[00:00:00] Ryan Hanson: It's not about getting the product to the customer fast, it's getting the right product, perfect order every time, removing the friction because customers have options. And so we have to just remove the friction and make their life better so they just make it routine so they can order.

[00:00:15] Voiceover: Welcome to Supply Chain Now, the number one voice of supply chain.

[00:00:19] Voiceover: Join us as we share critical news, key insights, and real supply chain leadership from across the globe. One conversation at a time.

[00:00:27] Scott W. Luton: Hey. Hey, good morning, good afternoon, good evening, wherever you may be. Scott Luton here with you on Supply Chain Now. Folks, we've got a terrific show to up here today.

[00:00:37] Scott W. Luton: We're gonna be dialing it in. Well, how you can optimize your approach to making bigger gains when it comes to logistics, shipping, and really overall supply chain performance rather than taking an either or approach. There are huge benefits to the power of the, and especially when it comes to leveraging a hybrid logistics model that utilizes your talented in-house team and a three pl.

[00:01:02] Scott W. Luton: Stay tuned as we learn why and how from two industry leaders. So with all of that said, welcome everybody to a great show. I also wanna welcome in an outstanding panel here today, starting with Ryan Hanson, who serves as Chief Supply Chain Officer at Staples. He brings a wealth of supply chain and logistics leadership experience to the table.

[00:01:23] Scott W. Luton: Prior to his current position, Ryan held critical leadership roles at Ecolab. Amazon and Target and joining Ryan and back with us once again, 30 year industry veteran and the innovative CEO of RateLinx. Shannon Vaillancourt welcome them in. Hey. Hey Shannon. Welcome back. How you doing? I'm doing great. How you doing, Scott?

[00:01:45] Scott W. Luton: Wonderful, wonderful. And Ryan, so great to have you here on Supply Chain Now. Great to be here. Scott, good to see you. You bet. We have got so much to get into here, but I wanna start with some valuable context. Ryan, if you would, can you share for all of our global audience out there, a brief overview on the Staples supply chain footprint?

[00:02:04] Ryan Hanson: Sure. Happy to. And you gave 'em a b quick background, but I tell friends, I feel like I'm back at Amazon honestly as you, as you show our, our network. Wow. Um, we've got 38 warehouses or fulfillment centers across the country. You can order till 4:00 PM We deliver next day to 98% of the country without delivering from stores.

[00:02:22] Ryan Hanson: So by and large, we're a B2B distributor. We do have stores as well. That's a sister company, but we are a B2B distributor, 2200 plus of our own drivers that deliver to the desktop. We say desktop, but that could mean the third floor of a school to the classroom. It could mean. One of the thousands of hotel or hospitals we deliver to, to the nurses station, to the doctor's office, you know, anywhere within the hospital.

[00:02:49] Ryan Hanson: We don't just put product on the dock. We also use a lot of couriers, FedEx, UPS and other parcel carriers. But we really put the customer in the center and we've created a lot of rigor automation to ensure that that customer experience is top-notch. We've got an automation team that builds just about everything, so.

[00:03:09] Ryan Hanson: Almost 3000 robots that we have. We're developing new ones. We'll partner with new up and coming companies, like simple or right hand robotics, and then really get in, write the code or help write the code and make sure we tailor those solutions to us, which helps keep costs down and service up those red lines on the, on the chart really quick.

[00:03:30] Ryan Hanson: It's our Middle Mile network. Okay, so every night we've got about 375 trucks going from A to B to ensure the customer experience. Is as topnotch as we can make it. So if you order, you know, 10 things from the local fc, the 11th item is from the one just down the road. I say just down the road, but it could be 200 miles down the road.

[00:03:50] Ryan Hanson: We'll make sure we deliver all 10 to you to have that same experience. It's a little costly, but we wanna make sure that, you know, it's all about taking care of the customer. We, we think, you know, everyone in supply chain is in sales.

[00:04:03] Scott W. Luton: Outstanding. No wonder you feel like you're back at Amazon, man, the, in the innovation and the scope of what you're up to and the growth.

[00:04:09] Scott W. Luton: I appreciate that helpful context. I wanna start with, you know, this big fear that sometimes we hear out there, if I use a three PL, I lose control. So, Ryan, you've successfully implemented hybrid models at major companies. We've mentioned a few. What does strategic control really look like in this particular setup?

[00:04:28] Ryan Hanson: I would say early in my career, I probably thought the same thing. I wanted to kind of probably control everything within our own fulfillment, our own transportation. But what I realized through great companies like Target and Ecolab, uh, as well as Amazon is either it would take too long and you didn't.

[00:04:43] Ryan Hanson: You have to build that capability. It would cost too much capital, too much human capital, right? Build those capabilities and this speed, develop speed to take care of the customer is one reason to use a third party. The other reason is. There's some great partners out there, whether it's in running a, a warehouse for us or for me in the past, or many, many great transportation providers.

[00:05:06] Ryan Hanson: Or we wanted to focus on our core business and really zeroing on that from a supply chain. And then we'll use, you know, good third parties to augment those capabilities. But if you do that right, and we'll talk about that throughout this show, if you do that right, it feels like one team and it's a competitive,

[00:05:22] Scott W. Luton: so I don't wanna put words in your mouth.

