Why is this interesting?
12% overall drop in shipping costs to our clients.
Packages delivered an average of 11.5 hours faster than our location in Ohio.
Packages can be shipped as late as 10 PM, same-day.
When we started talking about relocating our business late last year, one issue kept cropping up:
Our clients’ shipments could not be interrupted.
After a lot of research and number-crunching, we thought it might be possible to move the whole operation during a weekend. That was good enough for us. We choose a 48 hour period in August and started planning the move in March 2017.
During that time period, we told a lot of people about our plans, and it usually got a kind of stare from them that carried the nonverbal message of: “Are you insane?”
The answer is, of course: Yes, we are insane and we take our client’s shipping process very seriously. We have 48 hours.
Motivation for the move
Ohio was a great home for a long time, but it wasn’t an ideal location for a fulfillment center. Our geographical location came with a number of drawbacks, but it mostly boiled down to three major points:
- We needed and continue to need high-quality and high-capacity shipping infrastructure to meet our delivery targets. The carrier infrastructure (airports, distribution hubs, routes, etc) available to us in Ohio was obviously going to start limiting our capabilities by early 2018.
- The entire west coast of the United States was Zone 8 for us, the most expensive shipping zone. Packages to California and Hawaii cost approximately the same. This was unacceptable.
- The closest carrier distribution center to us was a USPS facility in Akron, 45 minutes away. This created unnecessary delays and gave us very early cutoff times. Additionally, I can’t even count the number of times we ruined our local postal carrier’s day with our excessive number of packages for their relatively residential route.
Finding our new home
We had been mulling over these problems for quite some time in late 2016 and one night, over dinner, something occurred to us:
Might there be locations that have special privileges with certain carriers? Is there a single, best location in the United States for a fulfillment center?
To answer this question, we first started consulting USPS zone maps of the United States. With the way carriers assess shipment costs with respect to distance, there should exist a single place in the country that has the lowest overall shipping costs. We found it.
Somewhere near the middle of Kansas, this zip code offers the lowest overall shipping rates to every address in the United States. Unfortunately, this location also has an incredibly high incidence of tornadoes.
So we scrapped that particular location and started focusing on identifying carrier resources in the surrounding states.
We’ve all had a certain fascination with the FedEx Express overnight service for quite some time and had noticed something strange about most of the packages we sent with that method. Most of them made a stop in Memphis, Tennessee. Ohio to Florida: stops in Memphis. Ohio to LA: stops in Memphis. Even a handful of Ohio to NYC went through Memphis.
What made this even more interesting was our knowledge that many, if not most, USPS priority shipments make the aerial portion of their journey on FedEx planes. We checked out a bunch of our priority shipments, and don’t you know, many were going through Memphis.
What would these shipments look like if our packages started in Memphis? Upon realizing all this, we said to ourselves:
We need to go see what’s in Memphis.
We flew down here and looked for ourselves. I don’t know if many of you have gone through the Memphis International Airport; for those of you who haven’t, it’s massive. And it’s about 75% FedEx. Trying to count FedEx jets while we were arriving, I lost count at around 100.
Most carriers will say they have a “hub” or a “distribution center”; FedEx has a Super-Hub. The name is deserved.
We had our new location.
By August 1st, the papers were all settled and the date was set. In the two weeks leading up to the move, we all worked 18 hour days nonstop. The first trailer had arrived and we started panicking about whether or not we’d have enough space. It did not help that we had a surprise delivery of 10 pallets about 2 days before we were set to depart.
There was some panic when we realized that we had no idea how to get our pallet stacker into the trucks since we had no lift gates. We called around and a local towing company sent us a tilt-flatbed truck. He winched the stacker on the bed and we sped it up a plywood ramp in a stunt that Evel Knievel would have been proud of.
The morning of the move, we woke up at 7 AM. I don’t think I’ve ever been so tired or worried. We did the days work and utterly rushed through packing up our personal effects throughout the day.
At roughly 11 PM that night, we officially closed the Ohio warehouse and hit the road. 14 grueling hours later, we arrived at our new building.
Was it worth it? You tell me: