Daniel Rice and the Data Revolution

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Transcript

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Hello, hello, hello and welcome to another recording of Chain Reaction. Today I've got Mr. Daniel Rice, who is a, a bit of a Renaissance man. Not unlike myself, but he's a Renaissance man in the supply chain industry. He's a volunteer philanthropist. He's deep into technology and supply chain. He's currently. He's vice president over at log net and that's kind of what we're gonna talk about today is technology in the supply chain and logistics space. We were just talking a little bit, Daniel. We both, you know, I'm, We both got experience at the same freight forwarder, so we, we know some of the same people and we definitely, with the freight forwarding experience, we see the same trend. Right. So would love your insight on where we're at and where we're headed into the freight forwarding, man and ocean freight, air freight. What's, what's on the horizon. Yeah, man. Great. Thanks for the inter. Great kind of kickoff there. As we look at the kind of tech international space see a lot of companies that were burnt during the pandemic by providers, whether it be ocean visibility providers tech providers a lot of companies out there talking about things they do, but they don't really do them. And and I think a lot of companies were burnt with that. Just recently came back from T p M and Rilla to large conferences focusing around supply chain. And the consensus was we need to go back to basics. We need to go back to what's important in our supply chain. What's I important in the visibility aspect of it? What are the key milestones? And if the technology that companies are hawking doesn't do it, we need to find alternatives. We need to do it quick. we got beat up during the, during the pandemic, and now everybody's kind of taking a breather and it's all right, let's regroup. Let's rebuild a little bit stronger for the next disaster. We don't know what it's gonna be. We don't know whether it's gonna be war, climate, geopolitical, whatever. Something's gonna happen, and how do we prepare for that? So that's really the kind of precautionary tale that I'm seeing. So you talked about the key, you know, it sounds like what you're saying is that. we got, we got away from some of the key metrics, key KPIs. Is there a core group that most companies kind of wanna center around or is there a core group that industry specific? Yeah. I can give you one example in tech space is api. Everybody talks api, let's, let's do an api. And for non-technical folks, that's a exchange of data back and forth between systems, similar to an e d I, but not as structured. E d i's been around for, don't quote me on this, but at least 400 years, maybe longer. And so there's some pretty good standards in this. I know it's old, but I don't know. It's that old. I don't know if it's 400, but it's, it's been out there a. So when I'm talking to an ocean carrier and they, they're saying they're gonna send a vessel arrival or a vessel departure event, everybody knows what that means. When you start going to these APIs, it could be various codes. One carrier could be looking for a a d code, one carrier could be looking for an R three code, and there's no consistency. There's no standardization. So I, I think that's one area that. as we look to get back to basics, it's just, okay, look, what are the standards? I mean, it's, it's pretty standard to move containers around the globe. You know, you got a origin, they do some activity. You gotta port, you gotta a vessel, you got a destination. But we tend to overcomplicate it sometimes. And, you know, I'm a big fan of forward looking technology, but you know, it's gotta be there. We've. extremely large supply chains, and they can't take more disruption as we try out new technologies. So, so are, are, are we taking steps to simplify these complex supply chains? Because you, you said it right, we're, we've got these very complex supply chains. You know, how, how do we do this, right? How do you eat an elephant? One bite at a time. But what is that first step? Yeah. So your large BCOs are starting to look around and see, you know, where does this make sense? Where can we source from that's a little bit more stable? How can we avoid some of the wow mul, multiple touch points around the globe? I did an analysis one time for a, a. Like 27 handoffs of the cargo. And this was L C L. If you look at it, picking up on a, a truck at origin, going through a container freight station onto a vessel deconsolidation through a transload facility like 27, 28 different times that cargo was handled. It's like how do we eliminate behalf of that? How do we simplify it? So that's what, that's what companies are looking at now. How do we, how do we streamline it, make it better? That is 27 times is more than I would've thought. That's, yeah. That's a lot. That's