[00:05:24] Scott W. Luton: So would I be right or wrong or somewhere in the middle if I say you're coaching the team but someone else is running the drills?

[00:05:31] Ryan Hanson: Yeah, I think you're, I think you're right with that. But again, it will feel like one team, like Shannon and I have done a lot of work over the years and when we're doing it right, it feels like one team and he helped with RateLinx, helped not only do freight and pay an audit to down to the penny, but he helped make sure we expose drillable data that then we could take operators.

[00:05:50] Ryan Hanson: And know what was going on at a granular level and save a lot of money and better customer experience. So it's partnerships like that that, uh, it feels like one team, even though maybe the parent company that's, that's operating is the coach.

[00:06:04] Scott W. Luton: Mm. Well, I'm gonna get example of that in just a second, but Shannon, really quick, that has got to be music to your ears.

[00:06:10] Scott W. Luton: When you hear that from Ryan.

[00:06:12] Shannon Vaillancourt: Oh, I, I mean it, he's not wrong. I remember some of those conversations that we had where I'm asking him questions. And it's almost like I'm looking at a crystal ball and he is like, how do you know that? And I'm like, here, this is what I'm looking at. I'm looking at this, this piece of data or this type of information.

[00:06:30] Shannon Vaillancourt: And it seems like you're always having this type of an issue. And then it's not only pointing that out, but giving some best practice advice around, you know, maybe this is something that you should think about doing. And you know, and then they do it and you measure it. And you know, again, the whole circle continues.

[00:06:48] Shannon Vaillancourt: And I think that was. I mean also to me that was kind of an aha moment. Realizing that, you know, the data really shows a lot more than just, you know, even though it's we're freight audit, it's more than just showing are you, are they being billed? Right. It, it was also kind of a, almost like a leading indicator to some of their carrier relationship issues that they were having.

[00:07:10] Scott W. Luton: Well, we we're good. That's excellent. Anecdotes and examples on the front end, but circling back to examples, Ryan, but further example of some of the things you touched on earlier. I. Where this hybrid model worked really well. Previously, it may be a time when having that division of labor where it improved service or saved money.

[00:07:30] Ryan Hanson: Yeah. I can think of, of so many spaces, but I'll, I'll go back maybe several years ago in high volume, less than truckload consolidation. You know, even in hindsight we would've had the capability to do that if that was a key priority for us. But there was a lot of partners in the business that were really good at it.

[00:07:48] Ryan Hanson: And so we've leveraged a few good three pls in that space. Great partnerships. We aligned on what to measure, had transparent relationships. There was some operational issues, but nothing because it was a third party, it was would've happened potentially if it was us as well. And we were able to save a lot of money in the front end, drive faster inbound to our, our warehouses, and then be in stock, uh, faster.

[00:08:15] Ryan Hanson: So that's one of many examples. Yeah,

[00:08:17] Scott W. Luton: money, speed and protecting that precious inventory. Having, being able to have the right inventory at the right time. Love that. Ryan, a whole bunch more. Shannon, let's bring technology, you know, the technology guru here. Tell us more about technology, and especially where our TMS can help make that handoff between in-house strategy and three PL execution really work in practice, not just in theory.

[00:08:40] Shannon Vaillancourt: Well, I think the, the TMSs today really have evolved into knowing they have to do this and. That's where I think that that seamless integration that it has 'cause it, it already has all that order information and then passing it to the three PL and capturing that same exact information, uh, that's coming back as if it was, uh, a direct carrier back into one data point, I think is, is really what's happening today with the GMs and that's the crucial part, I think, to make some of this stuff.

[00:09:11] Shannon Vaillancourt: Very possible with the three pl and get rid of that, that fear that's out there.

[00:09:15] Scott W. Luton: Mm. And, and you know, one of the things that helps with fear and helps build trust is visibility and transparency. And, you know, in, in previous conversations I've had with Shannon, we've talked about a shared dashboards, is, is that, is the sheer dashboard view becoming more of a standard expectation among shippers now?

[00:09:36] Shannon Vaillancourt: Oh, absolutely. I think it's more than just an expectation. I think it's a requirement, actually, is what I'm starting to run into more and more. You know, it's funny, as I talk with customers, some of them are, are, they always talk about visibility. I need visibility, so I need a TMS to get that visibility.

[00:09:56] Shannon Vaillancourt: And I think A TMS gives you visibility, but what I think it really gives you is control and it also gives you. I think a more streamlined approach to doing things. 'cause there's a lot of interaction that has to happen with a three PL in order to, you know, get product delivered, communicate your instructions, and then get the feedback on did it occur.

[00:10:21] Shannon Vaillancourt: And it's like that's where I think the TMS does provide visibility around that stuff very well. And it helps control that conversation and do it in a very consistent manner, which is what I think is key. To everybody being successful with this

[00:10:37] Scott W. Luton: control consistency, maybe all that helps create more calm in the chaos that goes along with managing supply chains each day.

