Dennis Oates: 0:03

Let's become more efficient and how we deliver. It's good for the environment, and it meets the expectations of consumer. And so that's that kind of idea, I think will be interesting to see, you know, in the next, you know, 18 to 24 months of where that goes.

Tom Raftery: 0:20

Good morning, good afternoon or good evening wherever you are in the world. This is the digital supply chain podcast, the number one podcast focusing on the digitization of supply chain. And I'm your host, global vice president of SAP. Tom Raftery. Hi, everyone. Welcome to the digital supply chain podcast. My name is Tom Raftery with SAP and with me on the show today I have my special guest, Dennis. Dennis, would you like to introduce yourself?

Dennis Oates: 0:47

Yeah. Hi, Tom. My name is Dennis Oates. I'm the chief logistics officer at Sendle. At Sendle, we're the first 100% carbon neutral shipping carrier in the United States and Australia, specifically designed to serve the needs of small e commerce businesses.

Tom Raftery: 1:02

Okay, and why? Why Why is it important to you? And why is it important to Sendle to be a zero carbon delivery service?

Dennis Oates: 1:15

I you know, the mission at Sendle is about shipping that's good for the world. And, and I think there's a couple of things converging right now, you know, ecommerce is booming, you know, you've seen the acceleration that happened during COVID. And so as we continue to increase the amount of you know, shipment and activity in e commerce, it's putting pressure on in terms of, you know, the amount of the carbon footprint that comes along with it. And so I think, you know, we as a society have a responsibility to ensure that we're looking and understand what that means from a system sustainability aspect. And then the other piece of it is is is small business sometimes gets left behind in many of these conversations, you know, the majority of logistics providers are really built, you know, the traditional logistics providers are built for these larger retailers, or larger businesses, and sometimes a small business gets behind it. So that's, that's the gap where sindelle fits is how do we make sure that we leveled the playing field for the small businesses, as well as understanding that, you know, we have a mission, that's in addition to enabling that small business, but enabling in such a way that it's good for the environment.

Tom Raftery: 2:27

Okay, so does central make it its mission not just to be zero carbon, but also to work? I won't say exclusively, but Well, I'll say exclusively, exclusively with small businesses.

Dennis Oates: 2:44

So we definitely are small business focused in terms of who we, who our customers are. Our suppliers are a mix of different transportation providers throughout the, you know, Australia, in the United States. And so we've got a mix there of you know, small business as well as larger businesses, suppliers.

Tom Raftery: 3:02

Okay. But your your customers are, primarily will say, smaller businesses. Absolutely, yes. Okay. And how do you go about ensuring that your services are low carbon or zero carbon?

Dennis Oates: 3:16

Yeah, I think that's the way we look at it is there's there's a short term play, and then there's a longer term play, right? You're in the short term, it's more what can you do now. And the step that we've taken is we carbon, we do offsets for every shipment that we do. And so, you know, it's a, it's a pretty interesting kind of process that we use, both in the United States and in Australia. Every year, we go out to our shipping community, and we say, here are a number of different projects that we we would like to support as part of this, you know, initiative. And then we let those folks select where we're going to invest our resources. And so it's kind of interesting, because it gets folks in engaged with what we're doing in terms of the carbon offsets. Nice. So so that's step one, is that carbon offset, but really, the longer term goal is how do we reduce carbon intensity? And and the way I look at it is I think there's two folds to it. You know, one is, you know, as we look at ecommerce shipments, you know, what's the carbon emission per mile, and then also, for each e carbon shipment, what are the miles per shipment, right? And so if we can impact either one of those, we can impact the overall carbon emissions. And so from a carbon per mile standpoint, there's many interesting things happening there. Right. As e commerce has exploded, at the same time, the consumers expectation, especially in the United States has been we want faster deliveries, you know, and the major retailers are looking for those faster deliveries to compete against brick and mortar Right. I mean, at some point There's a trade off consumers make of while I wait for it or go down, you know, drive to my corner store and pick something up. And so, as that pressure comes, the carbon footprint increases, you know, you look at the modality of transportation and the carbon footprint associated with that, you know, air shipments, you know, it's a factor, you know, a factor of 10 greater than ground shipments. And so we just need to be careful, what does that mean from, you know, the carbon per mile. So there's a, how we look at modality as well as how we look at the actual equipment being used. And so that's also where electric vehicles and some of the other cool technology that's coming out plays in so that's, that's the carbon per mile, then there's also this miles per shipment aspect. Because if we can get smarter, and we can be better in terms of like efficiency, and routing and stuff like that, we can also drop the carbon emission there. And so we like to look at it as if we have routes and lanes and transportation, infrastructure that's being underutilized. If we can figure out how to better utilize the existing infrastructure, we can reduce our carbon footprint as well.