a number you can quote the 400 per e d i. That might have been off, but 27 I think That's it. yeah, definitely. Yeah, that's accurate. Yeah. So 27 is, is accurate for lcl. I'm gonna start using that, right? Like why are, you know that when you use l c you're subject to about a 50, 27 times that you're touching it. So, absolutely. So you know, we were talking about market trends and. You know, man, up and down. Right. We just saw a massive peak and I know where we're at. Do you have conversations with some of these companies and clients about where we're headed and what's, what's happening right now? What, what do you foresee and what are, what are clients doing now to prepare? Yeah, so specifically in the ocean. Rate world. When you think back a couple years ago, had a pandemic 15,$20,000 per container. If you now look at it, rates are getting pretty close to bottom. I don't know if they've bottomed out, but they're, they're pretty close. And you're, you're looking at 2000, 2,500 rates in, in some lanes. So the carriers are avoiding long-term commit. The BCOs are actively trying to lock in rates for three to five years because they don't wanna go back through this cycle again. So that's what we're seeing. It's just different procurement and sales strategies from each party as they put their individual companies in the best possible position going forward. So as we talk, you know, we're, we're anticipating. Downturn in freight volumes we're anticipating. Some real interesting points came up at this last conference I was at on the number of vessels that the carriers are bringing on. They're bringing on huge amounts of capacity. If we're bringing on more capacity, when volumes are dropping, what's that gonna do to rates? That's just you know, supply and demand. I wasn't the best in economy class. rates are gonna go down. If you got more supply than you do, demand rates drop. So I wanna touch on that because I, in fact, I just reached out to the, the president of a large, kind of a, a part of a vessel built, you know? Mm-hmm. what they do is they do the thrusters. So shout out to you, sir, if you wanna come on. I, I wanna ask about this specific topic, which is vessel capacity. is it because of these new ecology standards? Right. The green initiatives where it's gonna be hydrogen it, where it's you know, the scrubbers that have to be introduced? Mm-hmm. there was a post today on LinkedIn just early this morning from, from Europe. Is that why they're bringing on the capacity? Is for the cleaner fuels. And so they, they almost see that in five years time, they're, they're gonna be held to a higher carbon standard versus the vessels that are in rotation now. So they gotta put these orders in. You know, I don't know that you know the answer. I wanna find out, because that's a great question. And whoever you're referring to, I'd love to, I'd love to hear an answer there. definitely the environmental social governance is playing a part with a lot of companies. Huge, huge, huge decisions being made in the boardroom around these initiatives. So yes, it's playing a part. What, you know, how much of a, a part is it playing? I'm not sure, but yeah. Alternative fuels, you know, what's, what's it gonna look like? we figure out hydrogen, hydrogen fuel cells, what's that gonna look like for the vessels? Cleaner diesel, you know, there's, there's a lot of smart people out there trying to figure out how to make it greener. So yeah, crops to'em make it green. But we've gotta also understand there's gonna be an impact two supply chains if we're not ahead of it. Yes. And, and, and I read one article that actually hydrogen is a. Likely fuel alternative than some of these others? I'm not an engineer. Yeah. So I can't answer that. And I didn't understand a lot of the terminology in it, but which is why I wanna, I look for smart people like you to come on here and answer my questions and, you know, talk about technology and logistics. So I just, to your point about capacity, right? Yeah. Not to go down a rabbit hole, but if you think about hydrogen, water is the most abundant element on earth, I believe. Yep. If I look at the map, there's a lot of blue, a little bit of green, lots of blue. Mm-hmm. and then water is two parts. Hydrogen, one part oxygen. Mm-hmm. So how do we figure out how to get that hydrogen and use it as power? Yeah. I don't know. I think that's the basis, right? Is is yeah, cracking that code and using that resource, that's an abundant resource. So back to technology. Okay. I actually posted this. like where do we see technology taking our industry, specifically supply chain and, and less so procurement logistics. Logistics actually involves a lot of manual processes, breaking down pallets, putting them onto trucks whether it's in the US or it's overseas. loading product into boxes. So there's, there's only, in my opinion, so far that AI or machine learning can go, but I've often joked that