[00:10:45] Scott W. Luton: Good stuff. Ryan, I'll circle back to you, and again, one of the themes here is kind of the best of both worlds, right? Let's keep going down this path. What else? When it comes to mind, the benefits of mixing, you know that in-house expertise, the experts in the business, right, with outsourced flexibility and also outsource expertise for that matter.

[00:11:04] Ryan Hanson: Yeah, there, there's so many, so many good examples. But again, I'll use an example from Staples of how we're doing it for others, because we have this capability, and again, I, I've, I've only been here about a year, so the team before me built this, this, this. We're just trying to take it to the next level.

[00:11:18] Ryan Hanson: But our, our sales team has found with a lot of our business customers that they rely on our supply chain, that speed and accuracy so much that we are now delivering their SKUs for them. Yeah. You know, I can't name all the companies, but, uh, two quick examples is we'll deliver to almost, I don't know, 8,000, 9,000 coffee companies across America every day.

[00:11:43] Ryan Hanson: Okay. And the beauty of doing that for some of their items is that it's rapid replenishment. So if sales are up and now they're out of an item and like a non-retail item, we can bring that in fast the next day. We don't have to wait for a week. And so you'll see that. We can meter that product in, put it in the back room.

[00:12:03] Ryan Hanson: The sales team can just sell and they don't have to worry about a big pallet or two pallets on the sales floor of a small footprint. You know? So that's one. And then about eight weeks ago, nine weeks ago, we started delivering two SKUs, uh, maybe, maybe three SKUs. So a small amount of SKUs for another store, 600 stores.

[00:12:22] Ryan Hanson: And we're already having conversations about can we deliver a lot more for them? 'cause they see that experience. That they didn't have, uh, internally or with another provider. So that capability that's already built, we have density. We're in every neighborhood every day. So we can offer that kind of a service really cheap, and it just streamlines, you know, takes labor outta the back room for our store partners and lets them sell.

[00:12:45] Ryan Hanson: So there's two quick examples.

[00:12:46] Scott W. Luton: I love it. Uh, so what he is telling us, uh, Shannon and all of you out there, is that, uh, Ryan and the Staples team. By fueling us all with caffeine, they help global supply chain keep moving. So I appreciate that, Ryan. Caffeine. But getting aside, as you were sharing those two examples, how do you determine which functions or lanes stay internal versus going external to the three?

[00:13:08] Scott W. Luton: Uh, three pl I.

[00:13:10] Ryan Hanson: For that example, it's not necessarily for those other companies. It's not necessarily, are we only gonna stay in our lane and sell to them? Right. It's whatever we can do to make their life better, honestly. And it's usually, it's gotta be a win-win. It's not gonna work out for us to deliver for them if we can't save them.

[00:13:24] Ryan Hanson: Money. Speed. Or help them drive sales, it's gotta be a win. So we, we recognize that completely when we're looking for what to own and run ourselves versus others. Like for example, we use over 20 couriers across the country and they do, by and large, a great job for us. And so we'll look at density, we'll look at making sure is it better for them in that market to deliver than us to expand to that market.

[00:13:50] Ryan Hanson: So we're constantly looking at that. But over many, many years, several decades, we've built those relationships with our strategic providers, and so it works really well. I mean, there's some churn a little bit on the fringes, but generally it works really well. But we're constantly looking at where would we expand the fleets.

[00:14:08] Ryan Hanson: Yeah. We love our fleet, our, our transportation team is fantastic. We can't be everywhere with that team. So we look at work partners. Does it make sense to, to have a career, for example.

[00:14:18] Scott W. Luton: Love that customer being a north star. Your, to your first point and one of the last points you mentioned, Hey, we got a low level on our truck drivers.

[00:14:24] Scott W. Luton: We got professional truck driver week coming up in September, so stay tuned for that. Shannon, uh, unification, right, unification alignment so we can move faster and, and, and, uh, perform better. How does technology wanna double dip of technology with you? How does it help unify those in-house teams and those three pls so they're truly working?

[00:14:46] Scott W. Luton: As one versus right hand, left hand.

[00:14:49] Shannon Vaillancourt: I think it's, it's really two things. It'll, it's gonna streamline the process and it's gonna improve the communication. So by streamlining the process, what's happening is it's freeing up the in-house team to do maybe more strategic initiatives because they're, they're outsourcing a part that maybe they're, you know, they either don't have the expertise to do, don't have the bandwidth to do so.

[00:15:12] Shannon Vaillancourt: It may not even be, even be an expertise thing, it's just a bandwidth issue. So free that up, send that out to somebody who does do it really well. And then with the, the technology, that's where the communication comes into play. You know, by having good, constant communication, good data flow, that's what's gonna improve the customer service.

[00:15:33] Shannon Vaillancourt: And that's what you're gonna notice without that communication, that's where I think there's no trust. And that's where people. We'll all of a sudden go to what they think is happening. And what's always fascinating is that not many of us are optimists like we think we are. Uh, so that's where most people will go to the negative side.

[00:15:53] Shannon Vaillancourt: Well, you know, we all say no news is good news, but that's, some people are like, oh, I'm just waiting for, to hear the bad news is what they kind of go to on the business side. So that's where I think that communication. Really is important to build that trust.

[00:16:08] Scott W. Luton: Mm. Shannon, I love that. That's such a great keep it real moment.

