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Paul Jarrett 00:02:00 - 00:02:19
Well, first of all, buckle up. We ready. Let's have some fun. And also, anybody listening to my voice right now, thank you. I appreciate it. So a little bit about Bulu. Let me keep it simple. We say we do the tricky ship that is a playoff of shit.
Paul Jarrett 00:02:19 - 00:03:26
So the tricky ship and really the way that we view that and what we do is we really focus on unlocking a brand's potential through logistics. Because frankly, we started with a subscription box and we grew to 40,060. We sold 40,000 overnight of these subscription boxes one time, and after crushing a few three pls, like, literally imploding them, we were like, we have to figure this out. And as much as we've waited for a company to come along and handle the tricky ship right, which is like, subscription, subscription, returns, retail, it just hasn't really happened. So that's what we're focused on. And we worked with really great brands like Express, you know, the ones that you show to impress people. But I would say that people are shocked when we work with companies that have no minimums, because at the end of the day, if we believe in a product and we believe in the founders and they have growth on their mind, that's who we want. If you want to cut a couple of pennies off a shipping bill, don't call us.
Paul Jarrett 00:03:26 - 00:03:27
How about that? How's that work?
Blaine Bolus 00:03:27 - 00:03:41
I love it. I love it. So let's kind of get into it. So I know you mentioned that you've been working in this space for a while, but why don't you tell me about that first company and what those challenges were, how you drummed up that much demand and what you started to learn from it.
Paul Jarrett 00:03:41 - 00:04:16
Yeah, I would say that really? So I started in the ad agency world, worked in New York City, the big BBDOs. Grey worldwide. Did the San Francisco thing by choice. I wasn't excommunicated from New York. We just wanted to check out San Francisco and caught onto this whole startup thing, which I totally thought was a scam. I grew up in a trailer park in Nebraska, and somebody giving you a million dollars if you don't pay that back, your El Camino gets towed or your Bonavia Single Wide gets towed. So I thought I was getting into some shady stuff. Right.
Paul Jarrett 00:04:16 - 00:05:00
The dudes I was talking to sold their company to Ebay, and I was like, hold up. Tell me what you just did, because that was fast and you're all rich. So totally enamored by that world. We put a deck together. I happened to be I thought he was a sales rep. So there was a guy named Brian Distalberger. He owns Yext Yext.com, and he god bless him, he took me under his wing and really just kind of showed me the ropes, and we raised capital. And I would say that importantly, the thing that gave me the confidence to do that was I was at a company called Complete Nutrition, and we went from three to 83 million in sales in less than two years.
Paul Jarrett 00:05:00 - 00:05:27
And think of a high end GNC vitamin supplement franchise we manufactured. I did over 100 different products, design stores. It was literally like, hey, Paul's dumb enough. He's 26. He'll try it. Take photos of the gap. Try to ask them what they're doing with their store, copy it. It was like total hacky, which is really kind of everything.
Paul Jarrett 00:05:27 - 00:05:56
Right. And that growth in understanding manufacturing. The problem that we learned was sample packets. Samples in stores are like, one of the top ways to convert people to your product. However, nobody was tracking that right correctly. And so we set off to create something that would track samples. We stumbled upon Birchbox. I was like, that's good.
Paul Jarrett 00:05:56 - 00:07:15
I knew that vitamins and supplements are actually a fast follower to makeup. So if it's coconut oil and makeup, it's going to be coconut water, coconut, everything. Else, and vitamins and supplements, and then pets are next, just so you all know. And so I knew how to go to retail stores and see what was selling in makeup and then kind of translate that into vitamins and supplements, right? And we saw the subscription box model, and what I saw was an incredible platform to collect data on, sampling, screw, everything else, which was awesome when you're trying to sell something for a different reason than make a dollar, because you just view it differently, right? And that took off. I would say that our biggest problem that we didn't realize till probably like four or five years in was we didn't think we were losing our ass, but we were losing our ass in fulfillment, logistics, et cetera. I think we did phenomenal in a lot of areas, but we just should have negotiated a little bit better. Just like little things, the nuance of it, right? We knew what we were selling was subscription. We should have been negotiating on the future of the company, not on the current day sales, right? So little weird things like that.
Paul Jarrett 00:07:15 - 00:07:48
And we ended up building a software platform. It's called boolean marketplace. It's been acquired. It's called rangeme.com. LinkedIn.com for consumer packaged goods is really what the concept was. So RangeMe is still alive and well. I'm still kind of loosely part of it. And after the sale of that, we had the subscription box that was selling like crazy, but we're losing a buck every time we sell it, which I think was awesome, because we were getting the data, but just didn't satisfy the venture capitalist appetite.