Tom Raftery: 6:10

Okay, and is this something that is important to your customers? And, you know, if so, how do you know,

Dennis Oates: 6:20

I think it definitely is important to the customers, I there was a an interesting IBM study that came out not too long ago, where they talked about six and 10, consumers are willing to change their shopping behavior to reduce reduce their environmental impact, we're seeing from our customer base, you know, when we do our surveys, and we and we've asked our customers, what's important to you, you know, we're getting a vast majority of the customers of pudding as one of their top, you know, two or three choices, as you know, the ecological impact of what they do. And so we're starting to see more and more, I think, in the United States that both consumers and then also shippers are recognizing that this is important for business, and that, you know, folks buying habits will be impacted by the choices they can have around ecological friendly options.

Tom Raftery: 7:13

Okay. This is something that, well, I know that you're competing against the likes of Amazon, for example, who have started their own kind of shipping with Amazon Prime. And I don't know what the situation is like in the US. But last year here in Spain, up until last year, Amazon had been using third party shipping companies, you never saw an Amazon branded delivery vehicle. And then last year, something changed, made it might have been pandemic related might have just been coincidental. But last year, they started using Amazon branded vehicles. And it's now more than norm than anything else that you get your your shipment from an Amazon branded vehicle. And all of those, about 80% of them are electric vehicles. So obviously, this low carbon shipping is not just important to Central and your customers, but big players are also getting into this space as well. Is this a? Do you think this is a validation of what you guys are doing?

Dennis Oates: 8:19

Yeah, I'll start off saying, you know, well done to Amazon, I love when I see some of these big retailers starting to take seriously sustainability. And so, you know, well done to Amazon, do

Tom Raftery: 8:31

FedEx, Amazon issued a, an order to buy 100,000 electric vehicles last year. I mean, that's, I'd love to have been the salesperson who took that order.

Dennis Oates: 8:45

Exactly. The, you know, and I, I say well done. And at the same time, I'm also like, I think Amazon also needs to, you know, take a look at what else they're doing in terms of ecommerce shipping. And so I think, especially in the United States, you know, the Amazon effect of that speed aspect of what they're doing, I think is huge. And so, you know, you and I think it's awesome that we're seeing more electronic electric vehicles out there. The flip side to it is as that speed goes up, Amazon is also buying many more aircraft, right, and they're increasing their air fleet. And so, you know, so you've got, in some ways, they're doing a lot of great things on the ground with how they're reducing the carbon emission with the fleet that they're bringing in, and they should be applauded for that. But then on the flip side of that is, there are some, you know, modality kind of aspects that they're bringing into place that are probably increasing the pressure in terms of like, you know, carbon intensity. So, like, I don't know where that trade off is. But I think it's interesting. It's something we should continue to watch.

Tom Raftery: 9:49

And, I mean, that's a trade off that anyone in that industry, yourselves included are facing, how are you guys dealing with that?

Dennis Oates: 9:57

That definitely is one, I think it's going to come down to Zoomers, right, and, and the consumer expectation. And so, you know, if you want, you know, anytime you bring constraints into a system, you know, you're going to make it less efficient, right. And so if I want something faster, and if I want something specifically in a window during the day, that's going to increase, you know, the carbon footprint of that package. The flipside of that is I think consumers, if they're educated, can start making decisions around. Well, do I need to have it this fast? Do I need to have two hour delivery? Do I need to have it next day? Or could I consolidate shipments and have a single day delivery? Right? And I think that's some of the things that we're talking about with centralist is, you know, speed is important. I mean, there's a minimum speed that everybody needs, but it might not be next day, and it might not be, you know, an hour window for a delivery. And so that's kind of the things that we look at is, is how do we match really what the consumers need, as opposed to just blindly saying the expectation is faster, faster, faster?