my, my job as a sales guy mm-hmm. has a lifespan, has a definitive lifespan and I'm only half joking. there's gonna be a time where somebody can boo boo boo enter what it is they need on a computer screen and Right. What is, what is logic? What is log working on to that's going to advance AI that much? Yeah. So if you think about it you know, you've got the physical flow of goods, you've got the flow of data, and then you've got the flow of currency. Those are really. three parts of the, the supply chain. So we're worried about the information and we've been working on full-blown autonomous forwarding for a number of years. So if I look out into the future, I remember back at my time with, with c h Robinson, I was on the international side, and I would key in all the data. Somebody would email it to me. I would print out the packing list. Type it into the system. Somebody would send me the commercial invoice. I'd do the same thing. We'd send it overseas, and if it was an agent office, they would get the email that I sent'em. They would print it out and they would type it in their system. So if you think around the world just for one shipment, I'm typing it. They're typing it. We're both typing the same exact data into our proprietary systems. So with technology and machine learning, that initial typing, typing goes. The interactions with the ocean carriers, the airlines, the trucking companies, that manual, Hey, I need you to go pick up this container in Savannah by Friday. That goes away. Systems are now talking to each other and they send a signal to the trucking company saying you've got a load ready. Pick it up by Friday. And there's no need for that dispatch call. There's no need for the some of the manual processes that have been in place, histor. So I think that from a technology standpoint, that's where it's going from a physical cargo movement. You look at some of the robotics that they are putting in warehouses now you know, you go into some of these large U P s FedEx sorting facilities, it is 98% automated. People there just to make sure the machines are. Some of Amazon's warehouses. You've got robots running around. It's actually at a conference two weeks ago, a robot trying to dance with me. Just a little sorting robot. We were out there just messing, you know, it's like, wow. Technology's getting awesome. So I, if you look out into the future far up, you can see the autonomous trucks the guys are working on. In gals. You put a container on a truck and it drives across the US without a driver. it gets to its destination and there's a autonomous warehouse that conveyor backs into the truck, unloads each box individually and puts it onto the sorting racks empty container returns back to where it needs to go. And you have no, no human involvement, no. No real interaction. Now somebody's gonna have to open the door, somebody's gonna have to cut the seal. But I'm sure over time, we'll, we'll figure out for. Challenges as well. And your projection on your LinkedIn was five years is conservative, five years. So there was a, a video I put up on LinkedIn. It was our c e o talking at T P M Tech I believe. And he was discussing the technology and how we're advancing it and he said five years. I think that's a very conservative, I think if. You know, for a a large VCO wanted to pilot a couple lanes, we could have'em up and running fully autonomous within two years. But I'm, you know, I'm not changing his prediction. I'm just saying I think he's being pretty conservative. Yeah. Yeah. To your point about the robotics, right, McDonald has a fully automated re. So I was driving back from Augusta, and this was maybe two years ago, and I stopped into a McDonald's, went inside, I think the, you know, kids had to use the restroom, whatever. There was no one there. It was a kiosk. This was two years ago. And we said, okay, chicken nuggets and a coke, and. Then, you know, somebody in the back fixed it and brought it out and I was like, wait a second. They've just completely eliminated that front desk or cashier position. Yeah. So yeah, they're, they're, they're doing it. Yeah. Absolutely. You know, we, we talked about investing before we started. Yeah. So I get a lot of opportunities and, and about a year ago, I, I had a a, an opp an opportunity, kind of a, a slide deck from the company that is, that was manufacturing the robotics for fast food industries. Right. And Oh, cool. And their presentation was, Hey, there's, there is a major fast food industry who was taking this on. And it showed the PowerPoint and, and I remember showing it to my wife like, man, this is, this is where. We are headed, you know, and, and then, and the buy-in was out of my price range. But I, it was really neat to see like that technology is here. And then about a year later, which was, I just saw, it was on the news, what, six months ago, that McDonald's had the fully automated deal and. That's real man. And I wish I