[00:16:12] Scott W. Luton: Uh, all of us oftentimes say we're, we're optimists, but there's there, maybe there's not as many practical optimists out there, but you also touched on more serial and more serious note, trust and trust across the ecosystem. And, and Ryan. Going back trust, ensuring continuity, especially as we, as we dynamically assign responsibilities.

[00:16:32] Scott W. Luton: Can you speak to that and you know, what about that? You talked about some turnover at the fringe. How has that overcome and addressed?

[00:16:40] Ryan Hanson: Well, maybe build off, you know what Shannon said on, on trust. We all have long memories. You could have a third party company or a relationship externally like that, that lets you down.

[00:16:51] Ryan Hanson: Maybe it's just me, but 10 years ago I'll remember that. They'll remember it as well. If we don't treat our strategic partners truly like strategic partners, I think it definitely goes both ways. But when you have that trust, uh, it's gotta be at all levels for those I. Key partnerships. You know, you gotta be talking daily on the tactics.

[00:17:10] Ryan Hanson: Weekly, for sure. Monthly, quarterly, uh, at a higher level that allows both companies to kind of somewhat open their books and show, here's our plan to grow. How can you help me? Here's your plan to grow, how can we help you? And that's where it gets funk to be able to, to divide those responsibilities out.

[00:17:27] Ryan Hanson: Because a lot of times you'll think you know what the capabilities of a, of a partner are, but you'll only know. A half of them, you know, and so they'll want to need to educate you on new capabilities they've developed or something that you haven't looked at before that might help you out.

[00:17:39] Scott W. Luton: Hmm. Ryan, I love that.

[00:17:41] Scott W. Luton: And one of the things I hear there. Is you bake that into your daily routines to show trust and your communication and the management style and, and, and, you know, day-to-day operations. Good stuff there, Ryan. Okay. Let's get into cost optimization and creating more value. Right. So, Ryan, hitting this third pillar, cost optimization, value creation, where do you see the savings that you've, you've touched on a couple times in this hybrid model.

[00:18:09] Ryan Hanson: They're all over the place if you're, if you're really looking. Another example maybe that I haven't used is we're starting to do some quite a bit of fulfillment on different marketplaces for our product. We're also looking to be able to do that for other companies. Well, we built this capability to be able to deliver, whether it's Amazon, marketplace, Walmart, target, doesn't, doesn't matter.

[00:18:26] Ryan Hanson: We can hit all of the service levels and so one savings then for another company to leverage players like us or someone, someone like us. Is that you can save an inventory. You don't have to have a separate inventory for each one of those marketplaces. You can have FBM or Fulfilled by Marketplace, and then that third party or us, we could be your engine behind the scenes.

[00:18:47] Ryan Hanson: That's one example. The other thing that comes to mind is one I've already mentioned on if you work with a partner that already has density. Or even that speed capability across the country, our fulfillment centers. Um, yes, we have a lot of them, but more importantly, we've got great leadership, great rigor, great routines, and we measure them.

[00:19:05] Ryan Hanson: So if you have a third party that does that, they'll know if they miss a carton every day, and then they can expose that to you and say, here's why we missed one or two cartons, and here's what we're gonna do different tomorrow. Not to miss them, I would just say make sure that they're looking also at.

[00:19:20] Ryan Hanson: The safety of their team, the engagement of their team, so you get long-term results and low attrition and high quality, not maybe the perception of speed or cost savings, and then it could fall apart if you don't have a really good engaged team

[00:19:33] Scott W. Luton: across the board. I'm so glad to hear. You mentioned safety, right?

[00:19:36] Scott W. Luton: Taking care of our team members, how that's an important thing to measure regularly. Ryan, I love hearing that. And when you think of other metrics and KPIs, Ryan, as you're tracking. How value is being created? What else would you add?

[00:19:52] Ryan Hanson: There's so many. I would say over short damage, kinda your traditional OSND, it's not about getting the product to the customer fast, it's getting the right product, perfect order every time, removing the friction because customers have options and so we have to just remove the friction and make their life better.

[00:20:07] Ryan Hanson: So just make it routine so they can order. That's come to mind first.

[00:20:10] Scott W. Luton: Okay. Alright. Removing friction, Shannon Vaillancourt. Removing friction. I love that. Uh, we gotta find new ways of doing that. Only hour, it seems like in this ever fast moving, uh, world we live in. But what else, uh, Shannon cost insights can shippers uncover when they have that clear, uh, not only clear vision into the ecosystem, but also have a great clear division of labor and shared analytics with their three pls.

[00:20:38] Scott W. Luton: Your thoughts there?

[00:20:39] Shannon Vaillancourt: Well, I think that's where you're able to break out the different cost factors. So you've got, you know, the, the pure freight cost, you know, you have detention, are you having any dwell time issues, things like that. That's one, you know, very important metric as compared to labor. And that's where I think it can get mixed together if you're not measuring it correctly.

[00:21:03] Shannon Vaillancourt: And I think that that's something to really be aware of. So there is that hard dollar freight cost. Metric that you're able to finally zero in on and keep that labor cost away from it.

