The Logistics Matters podcast: Jim Berlin of Logistics+ in Erie, Pa., on providing distributors and first responders with badly needed PPE equipment | Season 1 Episode 6 | DC Velocity
The Logistics Matters podcast: Jim Berlin of Logistics+ in Erie, Pa., on providing distributors and first responders with badly needed PPE equipment | Season 1 Episode 6
How 3PL Logistics+ has operated during the Covid-19 pandemic; how drones are helping in the fight against Covid-19; how retailers are turning their outlets into "Dark Stores."
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Transcript
Jim Berlin of Logistics+
David Maloney, Editorial Director, DC Velocity 0:01 Supply chain companies help their communities cope with the Covid-19 pandemic. Drones are being put to work in the fight against the virus. And distributors get creative in filling the huge demand for online orders. Pull up a chair and join us as the editors of DC Velocity discuss these stories, as well as news and supply chain trends on this week's Logistics Matters podcast. Hi, I'm David Maloney. I'm the editorial director at DC Velocity. Welcome. Logistics Matters is sponsored by Fortna. Fortna partners with the world's leading brands to transform their distribution operations to keep pace with digital disruption and growth objectives. Known worldwide as the distribution experts, Fortna designs and delivers intelligent solutions powered by their proprietary software to optimize fast, accurate, and cost-effective order fulfillment. For more information, visit Fortna.com. As usual, our senior editors Ben Ames and Victoria Kickham will join us to provide their insight into the top stories of this week. But before we get to that, I will turn the floor over to Ben to introduce this week's guest. Ben.
Ben Ames, Senior News Editor, DC Velocity 1:11 Thank you, Dave. Good morning. We have a guest with us, joining us here today, who's Jim Berlin. He's the founder and CEO of Logistics Plus, which is a third-party logistics operator in Erie, Pennsylvania. Jim, thank you for being here.
Jim Berlin, CEO, Logistics+ 1:25 My pleasure, Ben. Thank you.
Ben Ames, Senior News Editor, DC Velocity 1:27 Jim has had a long career in the industry. He's had a 20-year career in the less-than-truckload sector before founding Logistics Plus in 1996 and helping to grow it from just a three-employee operation to having more than $300 million in global sales last year. Jim, we can see you've had some long perspectives on business in the logistics sector, but we're now living through some times that are not quite like any others. I know you just mentioned that you even have some of your back-office computer operators stuffing PPE [personal protective equipment] in the warehouse, there. So there are obviously changes in every part of the business. Could you tell us a little bit more about some of the particular challenges that you've been seeing coming from the coronavirus challenge?
Jim Berlin, CEO, Logistics+ 2:11 Sure, yeah. And you're right, I've been doing this for most of my life, from my days as a truck driver and running an LTL operation to starting this [Logistics Plus] 20 years, 25 years ago. Nothing like this. Not even close. And what we've done--and like, I'm not, I'm not that smart, but I do have a hard head, and we always try to figure things out. So when this thing began, you know, the question is, do you hide or do you kind of figure it out as you go, and we kind of rally the troops to "Let's do something here." And so a lot of our customers were not doing anything, so you can't work for them, but the ones who are still having business would come to us, and we were creative and resourceful in finding solutions for them. And then we found that other customers of our customers, but maybe someone else's customers, were finding they couldn't get the help they needed. So we've had a lot of new people who heard through the grapevine, mostly, that "these guys are moving stuff." So we've actually increased our business with a whole new customer base. Part of which, as you mentioned, is the PPE. We saw that local facilities were having a hard time finding it and getting it. And so we went out there and used our connections around the world, and we're not only able to deliver, but we're able to procure, like almost 10 million pieces already, of masks and hand sanitizers and gloves and things like that. So, it kind of evolved into "Okay, let's figure this out." And I've always said we're a solutions company. And so the solution that western Pennsylvania needed was, "Find us some PPE for frontline providers," and we actually did that in more ways than one.
Ben Ames, Senior News Editor, DC Velocity 3:57 That's really fascinating. We've also seen a number of stories where certain sectors in the industry are seeing sort of winter-shopping peak volumes in what they're trying to handle right now, while others are virtually shuttered. So there's definitely been an effort to move some assets around in order to try to cover that surge in different places, as well.
Jim Berlin, CEO, Logistics+ 4:24 Yeah. What it's done, frankly, is--you know, there's an old quote by John Wooden, the old UCLA basketball coach, and he says "Adversity does not build character, it reveals character." And so, you know, I went from the gang and said, "Look, whatever it takes, let's do this." And so, as you mentioned today, we had a big shipment of PPE stuff come in. It needs to be sorted and palletized and wrapped. So I get the guys and gals from the computers and say, "You're not that busy, because a lot of our normal business is down, so let's run across the street to the warehouse and stuff boxes." And I like that for a number of things. One is, you know, all work is honorable work. So you might be a college graduate working on a computer, but nothing wrong with packing boxes. And it just shows the kind of fortitude and creativity of our group, that no one minds, that they actually like getting their hands dirty once in a while. It's a change of pace for them, too. So it's worked out really well and it's led to a whole new kind of operation for us.
