Author Archives: Craig Huber

HUB GROUP EXPANDS ITS SUPPLY CHAIN SERVICE OFFERING WITH THE ACQUISITION OF LAST MILE LOGISTICS PROVIDER NONSTOPDELIVERY, LLC

Hub Group, Inc. acquires non-asset based Last Mile logistics provider NonstopDelivery, LLC (“NSD”); enhances end-to-end solutions for its customers in one of the fastest growing sectors of the transportation market.

Transaction Highlights

  • NSD is a market leading provider of last mile solutions for many large retailers
  • Expands Hub Group’s solutions offering with a complementary, value-added residential Last Mile service capability
  • Provides unsurpassed levels of service and an exceptional home delivery customer experience
  • NSD’s talented senior leadership team will remain with the business
  • NSD provides its service on a nationwide basis through a non-asset business model
  • Anticipated to be accretive to Hub Group’s earnings in 2021

OAK BROOK, Ill., December 9, 2020 (GLOBE NEWSWIRE) — Hub Group, Inc. (NASDAQ: HUBG) announced today that it has acquired NonstopDelivery, LLC (“NSD”), a leading last mile logistics provider.  Founded in 2000, NSD’s delivery network includes over 170 agent locations, which enables service to all U.S. zip codes. The acquisition of NSD adds a complementary residential Last Mile service capability to Hub Group’s solutions offerings.

“This acquisition delivers on our strategy to expand our offerings to provide an end-to-end solution for our customers’ supply chains. We expect there will be significant opportunities to offer NSD’s high service last mile delivery solutions to Hub’s customer base,” said Dave Yeager, Hub Group’s Chairman and CEO. “We are excited to welcome NSD’s employees, customers and agents into the Hub Group family.”

NSD provides basic, threshold and white glove last mile delivery services including warehousing and distribution, product assembly and reverse logistics to many of the largest retailers and manufacturers in the U.S.  NSD operates a non-asset business model, working with a network of agents throughout the country. With NSD’s logistics technology, customers receive real-time visibility to shipments, have access to advanced analytic tools and seamlessly integrate with other platforms.  NSD also prides itself in providing the highest levels of service to customers and consumers with a centralized Customer Care call center and dedicated Account Management teams.  NSD’s main offices are in Chantilly, VA.

“The NSD team is thrilled to join Hub Group,” said Steve Senkus, CEO and founder of NSD. “Hub Group and NSD have been working together for over 10 years managing our customers’ middle mile logistics needs. We share a culture of service, integrity and innovation, providing a strong foundation for our two companies to come together to create additional value for our customers.”

Winston & Strawn LLP served as lead legal counsel to Hub Group on the transaction. Stifel and Scudder Law Firm, P.C., L.L.O.  acted as financial advisor and legal counsel, respectively, to NSD on the transaction.

CONFERENCE CALL

Hub Group will hold a conference call at 10:00am Eastern time on December 9, 2020 to discuss the transaction. Hosting the conference call will be Dave Yeager, Chief Executive Officer. Also participating on the call will be Phil Yeager, President and Chief Operating Officer, and Geoff DeMartino, Chief Financial Officer.

The call is being webcast and can be accessed through the Investors link on Hub Group’s web site at www.hubgroup.com. The webcast is listen only. Those interested in participating in the question and answer session should follow the telephone dial-in instructions below.

To participate in the conference call by telephone, please dial 888-771-4371 approximately 10 minutes prior to the call and provide Conference ID 50036717.  The call will be limited to 60 minutes including questions and answers.

An audio replay will be available through the Investors link on Hub Group’s web site at www.hubgroup.com. This replay will be available for 30 days.

 

FORWARD LOOKING STATEMENTS: Statements in this press release that are not historical, including statements about Hub Group’s, NSD’s or management’s earnings guidance, intentions, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain and subject to risks and should be viewed with caution. Forward-looking statements may contain words such as “expects”, “expected”, “believe”, “projected”, “estimate”, or similar words, and are based on management’s experience and perception of historical trends, current conditions, and anticipated future developments, as well as other factors believed to be appropriate. We believe these statements and the assumptions and estimates contained in this release are reasonable based on information that is currently available to us. Such statements should be viewed with caution. Actual results or experience could differ materially from the forward-looking statements as a result of many factors. Factors that could cause actual results to differ materially include the integration of any acquisitions and expenses relating thereto, the future performance of Hub Group’s business lines, the amount and timing of strategic investments by Hub Group, the failure to integrate critical information technology systems, retail customers encountering adverse economic conditions, the impacts of the COVID-19 pandemic and the factors listed from time to time in Hub Group’s SEC reports including, but not limited to, the annual report on Form 10-K for the year ended December 31, 2019 and quarterly reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020.  Hub Group assumes no liability to update any such forward-looking statements.