Tom Raftery: 11:02

And what about access to information? Because I know that I will get sometimes if I'm getting a delivery, I get an email saying the delivery is coming sometime tomorrow between 9am and 7pm. And I'm like, that's not really very useful. Now, working from home, I know, I'm going to be here anyway, it's unlikely I'll be out. But, you know, other companies will send you a link where you can track the delivery, and you can see, okay, it's left there, okay, it's left there, okay, it's, you know, and you can see it getting closer. And, you know, there are various in betweens there, where do cendol fall in that space,

Dennis Oates: 11:42

we definitely take into account all the notifications, and whether it's, you know, SMS notifications or, or other channels, I think that's a great convenience for consumers, right is to, you know, understand that, Hey, I know where my packages and give an expectation from a delivery standpoint, because, you know, from an efficiency standpoint, real deliveries aren't great, either, right? I mean, if I have to drive the same miles, you know, twice with a truck, or if I have to, you know, do an alternate delivery, and then the consumer has to, you know, there's a bad customer experience that comes out of that. Plus, there's also more miles that are being driven product shipment. And so I think any of those notifications, and any of that opportunity to be able to increase efficiency goes towards, you know, the point that we're trying to get across, which is, how do we make it, you know, shipping great for the world, both from a consumer experience as well as from a sustainability standpoint?

Tom Raftery: 12:34

Yeah, I think a lot of it is about setting and either meeting or exceeding expectations. Because if you say to me, okay, your package is going to arrive. Next Thursday. I go, Okay, next Thursday. That's fine. I'll deal with that. You know, unless I urgently, urgently, urgently needed, okay, it's coming next Thursday. That's it. And then if it arrives Thursday, great. But if you say to me, it will come sometime next week, we're not quite sure, then it becomes a little more frustrating. It's the lack of knowledge, and the lack of being able to plan. And if you say it's going to be okay, it's coming to me tomorrow, between 2pm and 3pm. I go, yes. Okay, now that I can deal with, because then I know, I can go out in the morning. And as long as I'm back at, you know, 2pm I only need to be in the house until 3pm. And then I can go, you know, being able to plan around it is great, but not having the information becomes really frustrating. And that's I guess the point I was asking when I when I talked about access to data for you, and I

Dennis Oates: 13:32

yeah, I think that's an excellent point. Because I think you hit the nail on the head. And and that expectation, you know, how does that play against speed? I think it's an interesting kind of discussion here.

Tom Raftery: 13:42

Exactly. I mean, I, I don't need it to be here at you know, within 12 hours, or within four hours, or whatever it is, just as long as I know, when it's going to arrive. So I can plan

Dennis Oates: 13:54

around. Yeah, absolutely. Yeah, there's there still will be a minimum, like, you know, if I tell you, it's gonna be here in two weeks, you might not be so happy. But if you know, but in some period of time, you know, as long as you meet some minimum speed, and that expectation, I really think that's the sweet spot for e commerce.

Tom Raftery: 14:12

And it must be getting increasingly hard for the small business owners who are your customers know who are having to compete with this? What kind of pressures are are hitting them? I mean, how are they handling some of the pressures, I mean, that the whole shift ecommerce has been brutally fast for them so that that must have caught them really short last year, when many of them probably hadn't planned to go on the e commerce route.

Dennis Oates: 14:37

Yet I think that's you know, this is really the the area where we're sindelle I think does a great job. And that is you know, if if I'm a small business owner and now I'm you know, I'm moving into e commerce, I may or may not know anything about shipping and you start getting into rates and zones and the and the complexities associated with shipping. It can be very daunting for these, these businesses. And that's where we come in and help like, like we're, we do a great job of being able to putting forth a, you know, simple, reliable, affordable kind of platform for folks to be able to ship. And then we're also behind the scenes understanding what are the best ways to be able to route things through different carrier networks, to be able to get, you know, the best value for these these shippers from a, you know, a cost and speed standpoint, as well as the benefit with your sustainability around not only the offsets, but by understanding which networks have available capacity. There's a an economic and a sustainability play there as well. And so what we do is being able to bring them together in a group B, we facilitate that ability to be able to extract that value from the market.