Paul Jarrett 00:07:48 - 00:08:48
And so we kind of shut up and listened. And what we heard was, a lot of big brands want this. So we started doing subscription boxes for big brands, and we're good and we're fast and there's no BS with us. And once you crank the dial on one or two big brands, they all kind of line up, pandemic hits, and we go, let's just do this straight fulfillment thing. This subscription box thing is good, but it's weird in this pandemic, and people are kicking down our door for fulfillment. And what I tell people is we just got done with not even got done, I'd say about a year ago, we finally looked up and went, okay, that was a crash course in high speed fulfillment. 80% new staff, four new WMS, which is insane. Rebuilt 120,000 square foot warehouse, all in an eight month period.
Paul Jarrett 00:08:48 - 00:09:34
And I say that what we're doing now. Sure, fulfillment, but what we know now is how to unlock a brand's potential so somebody might come to us and we see what they're doing, and they're just thinking, how do I save a buck? How do I save a buck? And we go, Why aren't you doing a three month gift of this? Because based on our data, that's the number one sales item that you don't know that you already have. And so that's what we're doing. And it's been really fun. We're going to have some big announcements where we're going to be in control of 100% of the company. I think I can say that we'll find out. And now we're just really focused on finding those clients. And so many times what that means is we're getting involved in the manufacturing process.
Paul Jarrett 00:09:34 - 00:10:14
And when you're in Nebraska, there's a lot of manufacturing around here, and man, you get that one pound of flour a couple pennies cheaper, you get that label couple pennies cheaper, that adds up quick. And that's really fun for us to work a lot with other entrepreneurs. Sure, we'll do the big brand thing. They pay the bills, they pave the road for how we do things for everybody else. But to essentially offer that to small, medium sized people that haven't shipped a thing, that's been super fulfilling, and I think that's just what we're going to do. We're not going to chase the billion dollar company. It's fun to be in control and make your own money.
Blaine Bolus 00:10:14 - 00:10:57
So tell me a little bit about that, right? You said that there's a lot that goes into the fulfillment process, right. Why don't you tell me what some of those challenges are for a brand that may be looking to start? What are the options? How do they start? Because for our listeners, there's everyone from brands that are totally scaled, that are looking to place massive POS and fulfill at a massive scale to people who are starting a business out of their kitchen or their backyard trying to say, okay, where do I even start? Right? So why don't we start there? For a brand that's just getting set up, what do they need to know about fulfillment, about delivering a product to a customer? Let's just start super basic.
Paul Jarrett 00:10:57 - 00:11:37
So I'm the dude that says the stuff that nobody else wants to hear, but it's true. I'll say what everybody probably feels, thinks, whatever. Most three pls are trying to screw you, right? Like, most of them aren't thinking beyond the sales reps commission. I mean, let's just fucking call it how it is already. I'm so tired of it. Right? So here's what you should know. How do you drive the price down of shipping? There's really three ways, really. Number one is volume, right? But you also need to understand what volume and how to do that.
Paul Jarrett 00:11:37 - 00:12:12
So making sure that you have a product and trying to keep the product similar weights so you can get really good at that, I think is paramount in the beginning, right? Like, just try to keep everything under two pounds. Just do your best. That's an easy way to look at it. If you go big, go over ten pounds, right, and try to identify the carriers, because if you're all over the map, it gets really hard. I understand. Drop ship. I think there's a place for it. But I also think that you will be so much better learning logistics inside and out.
Paul Jarrett 00:12:12 - 00:12:49
The second thing so we got volume. The second thing I would say is I get ship station, pirate ship. I know all those fools. Like I've talked to them. All right, here's the thing. Nothing will beat in talking to reps face to face and arm wrestling them for their commission. I don't encourage people to try to take all of the commission, but I try to encourage people to understand what their goals are, when their goals are, and make sure it's firm and fair. And if you can sell the dream to the carrier and they can see the potential, that's probably the best way to get really good rates.
Paul Jarrett 00:12:49 - 00:13:30
And you want to do all the other things, but you get in tight with like a Ups person or a FedEx person and you get on that personal level. I don't care what anybody says, you can't beat it because they will also tell you things before anybody in the market knows. Right. The third thing is you need to be able to predict how many trucks that you're going to need. That's really difficult. I am all about subscription. Give me any website, any company, any industry and I can tell you why and what they should have on subscription, but I think the term is actually going to more become auto renew because Chewy has kind of put their stamp on that. And I've already seen auto renew being the phrase.
