Hey there, gosh it’s been a while since I’ve written an update, so much going on…ok, this is going to be a big brain dump, here goes!
COVID has been interesting, the team have been doing a super job, with the last lockdown the SLT were all on-line at 9pm on Tuesday the night of the announcement discussing the strategy, by 10am the following morning the split shifts were in place, letters to customers and staff had been distributed, cleaning schedules and health checkpoints for all staff were implemented. Boom – job done.
I want to make a quick shout out to my SLT. Jax you are truly one in a million and best leader we have ever had. Hilma I don’t know what I’d do without you. Phil you are the best wingman anyone ever had. Dan you are our secret sauce and brilliant, Kim you are the most trustworthy, hardworking, passionate, and caring person (customers, staff and the business) I have ever met. Thank you all for your extraordinary dedication to our clients, the business and our staff.
Order volumes over the first lockdown were volatile, in the first few weeks we tanked over 70% on outwards but closer to 50% on inwards during level 4 as we still had a lot of purchase orders on the water, inbound…we actually had to quickly find and set up an extra facility (2000 pallets) in Wiri to cope with so much stock coming in and not going out. We were pleasantly surprised to find about 30% of our volumes were essential services.
In level 3 our ecom clients exploded, SCS is now the largest b2c 3PL in NZ which sounds great however we were running 24/7 and the COVID restrictions around social distancing and splitting into multiple shifts and dramatically increased cleaning schedules we slowed down a lot and lost the efficiency we need to earn a profit. There was a lot of stress in the business navigating between hundreds of staff and customers needing updates on orders and courier shipments some of our SLT were working into the wee hours of the morning managing comms, schedules, shifts and inquiries – I was in Utah but heard stories about the gargantuan effort the team was making including Hilma sleeping in her car one night working late with Jax ensuring our HR processes were tight. We walked a tightrope between trying desperately not to fall afoul of the law and send out the wrong items as we managed pressure from equally concerned clients about who would send what, on balance the team did a stunning job, our clients were amazing and I was incredibly proud of our frontline staff that understanding the risk at that time turned up to work to ensure what goods we could ship for our clients, we did.
Utah is booming we have secured our second large account which means we have already blown capacity on our initial facility and are moving into a new facility next month that is 2.5X larger. We launched our 3pl in late Mar this year with 2 FTE doing about a hundred orders a day a few weeks later we were cracking 5000 orders a day with 30 staff. Kim was working 20 hours a day 7 days a week it was manic (just like the old days). The order volumes are now back down to hundreds not thousands however over Xmas we expect to be seeing north of 10,000 order days and with the new clients we expect the new facility will see us regularly processing orders in the 4 figures range, daily. Michelle and I fell in love with Utah and can’t wait to head back to the amazing state of Utah and see the wonderful staff we have been lucky to employ – by USA standards Utah is unique in a totally wonderful way and we have been humbled by the quality of staff we have discovered there.
Amsterdam. Michelle and I are off to Amsterdam in November with the goal of having our European branch open for business in Jan 2020. We can’t wait.
From there we plan to roll out Japan, Canada and UK next year. Our global play is essentially a b2c solution but we do some b2b as well, the value proposition is our unique technology, know-how and capability in 3PL augmented by Glass Elephant that has special capability in the word of Digital Commerce to help brands establish and scale large on-line sales channels through mainly FB and IG. We realised with the incredible success of the account we launched in the USA last year that we have a special formula, when we launched SCS in the USA we were surprised to find how advanced our Kiwi based 3PL technology and processes were. There are some pretty flash front end portals in the USA but no one we’ve spoken to has seen anything as advanced in the back end of the operation in the 3PL space and our experience is that these flashy solutions fail to deliver at teh pointy end with clients often finding themselves days and weeks behind on orders…. learning how to eke out a living in a hyper-competitive market like NZ is proving to have huge advantages in larger economies.
SCS launched in Christchurch finally a couple of months ago and we are delighted to include Dave and Brannan to the SCS family. We’ve resisted the pressure to set up in CHH for many years but a couple of clients finally got us over the line and we’re loving having a footprint in one of the most beautiful cities in the country and being able to work with clients under a single solution.
