How the Trucking and Logistics Businesses Work
Welcome. To industry focus the podcast that dives in a different sector of the stock market every day today, is Thursday December 13th, and we're discussing logistics, I'm your host Nick cycle and today I'm joined in studio by Motley Fool contributor Dan Klein how you Indian hey Nick can't we do this at my house with more it's. 32, degrees here. Virginia. It's 81, in West Palm Beach yeah, tell me about it Danny you know you're. Coming down from West Palm Beach I'm Clement just someone who grew up in the South not ready for this weather and I'll tell you it's not just that it's cold we're, getting up to 20 mile-per-hour gusts the winds up here so it's it's not only freezing, cold it's freezing cold cut through your jacket make you miserable miserable, weather, so you know I'm a little jealousy you getting back good to go back home to Florida I have a guest room there's a blow-up for Austin we could totally work this out yeah, let's set it up let's get some mics down there and and make it happen but, anyway it's good to have you on dan and we're yeah. And and we're, following up on our show we did a couple weeks ago you know on trucking and of the shortages there and we're gonna do a little bit of a follow-up on. Kind of what we're seeing after, this holiday season. In. Those those channels and what it kind of means for us going forward but first off the bad Dan I just wanted to get your thoughts based. On data we got released last Thursday, December 6th, the u.s. exported, more oil than imported, for the first time ever in. That in the last week of November and, they exported, 211. Thousand barrels per day you. Know we don't the go into investing here Dan but just as a US citizen well, what does this mean that we're exporting or a net exporter of oil here in the United States so a little older than you I literally. Remember gasoline. Shortages, now I I wasn't driving back then but I I remember the news stories so, this is stunning on the other hand, we. Are coming very late to the party we, are now the masters of something, that's, like what ten years away from being somewhat, irrelevant we, are we are rapidly, getting. Rid of our need for for, oil and gasoline that's. True I mean we're probably you know over the next you know a couple decades gonna, start to see you know demand start to start to roll off it it's. Very remarkable just you know how. Way we have these supplies particularly, in the shale industry that you know we didn't even know we could get to for the longest time and now we're, in that exporter, I mean just three years ago President, Obama you know back in 2015, lifted. What had been a ban on oil exports going back to the as you mentioned the oil crisis. Under. The Carter Administration, and, you. Know it's just in this past three years we've gone from it being illegal to export to being in that exporter of oil so it's just really you know an interesting, phenomenon. Going on a lot to see how that plays out every time I think there is an investing take away look, at research and development, you, know if there are companies that are saying hey here's a resource that's trapped we think we can get it out that might, be a good long-term play, that's. Exactly right dan, let's. Pivot into our main topic for today which is talking a little bit about what's, going on in logistics, and really, putting that into context, with what's going on with holiday, sales so. We're seeing store visits being down about 1.7. Percent according to shopper Trek data but. Digital sales however have been up twenty. Three point six percent on on Black Friday, consumers. Spent. More than twenty six point six 1 billion dollars online between November 21st and November 26, according. To Adobe Systems how, have. Retailers. In just the logistics infrastructure absorbed, this you know spike in demand for the holiday season particularly. Online spending, well, I mean they've they've. Tried to flatten, the season out if. You remember, it used to be, Black. Friday that, was the day people lined up at stores then. It became Thanksgiving. Now, starting. November 1st you, were starting to see sales so, I wouldn't. Think that much about the. Store traffic being down we. Don't have hard numbers but sales were actually up so the people who went to stores were more likely to be buying like a television, or a refrigerator or something you actually wanted to see and in, terms of online they're.
