This Week in Logistics News (May 9 – 15)

supply chain newsAs the world continues to turn during the coronavirus pandemic, we are all adjusting to the new normal. However, what that new normal will ultimately look like is still an unknown. But for now, there are certain things that we are getting used to, such as social distancing and wearing face covers. But how will businesses adjust to the new normal? I’ve seen a bunch of articles this week about what businesses are considering. According to the CEOs of Burger King and Popeyes, face masks may become part of the new uniform. Tim Hortons will widen the space between tables and sanitize them, as well as chairs, after each use. It will also limit the number of customers allowed at any given table to no more than four. Retail stores will also have to adjust accordingly, with wider aisles, face coverings, and better sanitation. Things will continue to evolve and so will our new normal. But for now, let’s move on to this week’s logistics and supply chain news.

supply chain newsA couple of weeks ago, my colleague Steve Banker wrote an article about companies using virus killing robots in plants and warehouses. According to the article, “UV light, at a particular wavelength, has a germicidal effect. The light energy destroys the DNA structure of all microorganisms.” The robots have been around for 50 years, mainly used in sewage plants. But, with COVID-19 disrupting the global economy, interest in the robots is gaining traction. In a segment on 60 Minutes, Amazon showed a video of a robot it is developing that would roll through grocery stores and distribution centers, using banks of ultraviolet light to kill viruses on surfaces. This was the first glimpse of the technology that the company has previously hinted at. The segment describes Amazon’s UV-emitting robot as “something they’re working on for the future,” without providing a timeline or other details.

supply chain newsAmazon apparently sees the light at the end of the tunnel and has said that one and two-day deliveries that customers have come to expect should return in the coming weeks. The company has implied that it has caught up from the demand surge that stemmed from the coronavirus outbreak. Amazon has lifted restrictions on the amount of inventory that suppliers can send to its warehouses. With more on-hand inventory, orders can be turned around quicker and meet the one and two-day delivery timeframes. The ability to revert to the quicker timeframes brings about two key benefits. First, customers that were seeing long delivery times and looking elsewhere will likely come back. And second, with reduced delivery timeframes, there is less chance of merchants defecting from its logistics service.

Coronavirus has put added stress on the global supply chain, and as mentioned above, has put added strain on delivery capacity. As a result, FedEx has limited the number of items that retailers can ship from certain locations such as stores. COVID-19 has brought about a surge in online shopping that rivals the holiday season. Shippers and carriers plan well in advance for the holiday surge; there was not time to plan for the coronavirus surge, however. In order to ensure that its network is not overwhelmed, the company has put these limits on a number of retailers that had turned stores into mini warehouses to fulfill online orders. The limits vary at each location and are only temporary. The list of retailers includes Kohl’s, Belk, Neiman Marcus, Nordstrom, Abercrombie & Fitch, Bed Bath & Beyond, Hobby Lobby, Eddie Bauer, and other sellers like Groupon and Young Living Essential Oils.

The Centers for Disease Control and Prevention (CDC) has issued guidelines tailored to help long-haul truck drivers and their employers deal with the COVID-19 pandemic. The majority of the guidelines echo what the CDC has recommended for the general population since the outbreak first hit such as social distancing, proper and frequent hand washing, and the use of personal protective equipment. However, it also offers specific guidelines aimed at truckers, such as frequent cleaning and disinfecting of the driver door handle, steering wheel, seat belt and buckle, arm and headrest, seat covers, turn signals, wiper controls, dashboard, air ducts, radio, and temperature controls. In the sleeper berth, light switches, mattress trays, temperature controls and other flat surfaces should be cleaned frequently as well. The complete list of recommendations can be found here.

Federal regulators have extended broad exemptions from hours-of-service (HOS) rules for drivers hauling freight deemed essential during the COVID-19 pandemic until June 14. Carriers and drivers hauling freight that supports COVID-19 relief efforts have been granted emergency relief from Parts 390 through 399 of federal motor carrier regulations, which includes HOS rules. The exemption was soon expanded to include raw materials and other cargo considered essential to coronavirus pandemic relief. This extension marks the second extension by the Federal Motor Carrier Safety Administration (FMCSA). The original extension would have expired today.

As consumers are still trying to avoid stores as much as possible, Walgreens is bringing a fast food fulfillment model to some of its pharmacies. The company is bringing its buy online, pick up in store operation for a limited selection of products to its 7,300 pharmacies that have drive thrus. The selection includes more than 100 items such as cleaning supplies, paper goods, over-the-counter medicines, first aid supplies, and baby formula. The number of products has increased from 60 in March, although these items could not previously be pre-ordered online. A Walgreens spokesperson said customers are not required to have a prescription in order to use the new drive thru pickup service. However, a press release noted pricing for drive-thru orders may differ from in-store items.

Walgreens isn’t the only company expanding its prescription fulfillment services. Publix is expanding its home delivery options as well. The company already has a partnership with Instacart for curbside and home delivery. But, in a new partnership with ScriptDrop, Publix is offering home delivery of prescriptions. The partnership offers prescription delivery within a 5-mile radius of each in-store Publix Pharmacy. The service comes with a $5 fee, but there is no limit on the number of prescriptions ordered. Deliveries take place on weekdays after 2 PM, and to receive same-day delivery, orders must be placed by 11 AM. Customers who receive a text message when prescriptions are ready will receive a link to prepay for their prescriptions and choose delivery. Age-restricted products, controlled substances and prescriptions needing refrigeration are excluded.

As home delivery continues to heat up, Uber is looking at ways to expand its business. The company reportedly has made an offer to acquire meal delivery company Grubhub. An acquisition would certainly raise Uber’s profile in the food delivery space alongside its UberEats platform. Grubhub has been around since 2004 but has seen the competition increase in recent years as Uber, Postmates, and DoorDash all took off. While an Uber spokesperson said the company does not comment on merger and acquisition rumors or speculation, Uber’s stock was up 8 percent and Grubhub’s was up 35 percent following the reports.

And finally, as companies try to compete with Amazon-like experiences, opportunities abound for start-ups. DispatchTrack, which provides a platform for last-mile deliveries specifically to help companies mimic Amazon-like experiences for themselves by planning and tracking deliveries more easily, has closed a $144 million funding investment. This is the company’s first ever funding and it all comes from a single investor – Spectrum Equity. DispatchTrack was founded in 2010 and has since grown to support more than 60 million deliveries per year. DispatchTrack includes features for managing routing and planning (including telematics and compliance), customer communication (including reservation systems for delivery slots), driver communication (via a mobile app), billing, social reviews and omnichannel order tracking.

That’s all for this week. Enjoy the weekend and the song of the week Ten Years After’s I’d Love to Change the World.

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