Logistics is becoming a key battleground for e-commerce companies, especially with Amazon setting a sky-high bar. Devin discusses the trends and where his company adds value.
Sramana Mitra: Let’s start by introducing our audience to FirstMile and yourself.
Devin Johnson: I’m the Founder and CEO of FirstMile. We’re based out of Salt Lake City, Utah.
Sramana Mitra: What is FirstMile’s business?
Devin Johnson: We are a logistics company. The relationship that we have with our customers is like that of a carrier. We provide shipping services for our clients much like any other traditional carriers. We have hundreds of clients around the United States in close to 40 states. We are their shipping carrier. Our model is slightly different. We do everything from same-day shipping in select markets all the way up through economy type shipping and international shipping.
Sramana Mitra: Shipping is an area that is going through a lot of innovation and a lot of heartburn for smaller e-commerce companies that are trying to compete with Amazon’s incredibly fabulous service from a shipping and delivery point of view. How do you look at the universe from your point of view and how do you analyze and parse it?
Devin Johnson: That’s a really good question. There’s a lot of turmoil and excitement. It’s a loaded question. As a provider to our customers, we have to be very conscious of Amazon because a lot of our clients sell on Amazon. We need to make sure that the experience their customers are having is sufficient so we can continue to be a provider for them.
It’s incredible what Amazon has done even in just socially changing the buying habits of an entire country in just a matter of years. They’ve really changed the status quo. It’s a challenge because the status quo is somewhat unsustainable from a financial perspective. This is what brought on a lot of creativity and ingenuity in trying to determine how it is that companies like mine can perform and support our customers’ needs in a way that our customers can stay in business.
A lot of consumers, my wife included, thinks shipping is free. It’s not free. Somebody is paying for it. It’s just a matter of competing from a price perspective. What kinds of products can support carrying the burden and cost of that shipment, and maneuvering the proper networks to make sure that you can hit those time-in-transit requests.
Sramana Mitra: How does a non-Amazon company compete with Amazon in this scenario? How does a company like yours help them compete?
Devin Johnson: Compete with Amazon from a logistics perspective?
Sramana Mitra: Yes, logistics.
Devin Johnson: Amazon has indicated they’re very much getting into the transportation space. They haven’t fully said as much. By their actions, they are rapidly becoming their own transportation company. I don’t know if it’s as much as competing with Amazon. There are not many companies that can compete with Amazon. Not many companies can lose tens of millions of dollars a quarter and have their stock price going up.
From a competition perspective, I don’t know that you can. We don’t really look at it as how we can compete with Amazon. We look at it in terms of working with Amazon. How do we work with them in terms of supporting our customers within the Amazon network? How do we look at working with them downstream? What kind of things, as a transportation company, can we do to supplement some of the things that they might need?