Ben Ames, Senior News Editor, DC Velocity 5:25 That really is inspiring, isn't it? It's that there's a new sense of teamwork that we're seeing, and you see, in applications. Yeah.
Jim Berlin, CEO, Logistics+ 5:32 Teamwork and break down the walls, you know. There's no no walls. Nobody does just one thing here. You do whatever you need to do.
Ben Ames, Senior News Editor, DC Velocity 5:37 That's great advice. Looking forward on that, I wonder if you can pull out your crystal ball a little bit. We're starting to see some restarts, some opening up again, as part--certain regions, anyway, of the U.S. start to roll back some of the sheltering restrictions. Do you think that logistics business will go back to usual after this, or will some of these changes that we've been talking about be likely to stick around.
Jim Berlin, CEO, Logistics+ 6:04 Well, I'm not a good crystal ball guy, and I'm kind of very pessimistic on what this has done to the economy. So I don't know. I don't want to be negative about it. You know, it's starting to come back and we can see volumes picking up. I just don't think everyone will come back. You know, one of our customers is GE aircraft engine, for instance. And I just saw Boeing canceled 500 planes yesterday, so who are you going to build aircraft engines for? So, I think it's gonna be very hit or miss, but I think there'll be a major-- I don't know, "major devastation" might be too strong a word--but something close to that, of a lot of sectors of the U.S. economy. So we'll just have to--you know, you have to evolve, and so we'll find other customers that will survive and thrive, where some customers I think, are not going to be the same for many, many years.
Ben Ames, Senior News Editor, DC Velocity 6:56 Right. Boy, these are fascinating times to live in. In addition to some of those sort of changes in patterns of where your work is taking the assets of Logistics Plus, and some of the walls that are being broken down there, are there new standards that you're currently operating under, just in terms of safety, maybe social distancing and frequent-cleaning kind of things?
Jim Berlin, CEO, Logistics+ 7:21 Yes. From the beginning, we're in Union Station in Erie, Pennsylvania, which is an old, 100,000-square-foot train station, so we have a lot of space here. But from the beginning, we took our compromised employees, told them to work from home, and then we just asked people, like, "If you want to work from here, we'll wear masks. We'll do social distancing. We'll clean the place down, and just be smart and safe. And those who don't feel like coming in can work from home." But honestly, I mean, you can work from home, but it's really not the same. I've done that and I know. So I prefer people here, but we didn't put any pressure. If someone wants to be here, that's great, and you're more involved. And if you're here, you can run across the street to help in the warehouse today. If you're at home, you can't. So it gives you more kind of flexibility to be needed. But we've been very careful about that. And about, of the 140 people in the in the headquarters, between 80 and 100 came in every day, and then others have all come back by now. So we're back to full force and staying busy.
Ben Ames, Senior News Editor, DC Velocity 8:22 Gotcha. Well, that's great to hear. Jim, we really appreciate your joining the podcast today. It's been great to have this conversation
Jim Berlin, CEO, Logistics+ 8:28 It was my pleasure. Thank you, Ben.
Ben Ames, Senior News Editor, DC Velocity 8:30 And we wish you all the best in health and in business going forward here, so... . Dave, we have plenty more to talk about this week. It's been busy on all fronts, hasn't it?
David Maloney, Editorial Director, DC Velocity 8:40 It has been. And thank you, Ben and Jim. We appreciate your insight today. We're going to turn next to Victoria. You reported this week on how drones are playing a greater part in the fight against Covid-19. Can you talk about that?
Victoria Kickham, Senior Editor, DC Velocity 8:53 Absolutely. Yes. And this is in line with what Jim was just talking about in terms of changes in the workplace. It was an interesting study out of a London company called GlobalData. And they're seeing increased interest in the use of drones for a wide range of applications. They're calling it disruptive technology, which drones are. And what we think about in logistics is using those, using drones for delivery. And that's certainly happening. But they're also seeing increased interest in using them for other areas, getting people back to work and things like that. Ensuring social distancing, conducting temperature checks of employees, to make sure everyone's healthy. Using them to spray disinfectants, and for surveillance and monitoring for security issues and things like that. So we're seeing increased interest, and in the industry, we're also seeing some actual applications. UPS and CVS I believe began this month doing delivery, drone delivery, of medicine in Florida, prescriptions. And Ben actually had reported on another situation, I think it was back in March or February. A Chinese company, JD Logistics, was also beginning, or starting to think about, using drones for delivery of medicines and medical supplies. So it'll be an interesting thing to watch for sure.