Trying To funnel you into certain items if you look at Amazon who breaks down some of what they sold all of their top sellers like 9 of 10 or Amazon, items so, they. Know how many they have they are pushing you to those they are heavily discounting, to getting you to make decisions, they're, slimming, down the, merchandise, that you can easily find on sale so. They have a lot of whatever it is you're buying the days of shortages, have gone away no nobody's, punching, each other at a Walmart, over a TV anymore or not nobody but very few people are doing it yeah, you're right Deana we've, seen some trends of kind of spreading out promotions, where in the past that have been all kind of front-loaded on Black Friday. You know now we're seeing online, spending on the Wednesday before Thanksgiving was, up 31 percent it was up 28% on Thanksgiving, itself and you compare that to what we think of as the the big shopping day, Black Friday was only up 23.6%. Cyber, monday was only up about 20% so so we're really seeing this. Nudge towards, consumers. Kind of spreading out that cyst you know that the holiday purchases so, we're not you. Know getting it kind of getting everything front loaded in one period there really stretch our infrastructure, and some of it's purely mechanical so. Amazon has always or at least for last few years had a hundred, million prime subscribers, people that could just hit a button and order. Walmart. Is sort of in the beginning stages when, they went to free shipping which is a little over a year ago now remember the exact date that. Captured, data for them that was more people putting credit cards on file Target, offered free shipping through the holiday season there, are more, digital, retailers where you can buy from easily like all three, of those have my data eBay has my dad are probably a number of specialty places, the. Hesitation, to shop online on the holidays was. When, I see it on my phone but do I want to sit here and type in my credit card number my address all now, that that has really become easy, and sometimes you could do it with Apple pay and with with with other sort of automated payment methods it's, taken, away one of the major barriers, so, people who used to like use their phone as a shopping tool as a catalog, they're, just completing the sale now and that's you know that's taking people out of stores which is a good thing if. You're in line at a store not, a great thing if you're waiting, for something to be delivered via truck sure. Yeah it's like we talked about in the last show Dan it's just it's much more complicated to, deliver dozens. Of shipments to individual homes and it is to deliver one big massive, shipment. To. One two. To one store and another. Trend we're kind of seeing we mentioned kind of spreading out these promotions, we're also seeing a little bit of nudging towards, these pick up pick. Up in store delivery, from store options and again the end that's what you were talking about what, kind of at the same trend we're talking about it's much easier to deliver a big chunk of goods to one place and then distribute from there than, it is to kind of do, a thousand, different individual. One or two box shipments, and let's call this a, nascent. Technology, the pickup in store yes, so I live, in two different places so I'm in a number of different Walmart's and targets and they, have redone, the Walmart and Target where, we are in Davenport, Florida, when. You walk in there there's like it's like a doctor's office you enter your your barcode, and it shows you your number and you know exactly if. You go to the one in West Palm Beach which, just has the pickup tower it's, utter chaos nobody. Knows what's going on your, item might not be there I told you we ordered something in store that, was physically in the store and it took five days to get it I had, to go believe obviously I didn't stay there for five days head heel back and get it so, these. Things are developing. And they're becoming more than norm people, are becoming, more comfortable with them but, there were a lot, of bumps in that process this year yeah.