Paul Jarrett 00:13:30 - 00:14:18
So let's just go with that auto renew. But if you can start to understand, and I would say this is one of our big unique things is we understand how many FedEx trucks we're going to need and when we understand Ups, how do we know that the majority of our products are on auto Renew? So we are negotiating on our clients behalf way into the future because we say screw you Ups. Yeah, you heard me Ups. Screw you FedEx. You too, DHL. Don't talk to me. We are going to bring those people in and sit them down and present to them the metrics and the math of where we're going to get brands to where we believe they can be. And that's the price we want one year, two year, three years from now based on data.
Paul Jarrett 00:14:19 - 00:15:06
And I just haven't heard of a lot of other three pls doing that. Everybody will tell you, oh, we use ShipStation, we use this. Sure, we use them all too. Like cool story. What do they not do? Bring in the reps from post office, from wherever, once a month and keep it real with them. Right? I would say that if I wish I had a time machine and I could go back and tell myself what to do, I would say go tour as many local three pls as possible and play the whole poor me, I'm starting tell me because they will talk to you. I think any brand of any size can use a Three PL. I do think it's good to do it yourself in the beginning.
Paul Jarrett 00:15:06 - 00:16:19
But by just merely getting on the floor and seeing what's happening and understanding just that there's human beings sweating, putting blood, sweat and tears getting that thing out, you will think about it different when really what you'll see or should see is you are trying to keep as many footsteps and hand touches down as possible. Right? So if you have stuff coming in at different times, you have stickers that need to be applied, whatever your price is going to go through the roof. If all they have to do is grab the thing, hit the barcode and go out, then you know how to negotiate, how to talk to the people. And if you just go to three and you try to remain some sort of relationship with those people, nobody wants to talk to a Three PL. Nobody wants to be friends with the logistics first. I love it, right. But there's some power in there because they're the last place that's thought about. And like I said, I feel like if you can unlock that and unlock your potential and you just get that call from that Three PL, it's like, hey, there's this thing that one brand was going to do but they backed out.
Paul Jarrett 00:16:21 - 00:16:29
Can you put your product here and can you do this thing XYZ and help them out or whatever? That's where the magic always we see happens for our clients. Yeah.
Blaine Bolus 00:16:29 - 00:17:32
And I think what's so interesting about this space is the fact that at the end of the day, a lot of direct to consumer brands that are in the ecommerce space, so much of the margin and so much of it really comes down to your unit economics and your supply chain. Right. A lot of people start, they set out and they want to build a brand and they want to build an amazing product that changes the world. But at the end of the day, if you can't get it shipped and delivered for a number that makes the business money, it's kind of like what are you doing? So the next question I have is let's think about those people who are starting up. They're starting a brand from scratch, right? You said it's good for you to talk to some Three Pls, maybe handle it in the beginning yourself. At what stage in terms of volume does it make sense to onboard with a three PL? What is your smallest client? But also let's talk about three Pls in general. At what stage and scale do Three PL start to say, okay, it's time to move this from an in house? Like this is acute sort of operation. Get a three PL.
Paul Jarrett 00:17:32 - 00:18:07
Yeah. So probably if you pulled a bunch of industry people, they'd probably say like, oh, 2500 or a month or 5000 a month or something like that. The reality is the same way. Technology is changing just so fast every day. There's three pls that are taking leaps, but there's very few of them. And so the industry is a little bit of mayhem right now. Right? We're watching the I'm coining the phrase pandemic pls, ship, bob ship, whatever the ship they are. Right.
Paul Jarrett 00:18:07 - 00:18:38
I'll call them out, whatever, because I think they're a great fit for some companies, but I think it's a kiss of death for some companies. So it just really depends. So I think that we have people that are doing zero. We have plenty of people that are doing zero. And some of those people I've worked with before, and they're big brands and they're just coming to us. But there's a brand called Paracana. That was Gummy mix for THC and CBD, but it didn't have any of that mix. It was super interesting.
Paul Jarrett 00:18:39 - 00:19:26
The Ralph awesome dude had everything ready, but kind of packaging and distribution were like, oh, whoa, this is interesting. We can help it's a little bit of a gamble. Last time I checked, he's selling on like 52 boutique CBD places and it's just so awesome after a year of just trying to get a few levers pulled to watch him do that. So you can start at zero or whatever is my point there. I would say that we want to talk to people ourselves as early on as we can, because we want to guide them where to go. Nine out of ten times, it's not us. Right? But what I would say is, if it were me, I would make the decision early on, am I going to focus on the brand or am I going to focus on the logistics? Right. Here's the rub to that.