David Maloney, Editorial Director, DC Velocity 10:08 Yeah, certainly will be. And Ben, you wrote this week about how retailers during Covid-19, during this whole disruption, are distinguishing less between their different inventory streams. Can you explain?
Ben Ames, Senior News Editor, DC Velocity 10:20 Yes, sure thing. And actually, one of the sources for this story, was an executive at JD Logistics as well, as Victoria had just mentioned, with a different story. What he was talking about, he's a man named Bing Fu, who's head of strategy at JD Logistics, which is a large Chinese e-commerce marketplace. And he was talking about how the crisis, the health crisis, has really accelerated some of the changes that people have been seeing coming slowly in the market for some time now. In a word, it's omnichannel. More specifically, I think a lot of us, as private consumers, have seen some changes during the health crisis in the big rise in curbside pickup, for example, even when you just get takeout for dinner from your favorite restaurant. But that's true in a number of stores as well. There's Kroger, which is a large grocery store; Best Buy the electronics retailer; Bed Bath & Beyond--housewares retailer; Container Store, another one. So we see a lot of major names in the industry moving quickly toward something that's been called "Dark Stores," which is, you have the whole building full of employees, full of inventory, but no shoppers allowed in. They bring all the orders to the curb there. And it's one of those things that is certainly being accelerated. We'll have to keep on watching to see if it sticks around.
David Maloney, Editorial Director, DC Velocity 11:39 Yeah, I imagine that we'll have that kind of a setup, I think, within retail stores, for quite some time to come yet, at this point. So it'd be interesting to watch. Ben, we also want to remind listeners of some of our great Covid-19-related resources that we have available on DCVelocity.com. Can you talk a little bit more about that?
Ben Ames, Senior News Editor, DC Velocity 11:58 Yeah, thanks, Dave. We sure do. We have a landing page where we have collected all of our Covid coverage for, it's been eight or nine weeks now. We've been writing an enormous number of stories, so that's a major resource on the site. And then we also have a page that lists all of the specific Covid-related resources that people specifically in the logistics field are offering, whether they're industry groups or vendors or government organizations. So that's a good first stop for anybody who's looking to dig in to find some more details here.
David Maloney, Editorial Director, DC Velocity 12:34 Right. And to learn more, you could go to DCVelocity.com/covid19resources. DCVelocity.com/covid19resources. Thanks to Ben and Victoria for sharing highlights of the news this week.
Ben Ames, Senior News Editor, DC Velocity 12:47 Thanks, Dave.
Victoria Kickham, Senior Editor, DC Velocity 12:48 Thank you.
David Maloney, Editorial Director, DC Velocity 12:49 And if you'd like more information on the stories we discussed today on Logistics Matters, be sure to check out DCVelocity.com for more details. And please provide any comments or feedback that you'd like to give us on our new podcast by emailing us at podcast@dcvelocity.com. And a reminder that Logistics Matters is sponsored by Fortna. Fortna partners with the world's top brands to transform distribution operations into competitive advantage. Expertise equals distribution strategy, DC operations, micro fulfillment, automation, and intelligent software. Distribution solutions designed today for tomorrow's challenges. Learn more about the distribution experts at Fortna.com. We'll be back next week with another edition of Logistics Matters, when we will discuss how to create a culture of safety within your operations. Until then, have a great week and please stay safe.
A move by federal regulators to reinforce requirements for broker transparency in freight transactions is stirring debate among transportation groups, after the Federal Motor Carrier Safety Administration (FMCSA) published a “notice of proposed rulemaking” this week.
According to FMCSA, its draft rule would strive to make broker transparency more common, requiring greater sharing of the material information necessary for transportation industry parties to make informed business decisions and to support the efficient resolution of disputes.
The proposed rule titled “Transparency in Property Broker Transactions” would address what FMCSA calls the lack of access to information among shippers and motor carriers that can impact the fairness and efficiency of the transportation system, and would reframe broker transparency as a regulatory duty imposed on brokers, with the goal of deterring non-compliance. Specifically, the move would require brokers to keep electronic records, and require brokers to provide transaction records to motor carriers and shippers upon request and within 48 hours of that request.
Under federal regulatory processes, public comments on the move are due by January 21, 2025. However, transportation groups are not waiting on the sidelines to voice their opinions.
According to the Transportation Intermediaries Association (TIA), an industry group representing the third-party logistics (3PL) industry, the potential rule is “misguided overreach” that fails to address the more pressing issue of freight fraud. In TIA’s view, broker transparency regulation is “obsolete and un-American,” and has no place in today’s “highly transparent” marketplace. “This proposal represents a misguided focus on outdated and unnecessary regulations rather than tackling issues that genuinely threaten the safety and efficiency of our nation’s supply chains,” TIA said.