It's, Something that is still developing and. Like you had mentioned before we talked about before the show how, you. Know these, traditional, retailers the Walmarts and the targets of the world have, really. Struggled. Maybe a little bit more than, some of the online-only retailers. Integrating. This new kind of omni-channel system, and you know maybe that's because as we mentioned there, used to this legacy, you know a regime, of, having getting, all their goods shipped, to. Their store and that supply chain mechanism and then that transition, has been a little bit of a little bit of a bumpy ride putting a TV on a shelf is a lot easier than looking at the TV and the warehouse and going well Nick wants one he's. Gonna come in in a couple hours Dan, wants one but please bring it to his house and. These three other people probably will buy it off the shelf so, the. It's, more complicated now than it once was and I think you also have to look at that, this is maybe year, two of this being a technology of people using it at all so. Amazon in, terms of just it's pure delivery, model is a, few years ahead of where Walmart and Target are so, I think you're gonna there, were growing pains this year there's there's no other way anybody. Who's ordered has gotten weird boxes, and orders. That come early and late and you know you guys at the office send me eight days of Hanukkah gifts, spaced out over eight days and four of them showed up on the same day so. We're. Seeing some problems, but, really not as bad as I expected, yeah. You're right Deanna and let's talk about -. What's. Going on with this these traditional. Logistics, companies. So FedEx and UPS. FedEx. UPS and the Postal Service actually collectively, have, in spite of this increased, demand log. Near best on-time, delivery performance since 2013. According. To ship matrix which, is a software. Provider they analyzed shipping data UPS, delivered ninety eight point three percent of its packages on time while FedEx and USPS had, on-time delivery rates of ninety eight point nine percent and, ninety seven point nine percent respectively, so, what we're looking at here Dan is you know while there may be some struggles. In these retailers whether from their omni-channel perspective, these. Traditional, logistics. Folks have really done a good job you know absorbing, this demand they learn their lesson I mean, last year whether who was more of a contributing, factor and we could still have storms, that screw everything up and there's absolutely no, way FedEx, can plan for you, know the storm we had this week in the in the Midwest like that's, not, expected people are gonna get some packages, late but, last year there were a number of problems there were Amazon orders coming after Christmas there were this. Year they threw people at the problem you know we were both talking about an article we saw in the Wall Street Journal or earlier that they're hiring tens, of thousands of people even now so. They. Weren't going to just you, know take this and say well maybe we'll get it right they threw a lot of money at it and that's probably. Expensive it's probably an earth the margins for those companies but, from a reputation. Point of view it is much better to get it right, yes. DNA I sauce, to some some interesting you know kind of data from from FedEx that they've, been really working closely with retailers, to kind of plan out demand, so. They've, also even like put some limits on how much individual, real retailers, can put into their, shipping Network to kind of prevent them from becoming overstrain. That's. Kind of a trend we're seeing where these logistics providers and, the retailers are really having to work together to. Make sure you know all. The goods get where they need to be when they're supposed to get there I think it's also worth it to like step back as consumers, so if I send you a gift that you're really waiting for and it's, the only gift, FedEx, delivers incorrectly, all year, you. Are going to have a negative perception, of FedEx so, this this is not a zero-sum, game 98.3%. Is still, gonna come with a fair amount of negative feedback for, these companies, all. Right in an edition these cooperations, that we're seeing between these you know FedEx, UPS these traditional, logistics, providers, you know we mentioned spreading. Out promotions, that some of these retailers have done we've. Also seen some kind of interesting, maneuvers. To open. Up new, logistics, kind, of capacity that. Maybe it hasn't been used in the past and one of the examples that you know I've been reading about is Amazon. Has started on, vacant, patches of land that they have near near their real estate near their, logistics. Centers they. Have started. Running some of their operations out of large tents oh I know we saw that we saw that with Tesla with their factory there they add an additional assembly line out of a tent well tents are hot in the streets right now Amazon, is doing them as well what can you talk about what.