 

ABOUT HUB GROUP: Hub Group offers comprehensive transportation and logistics management solutions. Keeping our customers’ needs in focus, Hub Group designs, continually optimizes and applies industry-leading technology to our customers’ supply chains for better service, greater efficiency and total visibility. As an award-winning, publicly traded company (NASDAQ: HUBG) with $3.7 billion in revenue, our 5,000 employees across the globe are always in pursuit of “The Way Ahead” – a commitment to service, integrity and innovation. For more information, visit  https://www.hubgroup.com.

 

ABOUT NONSTOPDELIVERY: NSD’s mission is to be the very best transportation logistics provider in the U.S. and the recognized leader in home delivery solutions. NSD is committed to providing superior customer service, operational excellence, and value-added solutions. We do this by continually investing in our team members, our delivery partners and our technology. Our almost 20 years of experience and expertise is built on our dedication to delivering an exceptional home delivery experience.

Contact: Hub Group Inc., Maralee Volchko  630.271.3745

NSD is proud to be named in the Top 100 Great Supply Chain Partners for 2020 by SupplyChainBrain!

 

For 18 years running, SupplyChainBrain has published our much-anticipated list of 100 Great Supply Chain Partners — a select group of companies whose customers recognize them for providing outstanding solutions and services.

Our six-month online poll of supply chain professionals requires specific criteria to nominate vendors and service providers whose solutions have made a significant impact on their company’s efficiency, customer service and overall supply chain performance.

This year’s field of nominees was competitive and inspiring -coming from all sectors of supply chain management. Your company should be proud to be named amongst the 100 Great!

NSD will appear in the 2020 August issue of SupplyChainBrain magazine and on SupplyChainBrain.com as an honored member of this year’s 100 Great Supply Chain Partners.”

~ Brad Berger, Publisher, SupplyChainBrain

How To Keep Order Fulfillment Flexible This Peak Season

Convey’s AMA Partner Blog with NSD

 

Due to COVID-19, the retail landscape has completely changed, leapfrogging eCommerce expectations by over two years. According to Convey’s data of over 4B eCommerce events, shipment volume in May increased by 49% YoY.  Although eCommerce delivery has changed and shoppers have become more forgiving of delivery issues, one thing has not changed: Consumer expectations are still high, and many third-party carriers are working through peak season volume every day to help get packages delivered on time.

The following is the transcript of Convey’s interview with Scot Goodwin, our Senior Vice President of Sales. He discusses how carrier dynamics have shifted since the beginning of COVID-19, why carriers play such a large role in delivering on last mile customer expectations, and how retailers can maintain flexibility in order fulfillment and delivery.

Tell us a little bit about you and your role at NSD.

My name is Scot Goodwin, and I am the Senior Vice President of Sales at NSD. I have been married 22 years to my wife Clare and have 3 children. I enjoy spending time with the family, going to the beach, golfing, and anything involving football. I have been in transportation/logistics for 25 years and have spent the last 6 years at NSD. I manage our sales division and work with my team to develop our strategy for company growth. Our customers include the world’s largest retailers, and it has been exciting to work with them to develop solutions as their businesses continue to evolve.

How do you see retail and supplier roles shifting as consumer expectations continue to increase?

COVID-19 has caused a shift in buying modes. With more items being purchased online due to limited store access, the supplier is playing a greater role in the customer experience. In home delivery, the supplier must have the capacity to handle volume surges. Their technology has to be robust and flexible to accommodate changes in service levels and provide the retailer and the customer real-time status updates.

Let’s face it, today, the experience is not the interaction with the store associate, but the speed a carrier can deliver and the amount of information and options they can offer the consumer. The retailer is relying more than ever on its supplier’s ability to execute, communicate with the consumer, and create customer loyalty.

How do your customers think about creating a consistent last mile experience?

The world has changed over the last 60 days. The safety of consumers and delivery teams has moved to the top of the priority list. In-home delivery service is suspended. In this new environment, there are requirements for drivers wearing personal protective equipment and practicing social distancing.

Adding safety measures to the delivery process is critical, but the main elements of a consistent last mile delivery experience have not changed. It is still about how fast you can get the product to the consumer, keeping them updated and informed on the delivery, ensuring their order arrives defect-free, and providing a cost-effective solution. It is important for the retailer and carrier to continually re-evaluate and update the customer communication plan and SOW.

With all of the supply chain disruption related to COVID-19, what’s the number one thing that retailers should be aware of?

The companies that are having the most success right now are those organizations that have invested in technology, have strong eCommerce platforms, are diversified in their supplier and carrier base, and offer multiple methods for customers to receive goods. They also have clear and concise messaging to their customers throughout their order lifecycle.

Do you have any advice to combat this?