[00:21:16] Scott W. Luton: Good stuff. I'm gonna shift gears. Ryan, you are going through quite a growth chapter it seems. So, for companies that aren't optimizing shipping costs through this hybrid approach we're talking through here today, how does, how do you see it impacting their growth strategy?

[00:21:31] Ryan Hanson: Uh, in a few ways. If you're not spread out, we'll just talk across America first, but it could be all over the globe. But within America. If you can't deliver fast to the customer, you'll lose business. And so let's say you only have three of your owned warehouses and they still could be strategically placed, you know, east, west, middle.

[00:21:49] Ryan Hanson: But if you can't get to the customer next day, we also do some same day. We're out of our stores and we'll do it on our fulfillment center soon. If you can't do it fast, you're gonna lose sales. You might not even realize how many you're losing. And so we're working with a few other partners that they only have one or two buildings on the East coast and we can be their provider, you know, somewhere else or that's what we've used in the past, um, at other great companies that work with the Ecolab and Target is there could be a location and you look at maybe Alaska, Hawaii for sure, maybe some smaller volume areas that you have with your customer base.

[00:22:24] Ryan Hanson: Is that an area to lean in instead of starting your own? Your own warehouse and your own fixed cost. So that's, I I think that's what comes to mind there.

[00:22:32] Scott W. Luton: Okay. Well, shifting from growth, 'cause let's, I don't wanna talk about losing sales, that's everyone's least favorite topic to talk about, right? Number two is compliance.

[00:22:43] Scott W. Luton: How could limited cost optimization impact at businesses SEC reporting, the credit rating, maybe the compliance for SOC and ESG, your thoughts there?

[00:22:54] Ryan Hanson: Yeah. Uh, again, I'm blessed with almost 7,000 people that are. You know, true experts in logistics and so I don't have to worry too much about that. Now, that said, I have in the past and I still, I still worry about it.

[00:23:06] Ryan Hanson: So whether it's hazmat compliance, food compliance, dated goods, ensuring if we're building a new site that we're fully up to code and we don't slow down a build because of something that we overlooked. I think it's incredibly important to work with experts that. Understand all, all of that. Mm. One delay in opening up a new site.

[00:23:26] Ryan Hanson: If you're working with the three PL can just set you back months and then you have no place to put your product. I've been in that position before too, where timeline to switch from one of our sites to one of theirs, for example, if they're slow on a build, it's a really bad place to be in, you know? So you gotta need experts that understand the permitting process and be in compliance also.

[00:23:46] Ryan Hanson: Not only 'cause it's the right thing to do, but customers expect it to be focused on the environment. It's, it's always a win-win, you know, so if we can reduce the carbon footprint, or your third party can reduce the carbon footprint, it's usually better for costs anyways. But even if it's not, it's the right thing to do.

[00:24:02] Ryan Hanson: And so a lot of companies are focused on, it's almost everybody is. One thing we're doing is we're working with, you know, pack size. We have over a hundred or about a hundred pack size machines, so we'll build the carton. It's just about the exact size that's needed for the length of height of whatever the customer orders, so you don't have too much knowledge.

[00:24:21] Ryan Hanson: You save there in money and it's better for the environment. We all get too many parcels delivered to our houses. We don't wanna make it any bigger than than necessary.

[00:24:29] Scott W. Luton: I love it. Love those machines. Use exactly what you need. No more, no less. Shannon, uh, one of the themes that he touched on there was finding those sound and trusted accelerants, right?

[00:24:40] Scott W. Luton: Whether we're talking, you know, inside the four walls or outside three pls, kind of as part of this conversation, but what other examples come to your mind, how some of the RateLinx clients have overcome some of these growth and financial performance obstacles that Ryan addressed?

[00:24:55] Shannon Vaillancourt: I think it just comes down to finding the right partner that's gonna fill that gap and, and they'll do it quicker.

[00:25:01] Shannon Vaillancourt: I mean, I always go off topic a little bit into other areas and I think about, you know, being here in Scottsdale, I always think about golf and you know, with the US Open, just being done with, back when Tiger won the 2000 US Open, did you know that the golf ball he used, the Nike golf ball was the precursor to the Pro V one?

[00:25:22] Shannon Vaillancourt: No.

[00:25:22] Voiceover: Yeah. Really?

[00:25:23] Shannon Vaillancourt: They actually figured out Nike did how to create that ball so it would hold its shape better and and move itself through the wind better and all that. The problem that Nike had was they didn't have the manufacturing facilities to produce that ball and mass, so Titleist beat 'em to market on that ball, and that's why it's now the title is Pro V one is the Ball.

[00:25:47] Shannon Vaillancourt: Nike actually created it first. They just didn't have the. The capacity to create it. So that's where I look at like this hybrid model and think about that. I was watching the mega brands that, that built American, they were talking about retail, you know, in 19 62, 3 big retailers were created at the same time.

[00:26:06] Shannon Vaillancourt: Dayton's. And my son's like, who's that? And I'm like, God, you're so funny. You're, you're so young. And you know what Kmart did? Is they went into existing buildings, so they grew quick, very quick. Whereas Walmart didn't do that. They built their own. Right. And you know Kmart, as we know eventually, I mean, they dominate.