Paul Jarrett 00:19:27 - 00:20:24
Most ecommerce companies don't realize that they're actually a logistics company. And you're kind of like touching on that before, right? When you're getting stuck and when something isn't working and the money isn't there, it's at the warehouse. It's like a Curb Your Enthusiasm. It's in the banana sand, it's in the warehouse. Right? That is something that I wish I knew and I wish I could tell people. And so focus on if it were me and I were starting, I would probably put the distribution in three PL, honestly, is probably number one, because it's a big moving beast. You need to learn a lot. You need to find somebody that you can trust and if you commit, you should commit with that three PL to a level where you say, when we get the size that we are, we both need to have an agreement that you're going to help me find the next place, right? And if they look at you cross eyed, they're like, no, we're going to grow with you.
Paul Jarrett 00:20:24 - 00:21:55
Like, wave your bullshit flag, right? Because they're just probably not built for it. Now, here is what I have seen. There is something about the magical number of 10,000 a month where customer service, whatever, it really starts to seep in and really become hard. And usually people right around that 10,000 mark, they kind of feel like they're gunning to find a fulfillment company. And if you get to that 14,000 a month in sale, 14,000 units per month in sales, for some reason that is always the breaking point. I don't know why I have nothing other than hundreds and hundreds of conversations, but if I had a bubble word cloud of like, when do people want to just jump off a cliff and regret no matter how much money they're making, all the issues are overwhelming and they're actually starting to lose money and piss off customers. Something about that 14,000 shipments a month is just so hard to pull off with even a lot of people because it's that inflection point of are we going to focus on the brand and the distribution and the whatever, or are we going to get really great at logistics and probably let the brand suffer a little bit? So I would say we'll work with people at zero if we believe in it. Fulfillment companies locally will do that and I think that's okay.
Paul Jarrett 00:21:55 - 00:22:09
Just know when the time is to go. I think the industry is going to say 2500 to 5000, I don't know. But what I do know is 10,000 a month you really start feeling it and 14,000 a month you question your existence.
Blaine Bolus 00:22:41 - 00:23:42
Yeah, that's super interesting because that number, that's when you're at what like somewhere between 300 to 500 orders a day where stuff's coming in and through that you're going to have all sorts of questions because you're going to have X amount of inevitable product breakage in terms of delivery. It's an odds game, right? And then you're going to have customers who are upset for a reason that's totally outside of your control or the communication. So I think it definitely does make sense if you're a small business and you're starting to scale, that's when you're going to start to feel that scale. So why don't you talk to me a little bit about the other side of what goes into the stuff that not only do you guys do, but what a D to C or Ecommerce founder needs to be thinking about when it comes to IPL and fulfillment, right? So there's the physical act of shipping, but you've got packaging somewhere there in the mix. There's like the assembly component, making sure it's out on time.
Blaine Bolus 00:23:42 - 00:23:50
Why don't you just talk me through the other components and the other things that are hard problems to solve for that are part of this supply chain equation.
Paul Jarrett 00:23:50 - 00:24:32
Yeah. And it's probably the entrepreneur in me. I'm trying to shut off whatever is beeping. I have no idea what in this room is beeping. So I tend to be very much start with the end in mind. Right? And this is probably why I argue with a lot of three PL people. I'm actually finally, after twelve years, starting to get in the groups like the old dog groups where they're like, maybe this guy knows something. And I would say that everything that those folks talk about in traditional three pls is just shipping and margins and it's just so futile.
Paul Jarrett 00:24:33 - 00:26:00
It's like you don't really control it. It's ups, you need to be sharp on it. But it's such an obvious dumb thing to focus on. It's like red ocean, right? So I really work with brands to focus on. It sounds cliche, but what problem are you like and for whom? Right? Why are you selling this dog birthday cake? Whatever it is, right? What does it solve for whom? Right? Okay, now work your way backwards. Where is this going to be? If you hit the goal and you are the brand and everybody knows you as like the celebration for dogs brand or whatever, I'm just making this up as I go. Where are those shoppers going to be? Are they going to be in Target? Are you going to have to be in Target maybe faster than you think? Because if you get five stars on Amazon for a couple of years and you get X amount, those big retailers will be so like is the system ready to go if you got to go to Target? Okay, now work your way backwards. How did you get into Target? And we kind of go through a loose exercise and really I think what we find is brands are so focused know, I got this one item and how can I get this into my customers hands as cheap as possible? Because you know what, Paul? I've done the marketing, I've done the fight, I've figured out all this and you're just exhausted by the time it gets to that point.
Paul Jarrett 00:26:00 - 00:27:00
And it's just you think you're going to analyze it, but it ends up being like, dude, let's just do it ourselves, get it out. Like whatever, right? And what I see people do is there's a few levers and a lot of it is software stacks that you're using and are those things going to allow you, for example, Shopify plus I'll give them a shout out because it's about the only company that will do it the way you need it recharge. I know I'm going to get a lot of people to say, but I have no problem saying this. Bulu made recharge with subscription because we were kicking out so many those features we needed. We built our own WMS for big brands. So what I would be thinking about is, what are softwares that I can use? Forget the price. Just try to get that out of your mind. And as I grow and I find out, oh, man, it's not one of these bottles.
