Blog postsMay 17, 2019
FLEXE Hub: Throwing down the gauntlet
A roundup of the latest news on logistics, retail, and industry trends
There’s a lot going on in the retail and logistics industries right now. Keeping up with the latest store closures, emerging tech, and what Amazon is doing could easily be a full-time job. Luckily for you, it’s ours.
Each week, we curate the most interesting articles we’ve been reading. This week saw no shortage of news, with Amazon and Walmart both making major retail moves. We take a look at:
- Walmart’s next-day delivery announcement
- Nike’s new shoe-sizing tech
- Amazon snagging the world’s largest retailer title
Let’s talk logistics
Walmart comes for Amazon
Well, that happened fast. Just weeks after Amazon announced Prime one-day shipping, Walmart revealed it’s rolling out free, next-day shipping on orders of $35 or more. At first glance, this seems like a one-up on Amazon, which requires customers to pay $119 a year for a Prime membership. But Walmart is only offering this free service on 220,000 of its items, at least initially.
Chief executive of supply-chain software and consulting firm enVista, Jim Barnes, warns that other retailers shouldn’t necessarily attempt to follow suit—retailers are trying to achieve “same-day shipping when they have fundamental issues around where inventory is sitting in the supply chain.” Beyond that, if your customers aren’t asking for it, increasing your shipping speed may not even benefit your business. For retailers, the most important thing is to offer a delivery promise you can actually deliver on.
It’s not you, it’s your supply chain
In February, Gap Inc. announced that it would be splitting into two publicly traded companies with Old Navy spinning off from the rest of the Gap family which includes Banana Republic, Athleta, Intermix, and Hill City. Old Navy had outgrown its fellow brands, and due to its focus on turning around cheap clothing quickly, they needed a supply chain that could be more responsive than the others.
But, much like dividing up assets in a divorce, separating their shared supply chain will come with some complications. According to Shay Scott, Executive Director of the Global Supply Chain Institute at the Haslam College of Business at the University of Tennessee, separating them will likely lead to some changes among the business relationships—"there are going to be cancellation clauses, relationships that are broken because of the change.” Other challenges for the two will be the division of supply chain talent, suppliers, providers, and even routes. Here’s hoping this ends amicably.
Article via Retail Dive
If the shoe fits
There hasn’t been a major development in shoe-sizing technology since 1925 when the Brannock Device (that metal thing you use at Footlocker) was invented. Nike is attempting to change that with Nike Fit—an app that scans customers’ feet to determine their perfect shoe size. This service can be used at home through the mobile app, or customers can go to a Nike store and have an associate help them.
In addition to solving a major pain point for its customer, this rollout will help Nike further push sales through its owned channels, minimize returns, and hopefully, motivate customers to buy more shoes if they know they are getting the right fit.
From an industry perspective, this gives further credence to the trend of custom fits and personalized sizing as a way to differentiate from the competition. As retail standards continue to rise, brands like ThirdLove, which specializes in half-cup-size bras, are using it as a way to provide next-level customer service and stand out from the crowd.
Article via CNBC
What’s Amazon up to?
Popping champagne over its latest wins. This week Amazon had a lot to celebrate. It broke ground on a new 3 million sq ft Prime Air hub at the Cincinnati/Northern Kentucky International Airport, its founder unveiled Blue Origin—a lunar lander project that aims to make its first mission in 2024—and it can now officially call itself the world’s largest retailer after snagging the title away from Walmart. Forbes named Amazon #28 in its Global 2000 list of the world’s biggest public companies—a 25-spot jump for the retailer. Walmart dropped five spots to #29.
Don’t count Walmart out just yet, though. As we mentioned above, they recently rolled out a competing one-day delivery promise, and still remain larger than Amazon in a couple of key areas like revenue (more than double that of Amazon’s), assets (they own a ton of real estate), and employees (2.2 million of them).
FLEXE news & events
Give me a “B!”
We’re thrilled to share that we raised $43 million in Series B funding. Our CEO and Co-Founder, Karl Siebrecht, talks business momentum and what’s next for FLEXE on the blog. Bloomberg and Geekwire also shared stories about our fundraising and the increased importance of on-demand warehousing in the wake of Amazon’s one-day delivery news.
Is your logistics network ready for the unexpected?
Find out how a flexible network future-proofs your warehouse and fulfillment operations in our latest blog post.