[00:26:29] Shannon Vaillancourt: I remember that was the thing. You go for the, what was it, the blue light special, right? At Kmart. But that's where, again, instead of trying to do it all themselves, they went and found buildings. So it's like, that's how I look at this type of three PL model. It's like. You know, you've got, you either don't have density in an area, you just don't have enough volume, you don't have enough something.

[00:26:52] Shannon Vaillancourt: And that's where that three PL model really comes and, and fits that gap and gets you there quick with expertise that would take you years to create. And I think that's what I've seen out there and that's where I see it work really well.

[00:27:07] Scott W. Luton: Accelerants, accelerants. And going back to your first example, maybe when it starts impacting the balls that sit in the lake for three years, 'cause that's what.

[00:27:13] Scott W. Luton: Fuels my golf game. We'll have to talk more about that innovation. Shannon,

[00:27:18] Shannon Vaillancourt: I've heard, I've heard the top sites last well in water, so I think you're good.

[00:27:22] Scott W. Luton: You're seeing into my soul, Shannon Vaillancourt. Okay, well I'm gonna pick back up on something Shannon said there, Ryan. And we're talking innovation, right?

[00:27:30] Scott W. Luton: I. You are doing some really cool things, new things for the business in some ways, new things for the industry, uh, and you've led transformation efforts at some, you know, massive organizations that we've talked about. Let's talk culture though. How do you foster that culture of innovation, uh, when part of your logistics operation is external?

[00:27:48] Scott W. Luton: Uh, well, I've had a chance to work with

[00:27:49] Ryan Hanson: some just fantastic people over the years, and so they've taught me a ton. So it's, credit goes to them. I've just been part of the, part of those teams, but where I've seen the best innovation is when you have. Everyone, or almost everyone in your organization within supply chain is thinking about how to do something quicker or better, faster, safer.

[00:28:08] Ryan Hanson: And then you wrap that with a great continuous improvement program so that those ideas can not only filter up, you can look at the best ideas, but that associates get feedback on what's gonna work, what's gonna go forward. Maybe there's some financial recognition in there to really incent some of those, some of those ideas.

[00:28:25] Ryan Hanson: But there should be. This great continuous improvement project, not just once a year for budgeting and you get great projects for the next year. It should be hundreds of projects. Some are single, some are double, some are home runs, but there should be a lot and that drives engagement. So, you know, Ecolab did that great and so I learned a lot from them at that.

[00:28:45] Ryan Hanson: So I'm trying to, you know, bring that here. There's great innovation and cul that culture here. We just have to do a better job. Me wrapping that and getting ideas from, from everyone. As a third party that I would look at, that's a question I would ask a lot of them. You know, so if you go in to look to assess companies, should I do business with them or not?

[00:29:02] Ryan Hanson: And you're going through the RFP process, that is always, this is always an area that you look at. What is our continuous improvement program? What's their innovation? You know, what's the reward for each other when you work together to come up with a way to save money. So it's not just for one side or the other, but both teams need to have the pain share, gain, share to really be all in on it.

[00:29:22] Ryan Hanson: Otherwise. That will die out. I think they might say in the RFP or in that discussion. But when you get really into it day to day, it's, it, it may not exist.

[00:29:31] Scott W. Luton: Mm-hmm. Well, I wanna pick up on another thing that Shannon mentioned and ask you about Ryan, you know, accelerating, accelerating initiatives and projects and directions.

[00:29:39] Scott W. Luton: Where, where do you see, in your experience, where that hybrid model can help make things happen faster?

[00:29:45] Ryan Hanson: My mind goes to ai. We are on the journey for ai. We don't wanna be left behind. We're trying to learn as much as we can. We've got a lot of use cases internally, but my head of analytics, uh, and I will talk to a lot of players in the market to learn what's out there, maybe do business with them even though we do a lot in-house.

[00:30:03] Ryan Hanson: So we've got machine learning and AI with our demand planning, supply planning, carton consolidation, decision point. I won't get into it. There's some really cool technology here. Hmm. But we know that we need to work with partners that are doing something even different in that space. So I carve out time in our calendars to make sure we're listening.

[00:30:23] Ryan Hanson: You know, we all get hit up a lot with new companies that are out there. We don't have time for all of 'em, but you try to look at the ones that I. May have a, a shot to learn something good. I met with one last night, so it's, it's, it makes you think differently. Wouldn't have found RateLinx without kind of that, that curiosity just to listen, learn.

[00:30:41] Ryan Hanson: I think I went in that first discussion, Shannon, with your team in San Diego. You guys were giving a presentation and I was, maybe shame on me, maybe it's not fully paying attention in the beginning, but the more I just wanted to be out there and listening and learning and then you caught my attention and another gentleman on my team and.

[00:30:56] Ryan Hanson: And we wanted to learn more. And so that's the way I think that we keep doing it. We, we know, we don't know everything. We know there's partners out there that are doing it better and there could be a match and do a win-win, you know, partnership.

[00:31:08] Scott W. Luton: So on that note, Shannon, two part question for you. Real time data and, and having it available to make these hybrid models really successful, that drives innovation and using that technology in general.

