White glove delivery allows trucking companies to increase their services
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The COVID-19 pandemic and its lingering effects have forced some innovations in the industry, including in the last mile delivery segment. In this segment, white glove delivery service has become a viable growth area for trucking companies. With this growth potential, logistics companies have explored the last mile space to add white glove delivery services in which the delivery team unpacks and assembles items.
Last mile delivery has proven to be a staple for most homes in North America, with a market size valued at over $40 billion in 2021. With the rise of e-commerce in many segments like heavy equipment and food delivery, some analysts say the last mile segment is expected to grow more than 13% annually.
High-end delivery companies offer a wide range of specialized customer services, depending on their needs. Many services are customized for the specific client and situation. The intended marketing message is that white glove service goes beyond standard delivery. While the term “white glove” may conjure up images of a butler, it’s broader in the types of services that can be provided.
A Penske fridge on the road. Penske trains its drivers regionally due to the specialized nature of the services. (Penske)
Jeff Jackson, executive vice president of operations at Penske Logistics, said his operation deals with the “B2B last mile” with a significant portion of services in the food and beverage and grocery industries.
“For us, it’s tough deliveries when you’re on a manual truck, maybe you’re going through a mall or the physical conditions are tough to navigate,” he said. “We have a client who we throw donuts into and bring them fresh donuts to a gas station. We do this while they are open. They are great customers and we deliver to 1,000 stores per night.
Jackson says Penske also delivers medical equipment and supplies to hospitals with white glove service. He noted that many hospitals don’t have the inventories they used to have. So many deliveries are just in time.
“We can deliver to four different delivery points within a hospital,” Jackson said. “We will make a delivery to the surgery center, intensive care and possibly the emergency room. We could be in the hospital for over two hours.
Another white glove feature is logistics – the more complex it is, the more premium the service. For example, delivering fresh food and stocking a convenience store while it’s open allows that customer’s staff to focus on customer service. According to Jackson, this is one way to differentiate a white glove delivery from a standard dockside delivery.
Seko Live connects drivers, technicians and customers with live support.
Brian Bourke, Director of Growth at Seko Logistics, says they have been providing white glove services for several decades. However, they continue to evolve and expand as requirements change. Bourke noted that some of the more recent improvements have been in technology for field service and support.
“We launched a new technology called Seko Live which gives us the ability to connect drivers, technicians and customers to live support with experts on a specific product or feature with on-demand video streaming,” said he declared.
Penske’s Jackson says the driver shortage has been exacerbated by COVID-19 and supply chain constraints and challenges. The trucking company had a significant wage squeeze, from basic driving duties to more strenuous work with white gloves.
“It’s hard physical work, usually. So there is a premium,” he said. “We had to go back and bring the drivers up, but we had significant challenges with recruiting high-touch white gloves in the first year of COVID-19. However, our group recovered salaries and got a better handle on the compression problem, but that was a challenge for a while.
Penske has invested heavily in recruiting drivers to fill white glove positions. In January, the company had 1,400 driver openings. Penske has held more than 600 positions this year.
“[This was achieved] on a driving force approaching 11,000,” Jackson said. “Our comfort level with over 10,000 drivers is maybe 500 openings or 5%. We’re getting close to that, so it’s better. I think we’ve been more aggressive than most with salaries. We don’t are not out of the woods, but much better than at the beginning of the year.
He added that Penske trains its drivers regionally due to the specialized nature of the services.
“For example, we deliver milk to grocery stores. Milk is a difficult delivery unit to know how to deliver. And when the milk spills, you have to know what to do,” he continued. “Putting a cold driver to deliver milk will not work. So we’ll have drivers in the area trained to do that and then we’ll pay them a premium.
Penske also brings in what Jackson calls its “elite team of pilots” who travel to the scene to fill in the gaps. “We train them to do different things – lots of very sensitive things like grocery shopping, ready meals or whatever. So you have to have reinforcements and trained people.
Shelves are stocked with Coke products in a Philadelphia supermarket. Trucking companies face challenges when launching white glove services. (Matt Rourke/Associated Press)
Seko is also seeing growth in the white glove segment, handling items ranging from medical equipment to automotive parts in the B2B space. In the consumer space, it can be high-value items from companies like Walmart, Amazon, and even Peloton (which recently signed up for third-party white-glove services with Amazon).
“Shippers expect any business to be able to deliver premium nationally or even globally, and that can be a challenge for anyone just starting out,” Seko’s Bourke says. “Additionally, delivering exercise equipment to a home or an integrated server rack in a data center are just two examples of how white glove services can be diversified, so it’s important to focus on certain aspects based solely on ability.”
Some delivery services may not match white glove deliveries. While white glove services are another avenue for increasing revenue, there are plenty of caveats. It can do more harm than good if it’s outside of a company’s area of expertise or if a company lacks well-trained, well-paid drivers to execute complex deliveries. Larger fleets have found it more viable due to their infrastructure and ability to manage and deliver complex equipment.
A driver delivers to a Dunkin’ store in Bowie, Md. (Peggy Smith/Transport Topics)
“You have to have solid training, though. You must have permanent operating procedures and need rigor and discipline to execute them, because it is complex. Not every organization has this in their DNA or even just the resources behind them to support an operation like this with training and things as basic as the job description,” Jackson said. “There is critical attention to these jobs. And you want the customer to know what they’re getting into.
A worker stores fresh vegetables in the produce section. (jacoblund via Getty Images)
As trucking companies add white glove services, they encounter initial challenges, but there are also many upsides as fleets find a niche that suits experience level. Most consumers are more confident in ordering items online, while B2B and B2C customers are increasingly inclined to get timely delivery to their doorsteps. With last mile deliveries rejuvenating sales for many companies, fleets are scrambling to meet the expectations of these customers in the post-pandemic era.
Even after the world began to return to normal functioning, online shopping and e-commerce platforms are expected to maintain momentum in the global last mile delivery market as more and more key players anticipate to use white glove services as a means of security and effectively reach their premium customers in niche segments.
“We’ve seen significant growth in the perishables and beverages space,” says Jackson. “And we also manage auto parts for all the major OEMs in the United States. Every day we deliver to 7,000 dealers when they’re not around. For the most part we ride in cages after hours so we have the keys from the dealership. This is an important operation for us, and we have also experienced significant growth in this segment over the past two years.
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