Tom Raftery: 15:49

Okay. And I can understand how it's important for, you know, these smaller businesses who are your customers, I can understand that what's important to them that the deliveries you're enabling for them are zero carbon, but it's also important for their customers. So are you enabling their customers to be aware of it in some way?

Dennis Oates: 16:10

Yeah, we do a little bit of, we do, you know, pretty significant branding on the website, where we talk about that. This also allows, you know, as a small business, shipper on their own website, or whatever sales channel they're using, to be able to promote the fact that their shipping is carbon neutral. And so that's definitely, that's where you start trying to get it into that consumer behavior that's changing that they want to have that eco friendly shipping option. And so I think this is an awesome way for a small business to be able to play in the same space with the Amazons and with the fedexes, who are announcing their climate pledges, you know, yeah, carbon neutrality by 2040.

Tom Raftery: 16:51

Yeah, exactly. Exactly. And where to next, Dennis? I mean, what, what, what's planned for cendol for the next three, four or five years now?

Dennis Oates: 17:01

I think it's, you know, in Australia, we've been around since 2016, mature network, and we're continuing to grow there as well. We've come to the United States in quarter four of 2019. And really where we are right now is we're growing, we're continuing to build out that diversity within our network. And I think you're going to see some pretty cool things with us in the United States, in terms of growth, and even just some of the marketing that we do, like we had two weeks ago, we had our dollar shipping campaign, which was, you know, hugely successful. From there, we'll continue to look at, you know, other areas around the globe, as well as some international opportunities for small businesses as well to be able to connect small business, you know, all across the globe. Okay, super, super.

Tom Raftery: 17:48

Yeah, I was gonna ask about Europe. When do we get access to Central? soon? I'm not sure when, but we're coming. Okay, cool. Cool. All right. We're coming to the end of the podcast. Now, Dennis, is there anything I've not asked that you wish I had? Or is there any topic that we've not addressed, that you think it's important for people to be aware of?

Unknown: 18:09

You know, I just got back to,

Dennis Oates: 18:11

I really think it's interesting, the idea of, you know, speed with e commerce and expectations. And I think, you know, you really teased it out. And I think that is, you know, that option of setting expectations. And I'm and I'm curious that if we don't see in the future, a products out there from a logistic standpoint that are you know, it would be considered slow versus current transit times, but are ecologically benefit, you know, beneficial than what we have right now. And so, I really think that there's this opportunity for this kind of idea of, let's become more efficient, and how we deliver, it's good for the environment. And it meets the expectation as a consumer. And so that's that kind of idea, I think will be interesting to see, you know, in the next, you know, 18 to 24 months of where that goes.

Tom Raftery: 19:02

Lovely, lovely. Dennis, if people want to know more about yourself, or about cendol, or any of the topics we discussed today, where would you have me direct them?

Dennis Oates: 19:12

So I think two things one is, keep informed. Keep understanding what all the different players in the market is doing Oh, are doing, you know, we as consumers should be demanding options when we buy things. So I think that's, that's very important. And then check out sundal. You know, we can go on to our website at Central calm, and I think we've got some pretty cool things going on out there as well.

Tom Raftery: 19:37

Okay, super. Dennis has been really cool. Thanks for coming on the podcast today. All right, thanks very much. Okay, we've come to the end of the show. Thanks, everyone for listening. If you'd like to know more about digital supply chains, head on over to sa p.com slash digital supply chain or, or simply drop me an email to Tom Raftery at sa p.com If you'd like to show, please don't forget to subscribe to it and your podcast application of choice to get new episodes as soon as they're published. Also, please don't forget to rate and review the podcast. It really does help new people to find the show. Thanks. Catch you all next time.