I know companies have limited IT investment dollars and resources, but where possible, these should be directed to support eCommerce. To be competitive, you will need to offer a variety of services like curbside pick-up, store-to-home, DC-to-home, and vendor direct options for consumers. They need to protect themselves from an unplanned store or facility closure. Also, they must develop clearly defined expectations and touchpoints with customers to proactively inform them of shipment status and potential delays or exceptions.

What should retailers do now to prepare for upcoming supply shortages?

Successful retailers are able to manage order fulfillment from stores, DC’s, and vendors. A good strategy would be to look at diversifying your vendor base and adding vendors with similar products. There should be a focus on adding as many products as possible for online ordering. Take advantage of the ability of your vendors to ship directly to the consumer and avoid extended customer delays due to shifting inventory.

What should retailers do to prepare for eventual re-opening?

I live in the greater NYC area and wanted to share my personal experience. When I go out shopping today, my safety and security have become a primary factor in my retailer choices. I have been to a store that limits the number of people allowed, has one-way aisles, floor markings for social distancing, wipes, and sanitizers available, as well as a contactless checkout. I have also been to one of their competitors that does not take the same level of safety precautions. When I have the option, I will patronize the stores that seem to make their customers’ and employees’ health a priority.

What things have changed that you think will stick around once this is all behind us?

Specific to home delivery, there will be new basic requirements for entering a customer’s home. Driver teams will have to wear masks and gloves, use hand sanitizer and wipes, offer the customer a no-contact POD, and need to confirm inside delivery during the scheduling process. I think these additional measures to protect our drivers and customers are here to stay.

Do you have any additional advice to share?

With the many unknowns regarding the impact of this virus on long term customer buying behavior and future economic strains, flexibility in order fulfillment and shipping is going to be extremely important for the retail industry. In the past, there was always the debate of the asset versus non-asset model.

I can tell you that the benefits of an asset-light model have served us well over the last several weeks. We have experienced significant volume increases while maintaining high levels of performance. I think retailers should be open to exploring all carrier options at this time to further prepare their supply chain solutions for what is currently happening as well as what we may see for holiday peak season this year.

Special Thanks go to Convey and Christina Singh for facilitating the interview with Scot. This ‘Ask Me Anything’ piece is a blog in their partner series on supply chain resilience during and after the COVID-19 outbreak. Blog Link

About Convey: Convey’s Delivery Experience Management platform combines real-time visibility, post-purchase experiences, and advanced insights and analytics to create a solution uniquely capable of perfecting last mile delivery. getconvey.com

Please welcome William Claesen!

NSD is pleased to welcome William Claesen as our new Senior Director of Transportation. William has over 20 years of industry experience within 3PL operations. Across his career, William has been engaged with overall program management and logistics strategy development for a variety of client transportation methods including parcel, linehaul and truckload. In addition, William has led efforts to provide on-going industry educational seminars and formal presentations relative to industry outlook projections for managed clients. We are confident he will bring tremendous value to our company and our customers!

 

How logistics automation can transform the transportation industry in 2020

By Craig Huber, CIO/CTO of NSD

When you pick up a piece of produce at the supermarket, have you considered all of the steps it took to get from the farm to your hand? The same goes for the couch you ordered online. How exactly did it get to your doorstep? Through a complex network of logistics providers. From hand-to-hand and truck-to-truck, the items you buy have likely been on an extensive journey, requiring serious manpower, tracking, accountability, and context switching (both physically and in business systems). Upon the start of a new decade, what can transform the lives of these workers and help them avoid tedious, manual days? The answer: logistics automation and integrations. 

With more than 20 years of supply-chain experience, I have continuously looked for ways to transform the logistics industry using technologies like automation to improve traceability and visibility of freight, as well as how different carriers communicate in the arena of last-mile logistics. I’ve also looked at how blockchain has transformed the supply chain industry and what smaller shipping companies can do to stay competitive with automation.

Areas for Improvement 

 

Inconsistent Communication 

In order to get the right products to the right places in a timely manner, workers have to physically (with hard labor) and manually collaborate through disparate systems to move shipments. Unfortunately, for the hundreds of companies moving shipments all over the country via less than truckloads (LTL) or full truckloads (FTLs), communication has been complex. 

No one communicates in the same manner. There are hundreds, if not thousands, of trucking carriers in the US and most of them don’t speak the same language.  It can be quite frustrating.

Lack of Visibility  

Being able to trace the movement of freight from origin to final destination is extremely important for logistics companies, especially when problems arise. Imagine having a product leave your warehouse, and somewhere along the line it is lost or damaged, but you have no idea where or when it took place? Being able to trace the paths of different products may seem difficult, but not impossible, as we’ll see from Walmart below.  