had the capital to get in on that. you, you'll get the next one. Unfortunately, you know, but so technology as, I mean, you're, you're very deep into technology. Tell me about Technology Association of Georgia. What is it? What does it do? Yep. So the Tech Association of Georgia Statewide organization based on educating and informing people of technological changes that are coming throughout the state. My understanding, it's the largest of its kind, 20 something thousand members, and there are various societies within tag. Tag is what we call it for short. Last year I was on the Supply Chain Logistics and Manufacturing Society. I'm still actively involved with that. SRA Naqui, if anyone knows her, she's now taken over doing a fantastic job. But what we do is we like to educate and lemme say educate and entertain because we like to have a good time with it as well. Last year we did a huge session at Norfolk Southern's corporate headquarters, the new one here in Atlanta. Wow. Information security partnered with us, so we were talking. Cybersecurity and the threats of global cybersecurity attacks on supply chains. We had a cybersecurity legal expert and she explained the number of documents that we go through. So as an educational arm of tags, specifically folks on the supply chain, we look for fun, interesting topics, maybe not mainstream, but that we can educate. You know, provide information to the members on, so that's what we do at tag. Yeah. Awesome, man. And it's, it's really impressive. I mean, we see the news reports of technology and what is. Interesting in our industry, supply chain logistics is to see how technology is taking root in our lives and in our careers. Right? So mm-hmm. even at the rail. Right? good. Even at the rail. Even at the rail where it is needed to, to, to be sure. And what can you tell us about the hearts of Teal Hearts of Teal? Great organization. Young lady started it about two or three years ago. She lives in our neighborhood, diagnosed with ovarian cancer, started having some stomach cramps and things just weren't settling right. And four or five kids. And she went in and they're like, you've got ovarian cancer. And it's like, what? What is that? So Heart TO is an organization that. Looking to educate and inform people on the symptoms of ovarian cancer prior to diagnosis. This is one of those cancer, obviously, it's not gonna impact you and I impacts females and if you catch it early enough, it is, you have a much higher rate of living through it If it goes too long, undiagnosed, it can be very problematic. So of what I do with Hearts Of Till is, you know, help with the fundraising. They do a huge fun run once a year that's coming up in June this year. Hundreds and hundreds of people, kids, families out there. We just, we just have a good time. And then also we do a program Socket to Cancer where we give out Blue Sox to local sports teams. So I've got some pictures on my. Literally 500 soccer kids out on a soccer field, all playing in till socks for ovarian cancer awareness month. So it's just a, you know, just a little thing I can do to give back and Yeah, it's a great organization. If you know anyone you know that's been impacted by ovarian cancer or you got a mom or a sister, have'em look into it. I mean, it is one of those things that we educate on the front end. That way we don't deal with the problems on the back end. I have a mom, a sister, and two daughters, so it's, there you go. Yeah. It's, it's critical. So I am, yeah, I did not know that. Finding it early on, let me know about the deal in June so that I can push it out through my network. Absolutely, absolutely. And you know, we're in the same groups. We can double up our efforts and cuz I'm guessing it's over there in Georgia where you're at. It is south of Atlanta. Last year we also did a heart to till poker run where we had the motorcycles out and about Pretty strong participation there. And there's some other events that they're planning this year throughout the throughout the year. So yeah. Great organization. I'll send you a link. Yeah, man. Just so you can share it. That would be great. Send me the link and I'll be sure to blast that out there. Daniel, how can everybody get in touch with you? LinkedIn's probably the easiest. I'm out there, Daniel Rice, LinkedIn, just look for the beard, bald. It's good. Look, that's what I'm going for. Save on shampoo and just use it down here. Clean, you know, smart with the time. Yeah. My LinkedIn photo is from 15 years ago. So I, I updated mine recently and I'm my mom she'll call and she's like, Daniel, you gotta get rid of that beard. You look terrible, but whatever. Well, cool man. Hey, I uh, cool man. I've had a good time, so I appreciate your time. And absolutely thanks for being a guest. And as always, everybody, if y'all are interested in any passive income, ma'am multifamily advice.com. We are sponsored by Bridgestone Capital, so hit us up.