But trucker trade group the Owner-Operator Independent Drivers Association (OOIDA) welcomed the proposed rule, which it said would ensure that brokers finally play by the rules. “We appreciate that FMCSA incorporated input from our petition, including a requirement to make records available electronically and emphasizing that brokers have a duty to comply with regulations. As FMCSA noted, broker transparency is necessary for a fair, efficient transportation system, and is especially important to help carriers defend themselves against alleged claims on a shipment,” OOIDA President Todd Spencer said in a statement.
Additional pushback came from the Small Business in Transportation Coalition (SBTC), a network of transportation professionals in small business, which said the potential rule didn’t go far enough. “This is too little too late and is disappointing. It preserves the status quo, which caters to Big Broker & TIA. There is no question now that FMCSA has been captured by Big Broker. Truckers and carriers must now come out in droves and file comments in full force against this starting tomorrow,” SBTC executive director James Lamb said in a LinkedIn post.
The “series B” funding round was financed by an unnamed “strategic customer” as well as Teradyne Robotics Ventures, Toyota Ventures, Ranpak, Third Kind Venture Capital, One Madison Group, Hyperplane, Catapult Ventures, and others.
The fresh backing comes as Massachusetts-based Pickle reported a spate of third quarter orders, saying that six customers placed orders for over 30 production robots to deploy in the first half of 2025. The new orders include pilot conversions, existing customer expansions, and new customer adoption.
“Pickle is hitting its strides delivering innovation, development, commercial traction, and customer satisfaction. The company is building groundbreaking technology while executing on essential recurring parts of a successful business like field service and manufacturing management,” Omar Asali, Pickle board member and CEO of investor Ranpak, said in a release.
According to Pickle, its truck-unloading robot applies “Physical AI” technology to one of the most labor-intensive, physically demanding, and highest turnover work areas in logistics operations. The platform combines a powerful vision system with generative AI foundation models trained on millions of data points from real logistics and warehouse operations that enable Pickle’s robotic hardware platform to perform physical work at human-scale or better, the company says.
Bloomington, Indiana-based FTR said its Trucking Conditions Index declined in September to -2.47 from -1.39 in August as weakness in the principal freight dynamics – freight rates, utilization, and volume – offset lower fuel costs and slightly less unfavorable financing costs.
Those negative numbers are nothing new—the TCI has been positive only twice – in May and June of this year – since April 2022, but the group’s current forecast still envisions consistently positive readings through at least a two-year forecast horizon.
“Aside from a near-term boost mostly related to falling diesel prices, we have not changed our Trucking Conditions Index forecast significantly in the wake of the election,” Avery Vise, FTR’s vice president of trucking, said in a release. “The outlook continues to be more favorable for carriers than what they have experienced for well over two years. Our analysis indicates gradual but steadily rising capacity utilization leading to stronger freight rates in 2025.”
But FTR said its forecast remains unchanged. “Just like everyone else, we’ll be watching closely to see exactly what trade and other economic policies are implemented and over what time frame. Some freight disruptions are likely due to tariffs and other factors, but it is not yet clear that those actions will do more than shift the timing of activity,” Vise said.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index indicating the industry’s overall health, a positive score represents good, optimistic conditions while a negative score shows the inverse.
Specifically, the new global average robot density has reached a record 162 units per 10,000 employees in 2023, which is more than double the mark of 74 units measured seven years ago.
Broken into geographical regions, the European Union has a robot density of 219 units per 10,000 employees, an increase of 5.2%, with Germany, Sweden, Denmark and Slovenia in the global top ten. Next, North America’s robot density is 197 units per 10,000 employees – up 4.2%. And Asia has a robot density of 182 units per 10,000 persons employed in manufacturing - an increase of 7.6%. The economies of Korea, Singapore, mainland China and Japan are among the top ten most automated countries.
Broken into individual countries, the U.S. ranked in 10th place in 2023, with a robot density of 295 units. Higher up on the list, the top five are:
The Republic of Korea, with 1,012 robot units, showing a 5% increase on average each year since 2018 thanks to its strong electronics and automotive industries.
Singapore had 770 robot units, in part because it is a small country with a very low number of employees in the manufacturing industry, so it can reach a high robot density with a relatively small operational stock.
China took third place in 2023, surpassing Germany and Japan with a mark of 470 robot units as the nation has managed to double its robot density within four years.
Germany ranks fourth with 429 robot units for a 5% CAGR since 2018.
Japan is in fifth place with 419 robot units, showing growth of 7% on average each year from 2018 to 2023.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."