These Kind of operations are adding to them from a logistics, so logistical, perspective I think it's very important, because Amazon, is changing, how these companies think Walmart. And we've talked about some of my Walmart issues has, always had that this is our process follow, our process. Amazon. Takes a we're getting it to you in two days because that's what we promised, so, you, talked about the tents it's not just that they've set up added facilities, they're. Also bringing in temporary, workforces. Basically. If they have to strap your package, to a carrier. Pidgeon to get it to you they're, open, to that and that's forcing, Walmart. And Target to take a little bit more of that attitude of okay, this isn't about our system, and isn't about what we're gonna do next year it's, about how do we get this package delivered, so if our, manager. Has to put it in the backseat of his car and we've, all seen people in our neighborhoods delivering, Amazon packages, that are barely, identified. As working for Amazon a sticker, on the window of the car sometimes, which is a little creepy but they've, really taken the attitude that the result, matters and I think much, like with Tesla it was important to get the five thousand cars number here. If you, want consumers to have faith that this is going to work and Christmas, gifts arriving, on time is very, very important, to people you. Have to be willing to do whatever it takes even if you lose money on that delivery. Right. D and, it's not even not only something that's coming around for the holiday season alone. As well I mean we're seeing a. Jol, which is a real estate firm based out of Chicago, they're, converting, a parking garage that over 3.8 million square feet in the middle of Chicago, under an the Millennium Park and the logistics facility, for retailers to use we're seeing some, conversion, of properties in the in middle of downtown New York City there are old unused structures, and turning, them into into logistics. Vehicles. Basically. So. We're really seeing just a. Both. Both you know in the short term kind of making things work over the holiday season and then in longer term putting, these logistical. Facilities. As close, to the customers they can so in the middle of Chicago in, the middle of New York and it's, something we're gonna we're gonna continue, to see developing where there's a little growing pains with the tents but, what, do you see long-term how, these, these infrastructures, are gonna get built out to get everything as close to the customer as possible well I think they need to know their data more, and obviously if you're Amazon you can use Whole Foods you, can use some of the coles they have relationships, with so, as they start to build the holiday data a year after year after year they, in theory can have what you're gonna buy closer, to where you are they. Can also build, their sort of flexible, capacity relationships. So. Our Davenport, house has a Walmart, and an Amazon Fulfillment Center on the same Road and usually. When I Drive down that road I see like 10, 12 Amazon, Prime tractor, trailers all with the Amazon logo now. You see like 40 50 tractor, trailers overnight but most of them aren't amazon anymore so they're clearly flexing. Out their workspace and building relationships we've seen obviously the price of trucking has gone up they're paying dearly for that and that's gonna hurt margins it's gonna rise prices, its but. As that. Happens next year they might realize yes we can fully add, 15. More Amazon branded trucks at a cheaper price which. Will logistically, work and we'll need them at the holidays, right. Deana me it's definitely an interesting phenomenon, to pay attention to you going forward okay. Dan on the back of the show as I mentioned we're gonna talk a little about what's going on from a macro, perspective affecting.
Logistics. And shipping and the first thing I want to talk about is tariffs, of course, you know we've had several. Rounds you know it's a big big big big. Issues, here but you. Know we've had several rounds of tariffs this year, the. Most recent or the most recent news that we got was. An agreement between President, Trump and. President, Xi of China to kind. Of declare. A ceasefire and, what had been has been an ongoing trade. Spat between the countries that would delay increases. On. Tariffs. Which are currently ten percent which would were set to increase to 25 percent January first it's, going to delay that tariff increase until for at least 90 days to, continue, kind. Of negotiations, with, that trade dispute, as. A result of these tariffs, we've really seen a surging. We would have expected to see the. The. Trade deficit between the US and China to shrink as a result of tariffs actually we have seen it surge, in a very significant, way over, the past few months it in October, it hit the highest that had ever been at 43 point 1 billion dollars. And. Part, of that has come because, this, expectation, for tariffs to increase, on January 1st, to 25%, has incentivized. A lot of exporters, in China and a lot of importers, in the United States to front-load, their, shipments, to beat that increase in tariffs now that we're not seeing that increase what, does that mean for us retailers, and for logistics providers you know I'll toss the world it's a problem so, you. Bought a lot of I don't know shovels you bought a lot of shovels at $10, because you didn't want to pay $12, for them now. They, might not cost $12. And. You've tied up all that money and your, shovels, let's. Hope they sell but, what, if you over ordered what if your stockpile, and, demand. Doesn't say you're gonna have some dead inventory you're, gonna have some inventory that maybe they make up a little bit because they sell it after the holiday season at a good price but.
