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Sent Items #99: Monday, Aug 10, 2020


Hi All!

Another week in the books. Some big news: The next issue of Sent Items will be published from some new digs, as I tweeted Friday evening: 


I realize it was rather witty, but I'm more surprised that a seemingly innocuous tweet garnered the reception it did (I had only a few more than 1,000 followers at the time). Maybe it's that dry wit... or the purple shutters. Nonetheless, one thing I’m most looking forward to is getting deliveries directly to my door. A nice change after living in high-rises for the past 16 years. 

A quick PSA:  I am working on a long-form article/blog post where I will be sharing my concerns with logistics bottlenecks on Q4 parcel volumes and capacity, and specifically honing in on the Postal Service. Obviously things have changed precipitously over the last 6 weeks since Louis DeJoy took the helm. My hope is to provide insights on what ecommece companies can do to help circumvent, or suppress the inevitable pain, and share insights on why I think this is happening right now. My plan is to publish in the next week. Please hit ‘reply’ if you have any thoughts or wish for me to review a certain aspect of this significant dilemma.

As always, please forward and share Sent Items here.

- Matt


Amazon and Mall Operator Look at Turning Sears, J.C. Penney Stores Into Fulfillment Centers - WSJ

  • Simon Property Group, the biggest mall owner in the U.S., has been in talks with Amazon. com Inc. to turn some of its anchor department-store spaces into Amazon fulfillment centers. Simon malls have 63 Penney and 11 Sears stores, according to its most recent public filing in May

  • For Amazon, more fulfillment centers near residential areas would speed up the crucial last mile of delivery. For Simon, turning over what was once prime mall space to fulfillment centers shows it would be willing to relinquish an essential way to bring in more mall traffic to secure a steady tenant.

  • That said, this is not so easy. These legacy retailers do not offer the most conducive store layouts and retrofitting them will be a battle. 

NC businessman has record of success, but is drawing fire as new postmaster general - The Charlotte Observer

  • Another good story on Louis DeJoy, highlighting his business success and loyalty to Trump and the GOP. Since taking over, DeJoy has made significant changes. New rules have canceled overtime, barred carriers from waiting for delayed shipments and making them leave mail at distribution centers if picking it up would delay them from their routes. The changes came amid a manpower shortage caused by COVID which has left 40,000 workers quarantined at various times.

  • 23 postal executives were reassigned or displaced in a Friday night memo outlining the “overhaul” undertaken by Postmaster General Louis DeJoy. “The shake-up came as congressional Democrats called for an investigation of DeJoy and the cost-cutting measures that have slowed mail delivery and ensnared ballots in recent primary elections. This concerns critics because it comes as Trump has escalated his attacks on mail-in voting.

  • Analysts say the structure centralizes power around DeJoy, a former logistics executive and major ally of President Trump, and de-emphasizes decades of institutional postal knowledge. All told, 33 staffers included in the old postal hierarchy either kept their jobs or were reassigned in the restructuring, with five more staffers joining the leadership from other roles.

Coronavirus Hobbled Amazon. How the Tech Giant Rebounded for Its Best Earnings Ever. - WSJ

  • Amazon just reported its greatest quarter ever, but getting there wasn’t easy. The coronavirus pandemic brought enormous challenges to the tech giant early on, tripping it up in a way rarely seen in its history. Delivery times and customer reviews slipped, essential items were unavailable in some areas, and worker absences created extended challenges. For the first time in years, the company’s share of ecommerce in the U.S. actually fell. 

  • But as the virus raged on, Amazon spent billions of dollars on its response, hiring workers, increasing pay, improving delivery times, conducting medical tests for employees and stabilizing its supply chain. Its share of online sales has already begun to rebound.

  • Many of Amazon’s temporary shortcomings during the pandemic came about because the company wasn’t prepared to handle the boost in demand it saw. While it still led competitors overall in package delivery times, its famed shipping speeds slipped.

  • Here are a few images which show the staggering rebound and scale of Amazon:



I found this chart mind-boggling. Hard to truly understand the breadth and extent of Amazon's Logistics. Put aside the 30,000 vehicles, 231 delivery stations and 188 fulfillment centers (oh and 57 sort centers too) ... they have 8 Airport hubs with 5 more planned!


UPS tacks on additional fees as it faces a flood of packages during pandemic - CNBC

  • United Parcel Service Inc. UPS 7.86% plans to impose hefty fees on large shippers during the holiday season, reflecting the added complexity and cost of an expected crush of online orders amid the coronavirus pandemic.

  • UPS on Friday said the fees could total as much as $3 a package for ground shipments and other lower-priced shipping options and up to $4 a package for air shipments bound for residences.

  • That is significantly higher than the last time UPS instituted additional fees during a peak holiday season, in 2018. Surcharges then reached 28 cents on ground shipments and up to 99 cents for some air shipments.

  • The starting fees are $1 for ground shipments and $2 for air. The company said it would also include surcharges of $5 on shipments that require additional handling and $50 for large items.

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© 2020 Second Marathon Consulting, LLC
Matthew Hertz is the founder of Second Marathon.

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