Paul Jarrett 00:27:00 - 00:27:50
It's actually a gift set of tasting bottles that are a three month gift to somebody around January because it's a healthy product. Or actually the dog birthday cake we're selling to Veterinarians. How the hell do you deliver to them? Right? So I would be looking at platforms, to be quite honest, like Shopify, BigCommerce. I think those are great. Right? But I would be looking at, am I going to need a loyalty system? Am I going to need points? If I do that, what system is going to allow me to talk to other systems? Right? Okay. If I want to be in Target and they say EDI compliant, what the hell am I going to say back to them? I'm on Shopify because your meeting's over. Right? EDI compliance. Yes.
Paul Jarrett 00:27:50 - 00:28:16
We use blah, blah, blah. Here's boulu's logo. Call them up. Okay, cool. You got to the next step, right? So I would be thinking about solving a problem. Awesome job. You got your product, but probably how you make money, how you think you're going to make money is it actually how you're going to make money? So you need to be flexible on those selections of partners. But more importantly, like softwares that you use.
Paul Jarrett 00:28:17 - 00:29:05
And I got one more rant that you can probably tell. I can go forever. I will fight anybody that will try to counterargue this. What really is logistics to me, when I think about it, is you have a physical representation of your product. There is also a digital representation of your product. The guts of it, the label, all of that stuff should match. I don't care where it comes from, but when it gets to me or my three PL, it better all match up. And I actually don't care where it goes anywhere in the world.
Paul Jarrett 00:29:05 - 00:29:55
Bundled subscription, italy, the local 711, whatever it is, that data better match up all the way through. And in the unfortunate instance, which it will happen a lot, you have to take a return of a gift. You have to take a return of an individual item. You have to take return of a bulk shipment from the veterinarians. How does that data match the system and get back in? Because if you force yourself to think about that following all the way through and back, almost like an infinity loop of your physical and digital, you're kind of dangerous and can do whatever you want. And I guarantee you less than 1% of the logistics world. Thinks about it like that. They're thinking, receiving, putting away.
Paul Jarrett 00:29:55 - 00:30:39
Sure, whatever. We can talk that talk any day. Let's get down to it. What are we trying to do here, actually? Okay, now when you think about that, it will really help you think about the software selections correctly and frankly, the providers that you're using. Because really what that conversation is about is, can you scale in a manner that I don't actually know how we're going to scale yet? And when you look at it that way, it's a damn software problem. You know what I'm saying? That's why I'm sitting here like, we sold the software. My friends like, what are you doing in logistics? I'm like, y'all don't know. Have fun with your bar app or whatever, API, whatever, headless AI, knock yourselves out.
Paul Jarrett 00:30:39 - 00:30:56
When that shit needs to get to where it's got to go, we'll be all right. So it's fun for me because we snipped this out like years and years ago of, oh, we're just going to wait for this, where everybody's tapped everything and they go, well, I guess we got to look at logistics now.
Blaine Bolus 00:30:56 - 00:31:39
Absolutely. My favorite point that you made there is it's not a one size fits all solution. It's more like, you have to understand what's your problem? There are certain products that might sell better in a Target than they would online. Right? I see this a lot in beverage, right? Where everyone's like, oh, I'm starting a beverage. Let me go DTC. It's like, is that really the first place you want to launch, or do you want to use that to complement what your retail strategy is? So I think it's very product dependent and also problem dependent. What's the problem that you're looking to solve? Okay, now we know that problem. Now we can understand the best place to spend your money on inventory and on setting up your supply chain to maximize the profits for it.
Blaine Bolus 00:31:39 - 00:32:31
So given that, let's just for the sake of argument, because you have had a ton of experience with it, let's talk about the supplement space, right? Supplements. Oftentimes they are subscription based because they're good to take. Frequently they are lightweight to ship, and they can be sold both subscription via Direct as well as retail. Right. So if you're just talking about a generic supplements brand, getting that off the ground, what's your kind of dream? Tech stack, almost, if you will, tech operational stack. Because I think what you said makes so much sense because you're like, there's all these considerations and one thing that I'm instantly thinking, it's like if you're launching a brand, you don't want to end up on the wrong stack where the data isn't talking to each other the right way. And you're like, shit, now I need to swap everything out while you've got this flywheel already spinning, right?