People, Hedged against, uncertainty, and there's, still a ton of uncertainty. Yeah. We, still don't know if when 90 days come around that these aren't gonna get jacked up again and then another factor to think about Dan to is that it. Wasn't just one retailer, doing this as large. Numbers of US retailers, all looking. To get their goods to market before, this January first increase, while. There's only a limited supply of logistics, infrastructure to make that happen so I'm sure they paid a little bit higher race to, make that stuff and get here that, ended up not being necessary, so when you run a smaller retailer, which is we've talked about I ran a toy, store that did a couple million dollars in sales a year you, have to make your Christmas decisions. In this summer, so. You were. Staking out your inventory, your Lego, is your your stuff that's gonna sell so. If you decided, this is not a bigger problem at Walmart or Target so. Let's say I banked, on I'm, gonna buy a bunch of Han Solo Star, Wars Legos for my toy store and then, the movie tanks that's. What's kind of happening here people had two stores, that don't normally have to make big bets in advance had, to make big bets in advance so. If those, bets were right it won't matter it'll probably all even out in terms of the pricing but the reality, is that's not how it happens if you're Walmart you can make a relatively, small bet for Walmart and then just order more instead. They, are chock full of stuff and we will probably see a slowdown a pretty, big slowdown in ordering in in, the first quarter, right. Dan cuz I mean this, inventory. That we had built up it's gonna have to roll off you know before we can really make a meaningful. Meaningful. New investments, in inventory and without being too political, you, can say 90 days but I think we're at at a time where every. One of us in this space wakes up in the morning and checks the news to make sure nothing crazy happened. You, know war, with Canada invaded. Mexico who knows so. That, as a buyer, as a national, or a global, retail. Chain that has to weigh very heavily on, every decision you make right. As you mentioned Dan just businesses, really don't like uncertainty we see that in the stock market as uncertainty, Rises we see more volatility and we see that in in the in these logistics, infrastructures, and just as kind of an aside this is not a problem that is unique to the United States we're, seeing a very similar problem in Britain ahead of brexit, where, they have had a massive. Demand. Increase, for storage facilities, in anticipation, of brexit. Disrupting. A lot of a lot of the trading relationships, in that region and so we've, seen retailers over there stockpile, on inventory, and stockpile on storage. There so and. It. Just it's creates a difficult situation for businesses you're getting a one-two punch here, because you're you have all this inventory that you also have all the logistics, and the increased trucking of the season so, moving. All this stuff around is more expensive, it would be cheaper, to order stuff for delivery February. Second than to get it December, second so, you're adding to the cost and. Some, items you can price, higher some. Items, consumers, are only gonna pay what they're willing to pay so if Amazon holds, the line and, paper. Towels are 399, you're not gonna get 599, at Walmart for them it's a terrible example nobody, knows what paper towels cost. It's. Okay I think. I think what we want we want listeners, to take away here from this tariff is, that, yes it is great news that. We're getting a delay an increase of these. Tariffs it's gonna it's gonna probably, be good for consumers and then they're not gonna pay higher, rates and they would have in the past however. Businesses. Took steps, assuming. That these these things were going to be in place they. Realize. Some expenses, they did not have to to, prepare, for these circumstances and, the. Premium they paid for goods to get that in them here quicker, in. Anticipation, of these tariffs is extra, money they're not going to get back and we haven't heard on some of our other podcasts talking about you know when weather comes through and restaurants, don't get sales those sales aren't going to come back the same way paying. For these goods to get to market you're.