Expectations Around Speed 

Consumers’ expectations of delivery speed has changed dramatically in the past few years.  Retailers like Walmart and Amazon are constantly pushing the boundaries of what is possible. On-demand tracking and delivery has become the norm, meaning that smaller logistics companies are pressured to take heed. Due to the lack of resources compared to these larger companies, however, smaller players may seem to be at a disadvantage, but can turn the tide with technologies like automation.

The Golden Ticket: Blockchain?   

Walmart x Blockchain 

By introducing blockchain concepts into the retail sector, Walmart has attempted to solve the transparency problem around food supply. What they’re hoping to do is maintain complete traceability of food items from the raw source in the ground to the store shelf. What exact path did a crate of lettuce take, for example, to get to a store? 

Walmart asked some of their suppliers to join in using blockchain to trace produce all the way back to farms, so if there’s an outbreak or some unfortunate event, they want to be able to trace it back to its origins quickly.

The Good and Bad of Blockchain

From my understanding, the theory behind the blockchain is that nobody owns or controls it. Suppliers can, in theory, look at it and contribute their information to it. It is immutable, or unchangeable, and distributed. One main principle is that there is no single database that Walmart holds – it’s a chain of events, or a public viewpoint on a specific product.

Extrapolating Walmart’s usage, blockchain could provide logistics companies with similar visibility across all product movements, and provide the same level of visibility for every single product that moves in the world. This is a tall order, however, as potentially tens of thousands of companies would need to agree to a standard. A company like Walmart can request suppliers do this on a smaller scale, but to do so at an expanded level would be a bit more complicated, even for Walmart.

In the meantime, smaller companies can keep their edge and move and trace products  increasingly faster with APIs and automation.

 

Staying Competitive With Logistics Automation

Since joining NSD as CIO/CTO in 2017, my team and I have considered using automation for last-mile logistics in several unique ways. 

Solving for Visibility 

To improve upon shipment visibility, NSD allows their customers to track and trace shipments against an internal system via an integration with our automation platform. We’ve done this by using third-party APIs from our partners to connect them to NSD’s transportation management system, which acts like an ERP (or if the partner doesn’t have an API, they can create one using a HTTP or SDK connector). That way, both NSD and our partners can get insights on the movement of shipments. Additionally, when the status of a shipment changes, NSD can immediately alert the designated party via those API connections.

Solving for Time 

By using automation, NSD has also been able to reduce a great deal of manual, repetitive tasks. For example, many logistics carriers we work with have portals available for tracking their cargo, but no API connectivity. With our automation platform, we were able to connect carrier portals to our platform and automatically pull the appropriate tracking information when needed. 

Cutting Development Costs and Accelerating Time-to-Market 

If you are running the business systems of a logistics company, the real question is: where should you start with automation? What business goal would you like to achieve? Would you like to handle more orders with the same amount or less FTEs? If automation could turn one of those answers into a yes, it could be worth exploring. 

Also, you have to consider your development costs.  Does implementing and adopting an automation platform cost less than having workers manually complete these processes, which prevents them from doing more value-added tasks? 

Looking at both productivity and cost of adopting an automation vendor (and the resources needed to train staff) can factor into what you actually automate. In our case, the use of an automation platform helped to cut down both our development costs and time to market. Very quickly, we were up to speed on how to use the platform and creating automations due to its ease of use with both smart business users and developers. Instead of requiring highly-trained integration specialists, we were able to hire solid business analysts and with the right training, moved ahead pretty quickly with our integrations. 

Much of the behind-the-scenes work we were trying to do would’ve involved custom code to get done. But with a low-code automation tool, we were able to test much, much faster and set up the backend monitoring management of our work that would’ve involved custom coding. That was one of the first use cases we tackled once we selected an automation vendor because we had a very clear need and didn’t have another way to solve it.

Overall Logistics Improvements For 2020

At the end of the day, the logistics industry is ripe with opportunities. With the introduction of logistics automations, API developments and possibly blockchain, logistics companies can work to both increase speed and visibility and keep customers happy while also improving communication with partners and user experience (how they communicate). Starting with small use cases like reducing documentation errors with automatic data transfer between apps (either internally or from partner to partner) can amplify the productivity of many logistics processes and improve employee experience. It’s a new decade where the logistics industry can thrive, if given the chance to. 

 

About the Author: 

Craig Huber is the CIO and CTO of NSD, a leading last mile logistics provider.  With 20+ years of technology experience in supply chain logistics,  Craig has shaped the internal technology of companies like Walmart, Dell, and CaseStack, and now NSD.

NSD Awarded The Home Depot Carrier of the Year

NSD is honored to be awarded The Home Depot’s 2019 Online Big and Bulky Home Delivery Carrier of the Year for the second time in the past four years. Congratulations to the entire NSD team for Going the Extra Mile!