Paul Jarrett 00:32:31 - 00:33:24
Yep. It's probably going to look something like shopify recharge stripe in the beginning. And I'm a fanboy of extensive. I don't know if you all talk much about Extensive, but I'm a believer. I am, full disclosure, because I was so into it. I'm part of their software product development team. Not paid, just I wanted to build what they I literally I used to talk to Toby at Shopify in our early days. He did a little bit better than just kind of there's been a few softwares where we're using the piss out of them, and you're asking, I'm the dude that picks up the phone and just calls, or a product development team will call me and go, why are you using this thing this way? That's like, story of my life.
Paul Jarrett 00:33:24 - 00:33:40
And when I saw what Extensive was doing and I saw their kind of first couple of acquisitions and moves, I was like, oh, they're doing the thing. And so I bumped into the CEO at a conference. I was not letting him buy me. I was like, no, you need to stop.
Blaine Bolus 00:33:42 - 00:33:48
Do you want to tell us a little bit more about what it does? So they're kind of like an omnichannel solution, but how does it work? What is it?
Paul Jarrett 00:33:48 - 00:34:28
Yeah, I would say so you have your WMS, your IMS or whatever. Here's the way to think about Extensive. If you connect it correctly, APIs to Shopify, they are a little bit more quietly than I would say, but they are quietly owning all of the distribution channels. So you need TikTok, you need retail, you need bulk. So that's amazing because they acquired, like, fishbowl. I can't think of all of them. Three PL central. Fishbowl.
Paul Jarrett 00:34:28 - 00:35:28
There was three other ones. So we were thinking about three PL central. Then we saw their plans and vision, and we're like, oh, we're in. And so what I would say is extensive. If shopify is what you're using for the user and they see the front end and you see the back end, really what extensive is is that's for the logistics people and you get a portal and you see something, but then it's for all of the backend inventory, et cetera, et cetera. And you can just cleanly connect to, like Walmart. You can cleanly connect to other stuff from a logistics point of view right now, if you're talking the actual product itself, that's product information management, PIM software, that's like a nerdy whole other podcast. So I would say that I'm a big fan of Extensive because not only that, but what they're doing, and it's available now, is they're networking three Pls.
Paul Jarrett 00:35:28 - 00:36:26
So, yes, there's Ship Bob that we did not sign up for on purpose and deliver. And there were all these people that came with Marketplaces because number one, I didn't understand how man, I'm not going to make friends after this podcast. I didn't understand how these MIT and I'm not tossing shade, but I mean, let's call spade a spade here. I didn't get how a software engineer from MIT or whatever is going to have any clue how to make it work for somebody on the floor. And the fact that they were coming after us or whatever it was, and they're like, sign up for the platform. And I'm like my simple thinking was like, sometimes you get bad Uber drivers, but you just report it. If you use that software and you get a bad Three PL, you're screwed. Like they're sitting on your baby.
Paul Jarrett 00:36:28 - 00:36:50
What usually becomes an issue if you don't track the data on the product, it's an inventory problem because you don't know where it's at. You don't know where it's distributed. So that scared us enough to not join the platform with extensive they are thoroughly vetting people. I mean, we get calls when Three Pls are connected, they will guide the call. They will call us. They'll be like, hey, this is Joe. Paul. Joe.
Paul Jarrett 00:36:50 - 00:37:38
Okay, let's talk about how the East Coast can do your bulk fulfillment and then Bolus can do this. And that was what sold me. And all those other places are now scrambling to build their own fulfillment facilities, which is going to be a disaster. Heads up VCs. It's a disaster, but extensive, as committed to they want nothing to do with the fulfillment companies. And as a proof point, through some acquisitions, they had some fulfillment. But they got rid of the Three Pls because they understand the customer is either the Three PL or brands can use it. And that's the beauty is like, as a brand, you could start on their platform and grow and then go like, OOH, actually I need to move this to a Three PL like that.
Paul Jarrett 00:37:38 - 00:38:23
Because we're all using the same platform. Or if you wanted to ship special gifts, special whatever, but you wanted a fulfillment company that was on the extensive WMS network, then you can send them work, right? And that's the beauty of that system. And that's frankly what I wanted to build for a very long time. And they got the right people, the right money, the right everything. So it's gross how much I talk about them, but I'm like, no, this is the thing that is the trigger point. And one last thing on them. There was a recent conference, and it was four Three Pls. And as I talked with them, because I was one of the speakers, it was like this undertone of Three Pls need to start working together.
Paul Jarrett 00:38:24 - 00:39:13
And the fact that they said that because this industry is ruthless and Three Pls will do whatever they can do to take business from another one, and I hate that I'm a rising tide, raises all boats sort of person. And to get on stage and just be like, this is stupid. Why are we working together? We're all dead unless we work together. Because of all the other things popping up. And just to prove it to you, whoever's in the audience now come to Lincoln, Nebraska, I'll teach you e commerce on it and hand shot up. And that was three weeks ago, and we've had two, three Pls come into our facility, and we literally taught them Ecommerce. And they went, how about this? You do the ecommerce, we'll do the bulk shipping. And that just has never happened before.