Not Going to get that back in margins so it's. Something you think about in, the in the context of tariffs and in the context of shipping in general I think as an investor, as you look at these companies, you. Really want to look at same store sales an. Increase, of sales you're not gonna look at cost of goods sold because, it's an anomaly, we are not gonna have this uncertainty, forever, at some point we're. Gonna sort out the tariffs we're gonna create, some sort of now there's other instability. At times in the past gas prices, have created pricing instability, but, this. Is a real wild, card that you probably have to back out some of this expense when you look at the health of an actual company I. Totally. Agree with you here Dan and let's talk about another wild card that's kind of been thrown in again. Again, from the executive, branch, there's. Currently a Treasury led task force that is proposing the, US Postal Service should, charge more for, their. Package deliveries, the cat the task force has reported, that the Postal Service does not price its package deliveries in a way that focuses on profits and therefore, that, the, Postal Service should look at increasing their rates to more. Of a market-based, rate. So. What are you what's your instant response a reaction to this Dan doesn't that tell you everything. That's wrong with government. Agencies, like can, you imagine if I said hey Nick I'm starting a business it's a it's. A butcher shop and I'm, not gonna price the meat based on the cost of the meat. On. Tuesday, the, veal. Chops are free it. Just makes no sense so. And I know there, are laws there it's not easy for the post office to, increase, prices but, very, clearly, any sensible. Person would say. That that whether. It's Amazon whether whoever it is should. Be paying at. Least the cost of the service now, obviously.
There, Are some deals like the Amazon, delivery on Sunday through the USPS, is profitable, they, have negotiated a deal where, because they are serving one customer, in a very specific way it, makes money so, they need to figure out how. To price the rest of their service and that's, going to change some things too because, if you raise the cost of shipping it. Might be beneficial to go to a store and you'll see more of what Walmart does where, they will say we, will sell this to you and ship it to you for. This price but if you come get it it's that price and, that's. Not something Amazon, can do easily but. Amazon, has the volume to. Negotiate, things like their Sunday deal or to say all right you're gonna raise prices we're gonna build our own shipping Network. Right. Ian just. Just to give a little context, on Amazon, according. To Morgan Stanley, Amazon, relies on the Postal Service to deliver about 45%. Of its packages, so it's you, know a meaningful, meaningful segment, of. Their business and you know I know part. Of this postal service. Price. Discussion. Has been in, relation, to president, Trump's attitudes towards. Amazon so it's gonna affect them another. Another part of the, industry that we might think it's gonna be affected, is, what FedEx and UPS in that, it might actually be a little, bit of a negative for them. Oftentimes. FedEx. And UPS can use the Postal Service for their last mile delivery as. Those prices increase that's of course going to hurt them. Because. It's gonna increase, the cost of their share also though, higher USPS. Prices, allows, UPS, and FedEx to charge more oh yeah. Exactly I think the analogy that I would have is, you. Think about the federal funds rate we've talked about that the interest rate interest rates being increased over time that, rate for banks is the baseline for interest rates and their their rates are always set relative to that number, well what happens in logistics, as well is UPS. And FedEx and other shippers rates, are set, relative, to, the Postal Service so if we look at the Postal Service increasing, their rates it's, just like the Fed increasing, rates all these shippers down the line get, to increase their rates as well because relative to this baseline, postal service rate you, know and spread, remains because there's no magic, to it it's not like FedEx has like a special, better way to deliver packages then, you, know I mean obviously there's a heavy level of training at FedEx and UPS and they're very efficient, but, they haven't figured out teleportation. Or drone delivery, or any of the things that would be a game-changer so. It's. A fixed cost right. And. Going. Forward on these prices. It's. Unclear, what, form these, price increases, for the Postal Service are going to take we do know at this time that there is going to be an increase on the, USPS, is parcel select service in the range between nine point three percent and twelve point three percent beginning, in the beginning of 2019 and this, service just for context for listeners it allows large shippers to think you're Walmart's, targets of the world to, sort their packages themselves and then deposit them directly to the USPS, for their final delivery so we know for sure that. Large package, shippers will see a nine to twelve percent increase in their rates for that for this service what. Is your reaction to that well, so, do you do buy from Amazon pretty regularly yeah, as, a US citizen I'm probably I'm probably in the vast majority here, as buying Amazon probably, once a week for sure so I order. From Amazon probably. Every day and if. Amazon came to me and said I'm going to increase the price of Prime by 12 percent and. Everybody, else I shipped I order from that sometimes I have to pay shipping said. We're going to pass this on we're gonna raise your prices 15%. I wouldn't. Bat an eye maybe.