[00:31:21] Scott W. Luton: To keep those internal teams, those three PL partners aligned around those innovation goals and progress over time. Your

[00:31:28] Shannon Vaillancourt: thoughts there, Shannon? Well, I mean, data's the foundation for innovation. The visibility allows you to see the areas that need improvement, and if you have real time data that allows you to make those decisions faster, so you just think about what continuous improvement is all about.

[00:31:48] Shannon Vaillancourt: I mean, it's, you know. It's like say it real, slow, continuous, and improving. So how do you continuously improve if you don't know where you're at and what would you be improving if you don't know where? Maybe it's not performing the way you want because it's not about decision making. People make decisions once they get all the information they need.

[00:32:13] Shannon Vaillancourt: What differentiates the leaders from the followers? Is, how quickly can they make those decisions? That's how you get out in front. It's not that you made a better decision. It's made you made it faster. That's what I've learned. That's why I think it's the foundation. Without it, you have no chance.

[00:32:30] Scott W. Luton: Hmm. Say it slower for those slower folks like me.

[00:32:34] Scott W. Luton: I like that. Uh, all right. Relationships. We talked about caffeine fueling, uh, global supply chain, but you know, kidding aside, relationships, fuel business, global business, and certainly supply chain. Ryan, when it comes to relationship management, how does a hybrid model support stronger partnerships with carriers?

[00:32:51] Scott W. Luton: If you do it right, it's

[00:32:51] Ryan Hanson: just gets like, maybe how does it not? I go back, honestly, I'll use transportation example. We use some of the same carriers today that I used early on in my career at at Target. The relationships that we built there. That I built there, but our team and I built there through good routines and maybe some tough conversations to make sure you get to the, the root cause of issues.

[00:33:14] Ryan Hanson: I use those today and those relationships today, and not only in the transportation space, but we've got partners that I used to work with in that space. That now are buying our products, you know, and whether it's JanSan, whether it's break room, whether it's traditional office supplies, which we do a lot more than just that, but now they're a customer.

[00:33:34] Ryan Hanson: I wouldn't have thought of that years ago, you know? But it's really cool. You know, the supply chain is a pretty small organization or the community in the big scheme of things because of what you do here, Scott and others. Uh, if you lean in and leverage those relationships, uh, you don't do it for like, maybe to.

[00:33:51] Ryan Hanson: To have another sale down the road. You do it to learn and build and solve problems for your current customers. But I tell you, over time, I've leaned on those relat, those external relationships over and over, and it's paid off.

[00:34:02] Scott W. Luton: Mm. And, and, and for the sake of time, I'm gonna, I've got about 17 more questions.

[00:34:07] Scott W. Luton: I'd love to ask you both, but Ryan Shipper choice. How do three pls help businesses become shippers of choice with carriers? And of course, how does that help supply chain businesses? Your quick thoughts there.

[00:34:19] Ryan Hanson: Yeah, our, our, you know, our transportation providers, I don't, I don't wanna say this wrong, don't care if it's like one of our fulfillment centers or our third party.

[00:34:26] Ryan Hanson: It's our responsibility to make sure we take care of their drivers. We get them in and out fast. We are safe to work with, we're good to work with, and that we look at the long term. I know in the short term, we like the market goes up and down. Like I said, I have a long memory just like everybody does. So if, if someone is, takes too much of advantage of that up and down in the market.

[00:34:47] Ryan Hanson: I won't say the name, but I can think of a couple right now from 10 years ago. I probably won't do business with them today, and so I'll remember that. You know when the market is in our favor, I'll remember that to make sure it's, yeah, we'll get some savings, but we're not looking to gouge people, right?

[00:35:03] Ryan Hanson: Because it's gonna turn the other way, and that's just the partnership. We want to be a shipper of

[00:35:07] Scott W. Luton: choice. Mm. Shannon, we've already talked about the value of real-time data, but when it comes to better carrier relationships, your quick thoughts there?

[00:35:16] Shannon Vaillancourt: Well, I think sometimes it's just using the, the three pl to do the things that maybe the carrier's just not good at.

[00:35:23] Shannon Vaillancourt: You know, I think what a lot of shippers lose track of is what their carriers are really good at, and it's like, why, why are they always making this mistake or always doing this thing wrong? It's probably 'cause they're just not good at it. I mean, you know, there's, there's some carriers that we always used to.

[00:35:43] Shannon Vaillancourt: Make the butt of the joke in terms of, you know, they're low cost, but they're bad on service and it's because the service that that customer is trying to get from them is not their core service. That's just not what they're good at. So it's not that they're a bad carrier, they're just bad for that. And I think that's where then going to that hybrid model, finding that three PL partner who really does that well.

[00:36:06] Shannon Vaillancourt: I mean, do you think an LTL care is gonna deliver nicely to the third floor of a hospital? Maybe not, but they might, but maybe, but probably not.

[00:36:17] Scott W. Luton: I like your practical pessimism, Shannon. We, it, it is. That's, and I'm only ca halfway kidding. I need to be more, I'm an

[00:36:23] Shannon Vaillancourt: optimist. No,

[00:36:25] Scott W. Luton: I'm must I agree that. Well, you know, but when it comes to planning and, and seeing things through, I think it's healthy to have a little practical pessimism.