Paul Jarrett 00:39:13 - 00:39:36
And I'm like, they understand what they have to do, how they have to do it. And we have two or three clients now where they have retail facilities they've converted to extensive. And then we're doing a lot of shipments, but they're actually taking returns back to the store, which is a super clean, easy way to do reverse logistics. So, yeah, I need to shut up about them or get paid.
Blaine Bolus 00:39:37 - 00:40:39
No, I love that. And it's really cool because it sounds like they're a solution that you can kind of get set up on. And like you were saying, when the load gets to too much and you're like, okay, now I need someone to take this entire process off my plate, oversee it and run it, and really juice and scale it up, then it makes a really smooth transition, right? So it makes that onboarding and flow a lot easier, especially as a brand. You may be looking to sell in a bunch of different platforms and markets. You may be looking to go Omnichannel, but you may be like, Well, I'm worried about my brand. I'm trying to create that. And how do I get into retail? How do I manage all my orders that I'm coming in D to C? That's really cool. Why don't you tell me a little bit more about now your process, right, with Bulu? So the brands that you're working with, what is it exactly that you're taking on for them? What responsibilities are you taking on, and what do you make happen for the brand?
Paul Jarrett 00:40:39 - 00:41:41
Yeah, so maybe I'll just take a few recent things that we're doing and that'll be a good example of it. So we recently had a large Pet brand that didn't sell anything, ecommerce, but they have a massive following, massive everything, right? I get a phone call from a person, from a person, from a person. They're like, you and Stephanie, that's my co founder, which people will very quickly see. She is the brains of the operation. She was a children's game designer for Pixar and Leapfrog. And when you have that brain looking at user interface of a warehouse floor, that's the secret, right? But they called us up and they know, hey, we want to monetize this. And they kind of said, here's what we want to do. And we said, yeah, you have bigger problems because your current systems where you sell I'm just going to say memberships is what it is.
Paul Jarrett 00:41:41 - 00:42:20
It's not that, but I want to be respectful of them. The current place where you sell your memberships, here's your app, here's your ecommerce or your membership system. And then here's kind of boots on the floor so none of these systems talk to each other. So before we ever talk, anything selling in the store, ecommerce, et cetera, this is what needs to be fixed. This is the price that we'll do it for. If you don't want to do with us, we have partners that will do it. I think we went back and forth for three months. They started dragging my ass into board meetings, and we literally refused to do it.
Paul Jarrett 00:42:20 - 00:42:53
And actually, it was last night. I got a call pretty late, and the brand said, hey, we just want to apologize. We know we burned all of your time. We went and got two other consultants. Both of them said, you're right, and it's not a focus of ours, and we're not ready to put that sort of money into it. And I was like, cool. And they're like, really? And I was like, yeah, man, I knew it was the kiss of death. If we would have just went and found you products, white labeled them, manufactured them, put them in and sold them I'm just looking at my watch until there's an inventory problem.
Paul Jarrett 00:42:53 - 00:43:56
You're screaming at me. So why would I not want to get that fixed in the beginning? So that's a good example of one brand. Another brand, I would say a lot of, like, actually what we're doing now is if there is a brand that has a flour based good, like pancakes or anything with a lot of flour in it, coffee, anybody that's making coffee, candles, kind of the usual suspects. Vitamins and supplements is huge. Over the years, we've just developed enough relationships where we are literally getting those manufactured. In Nebraska, the trucks are driving over, not like carrier freight or anything, but the trucks from the company. And we have invested in some labeling, et cetera products. And we're talking to these people that have large followings or that already have the product, and we just say, look, long table pancakes on Shark Tank couldn't keep up.
Paul Jarrett 00:43:57 - 00:44:26
We heard through the grapevine. We gave them a ring. We said, look, we think we know what's going on. We already have the pancake place that can manufacture Copack. It and copacking. And if you sell your pancakes two bags, not just one bag, because you can hit this shipping rate. Also, we know you want two day, but hear us out. Three to five day, we can hit 94.8% of the US.
Paul Jarrett 00:44:26 - 00:45:12
In three days. And you save X amount. So without ever even talking to you, we're pretty sure that we can save you about $4, which usually you say, Paul, you're crazy. Go away. Or Luke, you're crazy, or whoever is talking to you. Right? But if you know the background of our company, or if you're just in a place where everything doesn't work, those are the things that we'll fix for people. Right? Also, we will have very traditional everyday somebody has an individual product and I almost just fast forward the conversation and I say, look here's ship, Bob yours deliver. I recommend you really go vet those out here's, the pros and cons.