Occasionally. I pick, up something in a store, just. To not have to order it to save a time but it wouldn't, factor, in so, unless Amazon said yeah primes 129, now it's 650, I don't. Think this impacts anyone I think this is one of those areas like gas prices, where, consumers, just, it's gonna be a little flexible and I, don't, know do you know what it costs to like FedEx, a box like if you have to finish something you go to the FedEx and do it it costs what it costs you're, right and what. What could be the takeaway here is that given. That this is kind of a marginal, increase and that there is kind of a lot of consumer, surplus to the Amazon Prime offering, to begin with this could be something that just passed on to consumers but it is something to think about in that you. Know these businesses, are going to have to adapt to whether it's passing those prices on to consumers, or making changes their logistics, infrastructure, to, kind of a handle. These costs go I think and we talked about this a little bit before this is going to be a big benefit to brick-and-mortar, retail. Chains that, have very good supply-side logistics. Because, you, are going to be able to know on every item like, Walmart might be able to say I'll ship this to you if you also buy this you, know Amazon has the add-on items that are free, shipping but, only with another order I think, you're gonna see a much more sophisticated, level or Walmart, saying I will, give you something great I'll give you a $5 gift card to come pick this up in the store because, it makes no sense to ship it to you because. You. Know you're a mile away and I have to send it to a post-office that it's gonna get be on a plane before it gets to you so, this, might be a little bit of a blow to Amazon, or might force Amazon, to make some more brick-and-mortar partnerships. Yeah. What, we know for sure is, that. Demand. For e-commerce and, goods, purchased online is, certain, to, increase over the coming years and that, as a result of that the, ability to move things from one place to another particularly. Small. Individual. Shipments, will. Become, even more important, each year and the companies that are able to navigate. Navigate. That dynamic. And to adapt, as things change whether it's what, these tariffs, are with you, know the USPS. Those. Are the companies that are gonna really succeed, going forward I think moving things from place to place is more important today than it maybe has ever been what are your thoughts on just to close there's one more prong of this that we've talked about before and that is. Everybody, is building out some sort of same day shipping capacity. Like, my. Son texted, me when I was was with you at a football game yesterday, how did you order from Chipotle because, my wife was baking and he wanted to pull a so they couldn't go out and I, said it's post mates and my, wife said what the hell is that if, that's not cheese as GrubHub she doesn't know but she's we have instant card it is she so, I had to send her a picture of the app and be like this is how you do it and then I looked at my phone and I have like 15, separate, delivery, apps and like, three, restaurant, chains we deliver from that, you order through them but maybe it shows up and it's super eats or maybe it's post mates or maybe it's who, the heck knows as. Target. And Walmart figure, that out they, will take some stress, off their two day shipping by. Saying no it makes sense to have toothpaste, and toilet paper and cookies. Be in our same day delivery basket, and to incentivize, people because. That's always going to be a smaller pool of items that they there's, less choice they'll push you towards it so there's still that whole one big piece and there's gonna be huge shake outs there they're, not gonna be 15, separate delivery services, in West Palm Beach and in two years and maybe. Even Walmart, and Target won't both make it but, that.
Is Going to sort of change this whole UPS, FEDEX and those are all like guys, in a car kind, of delivery services, so you will see this sort of like gig economy service. Kind of take some stress off, yeah. It's. Gonna be something, that is just remarkable to follow you know over the coming years as just the face of retail continues, to transition, and consumer preferences, continue, to be I want to stay at home and you bring the stuff to me you, businesses figure out how to make that happen so you, know I'm excited to keep falling with you Dan. Exactly. Exactly thanks, again for coming on Dan as. Always people on the program and, companies discussed on the show and the Motley Fool may have formal recommendations for. Or against the stocks discussed so, don't buy or sell anything based solely on what you hear thanks, to Austin Morgan for his work behind the glass for Dan Klein I'm Nick cycle thanks for listening and fool on.
2018-12-20 13:15
