapes and sizes. Like we've got clients that have tires for mountain bikes that are wrapped up in rubber bands. We've got clients that have apparel that are inside, like eco friendly sleeves. You know, you can imagine arm trying to pick up something all floppy. It's challenging.
[Voiceover]: Absolutely. Yeah.
Lee Williams: That's where I see the future and where the next optimization's gotta come from.
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Lee Williams: There's definitely temptation to go into last mile delivery and we're spending a lot of time researching how that can work, particularly now that we've got economies of scale with the amount of volume we're doing into our distribution centers. Drones, I think are still quite a way off for us. We haven't done any planning around that yet and that's purely because the requirements are still very unknown. You know, we're, we're at the Mercer of Casa and whatever restrictions they have in place. I think from my understanding, CAS is currently doing a couple of trials. One in the act, one in. I think it's in Logan in Queensland.
[Voiceover]: Yeah, they got it on the shopping center roof.
Lee Williams: Yeah, yeah. Where they're. I don't know the exact details, but they're, they're. CAS is monitoring the noise levels of those deliveries.
[Voiceover]: Is that the biggest challenge, the actual noise of them rather than the flight paths?
Lee Williams: I'd say it's both, yes. I mean not, I'm not a drone expert, I love flying them actually, but we don't have one on our roadmap yet. Just purely because we don't know from a distribution center design and set up. We don't know what that looks like yet. You know, are we going to be doing it from Melbourne and Sydney, from urban areas, or is it only going to be in fringe areas which are sort of closer to the countryside where there's less of a noise issue, where there's less of a traffic issue? We don't know what the requirements are, but it sounds pretty futuristic. I think we'll get there in probably 10, maybe plus years.
[Voiceover]: Yeah. I think the experiments are more interesting than the possibility of rolling them out at scale at the moment. It's hard. It's hard thing to invest in when you don't know what the rules are going to be.
Lee Williams: I want to remain optimistic. So I'm not going to say it's not going to happen, but I think it's a long way off.
[Voiceover]: Oh, good stuff. Now you mentioned Kogan as one of your clients and they're obviously held in really high regard in Australian E Commerce, especially for customer experience. You've also got Temple and Webster and brands like Patagonia and I'm sure there's countless others that I can't name right now. Is there anything that you've seen from those leading retailers that you're working with on how they use fulfillment packaging and the end of the cut of that experience to really differentiate themselves? Any tips that you could pass on to our listeners?
Lee Williams: Tips. Okay, so in terms of differentiation, what's interesting is we've got to align ourselves with each of these retail brand promise and value proposition. And they're different. Right. And they also have their own. Each retailer has their own targets in terms of their consumers needs. That comes down to cost, brand values, service and quality. So what works for one retailer doesn't work for another. So let's use Patagonia, for example. They've invested heavily in eco friendly packaging. In fact, tons of our clients have. Right. And these are clients where their brand values align to that and where they'll only have compostable bags, they won't have apparel which has plastic around it and that they won't use void fill within boxes which is not compostable and these sorts of things. And that's actually a huge trend that we're seeing at the moment and something that we had to get on top of a few years ago. But then you've got other retailers where they're a price leader. Right. And cost is the most important for them and they look at where any place that cost could be stripped out of their supply chain. They're balancing it with service but service sometimes comes second to cost. But I think one of the key ones really has been the use in terms of differentiation looking across our client base, the use of same day services for last mile delivery instead of the standard delivery. So these are retailers which it's a lot of gifting actually. So toys, retailers that sell toys, interesting ones. Retailers sell costumes, retailers that sell spare parts for whether it's bikes or various things like that. These are retailers which they're category champions within what they're doing and their consumers demand this fast delivery and they're not willing to wait for it. So we're seeing those types of retail differentiate in that area. I mean another one really is operating on weekends as well. Fulfillment. A lot of fulfillment operations don't go ahead on weekends. They don't run on weekends. It's purely due to cost. One of our clients, Temple and Webster, we run every Sunday for. Because they are wanting to get ahead of the curve with orders where they're wanting to inject freight into the network as quickly as possible and they're just known for high service. So I guess there's just a few things some of the retailers were working with are doing.
[Voiceover]: They're great tips in terms of the estore offering. Is weekend and after hours fulfillment part of the service or is it kind of like an add on optional add on part?
Lee Williams: It's an add on, yeah. We all know as service increases with anything we're doing cost increases as well. Right. So typically we're a Monday to Friday operations. Most of the retailers we work with choose that service at peak. Pretty much everyone chooses to operate on the weekend and that's just an add on as well. But there's some retailers that all year round they'll run on a Saturday or a Sunday or to your point before
[Voiceover]: it's about having options and about having that ability to scale when needed. It's a nice option to have. We talked earlier around you being surrounded by some great people and we saw Amazon's results come out last week and there was a lot of chatter in there around that their results which didn't hit the levels that they expected. And they said a lot of that came down to availability of especially in the picking the packing areas of workers around that area. Are you finding the same limitations here in Australia?
Lee Williams: Yeah, there has, there's been challenges. So for example when the cases in Sydney started to spike a few months ago and there was a lot of shutdowns occurring, people were actually concerned about coming to work. So we actually found the labor market to dry up. You know, it was very difficult to get forklift drivers. It was very difficult to get access to team members that could work with our various systems. People were I think taking advantage of government subsidies as well. I think people were worried about coming to work. But as the vaccination rates have started going up and as those government subsidies have started to unwind, we've seen the labor market become a little bit easier. But sort of adding to all of this logistics just went nuts during this period and there was a huge demand for people to be working in these areas.