PaT (People and Teams) is the Operational Integrity Platform I have been building on the side for 6 years now, I started selling it then stopped about 3 years ago as I realized it needed a lot of work on functionality and speed to realize the vision I have for it. We are now on track to release PaT 2.0 n November and I am super excited about the functionality, we have a stunning mobile app version that will be released next week for Android and iOS, the new speed enhancements are epic and the look and feel has come leaps and bounds. I run 9 companies now and spend half my day in PaT creating tasks, managing projects, sharing files and videos, building out training content, and ensuring our H&S is world-class. Without PaT I’d need a lot more staff to achieve what I do.
Glass Elephant continues to boom, we are blowing up everyone one of our clients and helping them build on-line sales channels better than anyone in the market. I launched GE last year with 3 staff, we now have 46 including 24 in the Philipines. We lucked in hiring Matt Headland as our COO, Matt is a powerhouse of a chap, previously CMO of NZME last year Matt also ran EMI in his late 20’s, he brings formidable staff leadership and media knowledge and capability to our dynamic Digital Agency business. In Jan we acquired 50% of Kollab, a great little content agency which we grew in 6 months with Kennedy (the enigmatic founder- he just recently turned 22!) from a break-even to a profitable business, Kennedy and his wonderful team have this week fully assimilated into the GE Digital Agency under a new restructure which we expect will deliver even greater results for our clients as we merge Creative with Clients services and Digital in a more streamlined manner.
Merging the capabilities of SCS (3/4PL, Global forwarding, Consulting, IT) and GE (Digital Agency, Web Development, Content/Creative) we have decided on the name Magnitude Group. When building GE, Simo (my partner in GE) and I devised a business methodology called Magnitude that challenges and rebuilds a business model to deliver more profit, market authenticity (biggest consumer group is now Millenials and not everyone has gotten that) and systemization. Results have been phenomenal including the creation of a number of new 6, 7 and 8 figure business channels both for existing businesses and start-ups. We are now working on a combined approach to the market under the Magnitude Group banner.
Staff tenure OMG we have had that many 5, 10 and 15 year announcements this year I have lost count, over 20…its insane. Before starting SCS the longest I held down a job was 3 years it does my head in to see so many wonderful staff hang around so long. Many people have grown up at SCS, got married, bought houses and raised families. It’s weird, SCS is the highest paying 3PL in NZ today, it’s now a great career when I started it was low paying job, mostly thankless, physically hard work, crazy hours and demanding. It’s still physically hard work and demanding but our customers are a lot more grateful, the pay is now good to great, the crazy hours don’t exist like they used to (I worked over 100 hours a week for 3 months solid at one stage and other staff had similar war stories – Kim still does haha) but we still have that mentality baked into our psyche that when the call goes out from a customer we respond and phone the partner apologize and explain we’ll be missing dinner. Which I love. It’s our customer centricity that got us here and will continue to get us there. Without customers, we don’t exist. Customers are everything. We have the best customers, many have evolved into great partnerships and some have developed into friendships for which I am ever grateful. There are also lots of customers I have not seen for months and years, I feel guilty about this but happy knowing they are being looked after by an amazing team and I love getting the odd call even if it is a grumpy one so I can sort an issue and catch up. One thing I love about SCS and I think our client’s value is that anyone can call the owner and have a yarn to sort out an issue and they know they will get a sympathetic ear and a fast result because I care about your business as much as you do.
I used to get very upset when a good staff member left, I had failed them, the stress was too high for them, I hadn’t managed a staff dispute brilliantly, I had let them down…over the years tho we realized that a disproportionate number of really good staff would come back. Phil started a notebook of good staff that left, I recall it had about 20 and a few years later 16 had returned. It’s now a joke that all the good staff comes back. When a great staff member leaves I always say see you soon. And I’m usually right. We don’t always get it right, staff are hard work themselves often and as managers we are fallible but we try, hard. The greatest thing about SCS is the people. The quality and caliber of staff at SCS humble me like nothing else..If I’m ever stressed all I do is go walkabout and have a chat with them, I feed off the morale, the humor and the duty of care they show to the business and our clients.
To our valued clients, thank you for your support, thank you for being part of our story and allowing us to be part of yours.