As e-commerce has seemingly taken over the world, it has forced traditional freight forwarders like Seko Logistics to rethink their logistics networks. When COVID-19 upended the world even further, it accelerated that thought process.
Brian Bourke, chief growth officer of Seko, spoke with Emma Cosgrove, senior transportation reporter for Business Insider, on Wednesday at the Home Delivery World 2021 conference at the Pennsylvania Convention Center in Philadelphia. Bourke’s big takeaway: The world is different.
“[We] had to start opening up facilities in California at the pace of about one a month it seemed,” Bourke said, noting that capacity is critical.
While the growth in e-commerce played a primary role in the need for more facilities, Bourke also said COVID impacted it as well as picking stations needed to be further apart in warehouses for safety reasons.
Saying “everything is about speed,” Bourke noted how Seko has added partnerships with technology companies like Bringg and Hurricane to help it expand its last-mile delivery services. It onboarded ACI Logistics in 2020 and “it seems we were giving them 30,000 packages a day from the start,” he said.
One of the biggest changes, though, has been the need to secure more capacity for its customers, and that means finding space on ocean carriers to help customers move goods into the country.
“I don’t want to be an ocean carrier. I’m good as a freight forwarder,” Bourke joked. But the need to move more parcels from overseas has meant looking for containers that may have space remaining when they leave Asia.
Seko has also seen its transload services business grow.
“We’ve always been doing transloads, but it was an ancillary service,” Bourke said. “But it’s now becoming a core [service] so our customers’ containers are not sitting in the ports for 30 days.”
Bourke returned to the opening of warehouses, saying that Seko has been expanding its network across the Southwest trying to keep up with demand.
“The entire Southwest has become a plethora of options so only the freight that needs to be in California stays in California,” he said.
Bourke also credited Seko’s foresight in signing leases early in the pandemic to get space in California, where available warehouse capacity sits under 2%.
Turning to the labor situation, Bourke said competition for warehouse labor continues to heat up, but Seko has seen some customers willing to pay labor surcharges to ensure the flex capacity is in place when it is needed.
“It gives us leeway to prepare for and staff correctly for those peaks,” Bourke said, adding that Seko has been using a combination of approaches to attract labor, including higher wages, signing bonuses and even updating cooling systems to improve the work environment.
Bourke also mentioned robots and the growing concept of “cobots,” or robots working side by side with humans to automate redundant tasks and allow the humans to improve productivity.
“A lot of people think robots are a threat,” he said. “We are looking at cobots that help people by not making them run around the warehouse.”
Bourke pointed to continued tech investments, mentioning Bringg specifically, that Seko is making to help it transition to a world where e-commerce parcels dominate.
“That investment in that [Bringg’s] technology has not only helped us deliver packages, but also data,” he said, adding that Seko is now able to bill and track at the parcel level where before it was at the pallet level.
“It’s still a challenge and we need to invest more,” Bourke said. “There will be a day, and it’s not too far off, when the majority of our deliveries will be parcel.”