Paul Jarrett 00:45:13 - 00:45:52
Here's what we do, we will work with you. I would say the biggest way to describe what we do is we're agnostic. We don't care where the packaging comes from, if you need help with it, we'll do it, we'll mark it up 10%. We don't care where the product comes from, if you want us to manage it, we're going to mark it up 10%. Right, but usually once you get from kind of the formula we always say like creation to consumption. If you get your hands on that in our position you're just going to be saving people a little bit of money in all places and that adds up and those are by far like our favorite clients that we work with, right?
Blaine Bolus 00:45:52 - 00:46:20
No, absolutely. Paul, as we wrap up here, are there any other tips that you'd have for because I'm sure you've seen time and time again brands that make big mistakes that you are either able to clean up or fix. Like you've seen this a million different times. I'd love if you're able to shout out some of the biggest mistakes that you see brands making that could save them just like massive amount of headaches.
Paul Jarrett 00:46:20 - 00:47:07
Yeah, I would say the biggest mistake I see is people think they have like I got a guy or woman, whatever, human whatever we say nowadays and they believe it, right? They believe, like, oh, I got a logistics guy, or, oh, I got a packaging person, or whatever. And they don't go get three to seven quotes, right? And they don't understand that maybe their person truly believes they're getting them the cheapest lids for their product, right? But what that person doesn't understand is that there's different machinery out there, right? And somebody might do a better lid faster at a fraction of the price. Do you all talk about import yeti?
Blaine Bolus 00:47:08 - 00:47:10
Yeah, a little bit. You want to tell us about it?
Paul Jarrett 00:47:10 - 00:48:17
Import yeti? If I understand it correctly, I remember following the Reddit threat from day one. I believe what they did was they created automated FOIA requests that send and by law companies have to provide where they get all their stuff. So I really think it's wise to find a similar product to what you're selling go to import yeti. I think you get a few searches for free or whatever, figure out where the stuff is coming from, call up that place and tell them you can say who you are, you can make it up, it doesn't matter. But try to reverse engineer what they're paying per lid, per whatever that is. Probably the number one thing I see is people think they got a lock on something and it's just not the truth and they haven't done their homework. I would say the second thing is that people just look at the obvious things. Number one question I get is, how much do boxes cost with you? The second question, I'm talking ten years.
Paul Jarrett 00:48:17 - 00:49:23
Those dwarf everything else. How much is the box? And then the second one is how much is shipping? And nowadays, that's almost like a signal to me of, like, they're thinking about the wrong things. Now, we will still talk to people, but if we can't get their focus on the things that matter for example, dude, yeah, you love your label. It's fantastic. You are killing yourself trying to get that extra $0.10 unless it is crucial to the brand and the brand essence and that they need to learn to let some of those things go, right? And so I think that people the second biggest mistake is they focus on what's obvious. And I don't care how slick, how smart you are, et cetera, you're going to follow down the same paths that people on my side have seen a million times over, and the sharks are waiting for you, right? And I think the third thing is, it's so simple. Nobody picks up the phone. Nobody shows up.
Paul Jarrett 00:49:23 - 00:50:18
Nobody knocks on a door. We were struggling to find a 25,000 square foot warehouse, and I was irate at our team, and I said, I'm just going to go do it myself. I literally drove around Lincoln and Omaha, and I found a little old man doing concrete. And I get out of my car and I'm like, hey, man, I know you probably don't know, but here's what I'm looking for. And if you're laying the foundation on this thing, you got to know, like, people, right? It turns out it was his building, and I rented it there on the spot, got a sweetheart deal because he was thrilled. And he told me, I mean, you could just see it on his face. Like he's like, we'll have this up in three months, no problem. And I went and I checked on him, even though I said verbally, yes, I did my homework, and it was like a match made.
Paul Jarrett 00:50:18 - 00:51:17
And even when we needed to get out and go to a bigger warehouse, because that relationship had been established and he related to me as an entrepreneur, it's a different game. So if there's one thing that I see people forgetting to do is pick up the phone, go see them. I don't care if it's HubSpot, if it's salesforce, if it's extensive, before you rack your brain for days and weeks and throw money and try Zapier and try all that other stuff, dude, just go to LinkedIn and call somebody on the product team at Extensive and just go like, I'm trying to do this thing. Because the amount of times that somebody goes, well, we can light up that feature for you, but it's not ready. But whatever you're like, oh, yes. Give it to me. And it's like not even a lost art. It's gross to do, but if you can get over your shit and just go hammer the ground, pick up the phone, it's different.