[Voiceover]: Yeah, it's a great opportunity. And do you find people coming into your business because they're excited by E commerce or is it, you know, what's the main driver, what's the team drive there?
Lee Williams: So I guess there's a few different reasons people come into our business. It's to get access to the latest technology. So there's not many warehousing operations that are running robots in Australia. Number one. And working within Ecom warehouses is also kind of the future. A lot of people can see that this is where things are going. More people are buying online, they love the convenience. Often they might be losing shifts in other areas they're working with, they're working in other retail which is sort of heading backwards and they can say this is the future. But in terms of tech people coming in, finance people coming in, it's just the excitement of a fast growing business. Right. We've been going very fast over the last few years. We've been growing at our team, we've been growing at our technology and we're working some really cool stuff which is going to make us differentiate us even further from other logistics providers here in Australia and add value to retailers.
[Voiceover]: Yeah, absolutely. You're definitely, you and your team are definitely leading the way and showing how innovative we can be in E commerce. When you are looking to bring people into your team, especially that senior or technical level, are there any kind of a store traits that you look for in people that you go oh yeah, that's an estore kind of person.
Lee Williams: Well it all comes down to our values. Right. So we've got four core values here at Astore. The client obsessed. We've got people that are running distribution centers here and they some of the key people with eight distribution centers, eight distribution center managers, those people running those centers, those leaders need to ensure that no matter what the volume is that's coming in from these retailers, we're on top of that and getting it out each day. Right. And so when you look at other traditional retail, often it's not as lumpy as what E commerce says. And so we've got to be assessing these people coming into our business, ensuring that they're on top of these things and are able to deliver.
[Voiceover]: Yeah, absolutely. Now Lee, I better let you go because we are in peak season and I'm sure you've got enough on your plate. Can you share with us? You shared with a few things but what's your top priorities at the moment for yourself and east or logistics?
Lee Williams: A few priorities, We've been working on these, we're trying to differentiate ourselves at the moment. Our top priority at the moment is developing out our cloud based logistics software, it's called Express. Currently it's available to customers. There's visibility into the supply chain of what's happening within our distribution centers. We're currently working on a whole analytics platform which goes into that, which essentially provides small to medium online retailers with rich data to help them make decisions on day to day run their business. So the stuff I'm talking about is showing them stock term, showing them cost per unit, shipped out the door per day, showing them the performance with shipping carriers, the performance within the warehouse heaps and heaps of these different dashboards that enable them to work out, you know, where their customers are buying products, what states that is, what products are hot and those sorts of things. We're currently going through a process of working out what these dashboards need to be and developing those out to put into our platform. And of course that just sits behind all the new DCs we've got in our rollout plan, all the tech we're planning on bringing with the distribution centers, packaging machines, multi storey warehouses and working out how we can deliver to the customer to last mile even faster than what's happening today.
[Voiceover]: Beautiful. No slowing down then. Now Lee, if people have heard this and are interested and like you said, your aim is to democratize access for retailers whether they're small, medium or large. What's the best way for them to get in touch with yourself or the team?
Lee Williams: Look, just go to estorelogistics.com click on contact us, send us an email or fill out the form and we'd be happy to chat to you and see how we can support your business and, and help you scale into the future.
[Voiceover]: Brilliant. Thanks for joining us Lee.
Lee Williams: Thanks. Great to chat to you Nathan. Thank you.
[Voiceover]: I've really enjoyed that opportunity to nerd out with Lee a little bit on fulfillment and logistics. Lee is obviously at the top of the game when it comes to that subject matter in Australia. So I was honored to be able to spend some time with him, deep diving into what the future of it looks like. And of course to hear more about their model. Now there are three practical takeaways that I took away that I'm going to share with you. Number one Lick and Stick. Not as dirty as it sounds. I hadn't heard the term before and Lee said they've made it up themselves. Can you identify any products or categories where no actual packaging is needed? Can you just whack a label on the product and get it out the door? Estore Logistics uses it on Kogan TVs. It might not be ideal for a pair of Chanel shoes, but it's a worthwhile solution if you're looking to reduce costs, move a bit quicker and reduce the impact on the environment. Number two Weekend and After Hours Scaling One of the biggest benefits that I saw in the Estore Logistics offering was the ability to scale quickly. Now this doesn't just mean the ability to have more warehouse space for stock or to be able to onboard more team members to pick and pack during peak times. It was the ability to go to after hours and weekend fulfillment as well. It's a differentiator today, but I don't think it'll be long until this is standard practice. 3. Technology as a Team Selling Point Lee said that many of Estore Logistics team are attracted to the role because of the technology and I mean, who wouldn't want to be in charge of robots all day? When recruiting new team members tell the story that gets you excited because it will get the right people excited. Rather than the lure of a salary, a story connection is more likely to bring you best fit team members to finish up. I have three resources for you. Firstly, if you're a first time listener of Add to CART and you want to stay up to date with new episodes, head over to add to cart.com and you can sign up for our weekly newsletter. We'll let you know every time a new episode drops as well as giving you my three takeaways from each episode and a link to the transcripts so you can know that this is an episode that you want to dive straight into. Secondly, if you want a weekly roundup of the best e commerce case studies, tools and research, sign up to the High Five Friday newsletter which is delivered to inboxes at 8am every Friday morning. I read all the e commerce news and send you the bits that I think you can take action from. Sign up at 12high12h I g h.com au forward/high5 and the last thing if you are looking to explore your next e commerce opportunity, head over to e talent.com we are a dedicated e commerce talent agency connecting the best e commerce talent with the fastest growing brands. Check it out. Sign up to the email and get in touch with me if you want to discuss your next move. Until next time, thanks for listening and keep those customers adding to Cartoon Sam.