[00:36:34] Scott W. Luton: Right. It doesn't mean make you a negative person, but you know. Things don't always work like we have it planned and, and, uh, that's, that's the nature of the business we're all in. Okay. We've got some great advice. So Fast and Furious is finish. Ryan, I know you've got probably 27 pieces of critical advice, but if you had to, uh, focus it in on maybe your top three pieces of advice, what would that be?

[00:36:57] Ryan Hanson: Like Shannon said, get to know the capabilities of a lot of players, you know, before you're gonna make that decision. It's a big decision. Sometimes it's hard to reverse, like if you're. Setting up blog contracts and they can have a big impact if you make the wrong call, even on cost, let's say the service is still good, but you, you make the wrong cost call.

[00:37:14] Ryan Hanson: I'd say slow down in the beginning. Really know what you want to go after on that capability to really drive sales or to drive savings, or to drive safety analytics, and then really get to know the market spend time upfront. I've seen, and I've done this, I've gone short on. What are the requirements that we want to have and like we're looking at a potential planning system down the road.

[00:37:40] Ryan Hanson: Hundreds of requirements, and we'll narrow that down to the more important ones, but hundreds of of requirements. Now, if it's a carrier delivering to the third floor of a, of a hospital, to Shannon's example, there's probably not 300 requirements, but you have to look at the capability of that carrier community.

[00:38:00] Ryan Hanson: Do a good bid if you haven't worked with 'em before. Talk to other people that have used them. We do that a lot. You know, before we did a lot of business with Shannon, we talked to people that we're using and found out, you know, unfiltered. What do they think? We do that a lot to make sure that you're making the right choice.

[00:38:16] Ryan Hanson: And then usually that choice then goes, you know, much better in the long run.

[00:38:20] Scott W. Luton: Ryan, love that. One of the main things I'm hearing you sharing is don't mail in that selection process. Double down and then that will help you find partners you can really trust in and grow with for years. Alright, so, uh, Shannon, your final parting thoughts before I share a couple of, uh, resources for folks out there?

[00:38:39] Shannon Vaillancourt: I, I think, you know, we've talked about continuous improvement and, you know, data, three pls and I feel like, you know, sometimes people lose track of. The continuous improvement model and theme. And that's where I feel like, you know, getting with that the right three pl, you can have them, you know, just like Ryan had some examples where they started small, proved it out, and then expanded.

[00:39:05] Shannon Vaillancourt: And again, that that makes a good on both sides. So I think that's, open communication is so key to make sure that all this is so successful.

[00:39:16] Scott W. Luton: I love that how the relationship between y'all two and what you've done over time. I mean, it really, it really challenges other folks to find those right relationships that you can trust, innovate, and grow with, as you know, solving old and new challenges.

[00:39:29] Scott W. Luton: So big thanks, uh, Ryan Hanson with Staples and Shannon Vaillancourt with RateLinx for being here today. Folks, I got some resources for y'all. Uh, a couple of them. I'm gonna start with a great event that I was at last year that y'all will enjoy, and that's the Insight Conference hosted by our friends at RateLinx.

[00:39:46] Scott W. Luton: It's back again for 2025, October 14th through the 15th in beautiful Scottsdale, Arizona. We were talking about how that's a perfect time of year in Scottsdale. We're dropping a link right there. There's some great speakers, great sessions, y'all. Check that out. You can meet Shannon and the whole gang.

[00:40:01] Scott W. Luton: Secondly. I'll tell you, Ryan is fearless. Uh, if you've got questions or if you want to explore adding a three PL to your logistics strategy, you can connect with him. And I'll tell you, I've had two conversations. Ryan, I've walked away with about 37 pages of good notes. And, uh, Ryan, I really appreciate you being here.

[00:40:18] Scott W. Luton: But also Shannon Vaillancourt, Hey, they're doing some really cool things at RateLinx. I encourage you, uh, I've, uh, had the pleasure of, of watching Shannon grow and innovate for years now at RateLinx we're dropping his LinkedIn. Profile right there along with uh, RateLinx.com. So check out the organization.

[00:40:35] Scott W. Luton: Alright, so big thanks to Ryan Hanson. Thanks for being here, Ryan.

[00:40:39] Voiceover: Yep.

[00:40:39] Scott W. Luton: Good to be here. Thanks, Scott, for the invite. You bet. Shannon Vaillancourt, as always, wonderful to see you. Thank you. Appreciate it. Thanks for being here. Uh, we got the smartest audience in all of global supply chain, but you got homework.

[00:40:51] Scott W. Luton: Take one thing from today's conversation. Ryan and Shannon dropped a lot. Take one thing, put it into practice. E's not words. That's how we get things done. And with that said, on behalf of the end whole team here and Supply Chain Now, Scott Luton challenging you, do good, give forward, be the change that's needed, and we'll see you next time right back here on Supply Chain Now. Thanks. Bye.

[00:41:10] Voiceover: Join the Supply Chain Now community for more supply chain perspectives, news and innovation, check out supplychainnow.com. Subscribe to Supply Chain Now on YouTube and follow and listen to Supply Chain Now wherever you get your podcasts.