Operations should improve over time

We don't sell a product. What Productiv is selling is efficiency. So we have to get to know our customers. Oftentimes they have a unique solution that's not easy to automate. Every movement in the warehouse counts. Every 10 feet that a fork truck is driving, every hand movement on a production line — that all counts, and we have to measure it throughout.

People who don't understand fulfillment have never seen a facility in operation. They think that it's moving boxes from point A to point B — it's probably just someone picking, someone putting a label on and getting it out. When they see it in person, they understand it's much more complex.

So we're a third-party logistics company, a 3PL. Our customers are outsourcing a part of, or their entire, supply chain to us. What's different about us in that 3PL industry? It's a really broad term. We really focus on the value-add services: kitting, contract packaging, direct-to-consumer fulfillment. A lot of 3PLs really specialize in what I would say are the simple parts of the supply chain. What we do is a far more unique, often customized solution, where our customers have products that they send us, but we either need to assemble them, label them, package, inspect. There's a value-add service component that's very labor intensive and often really hard to automate.

D2C is more about giving that wow experience to the customer who is receiving the package. B2B is more about getting it right and meeting that compliance — getting that metric, on time in full, to the retailers for further distribution down the lane.

Before we onboard any customer, we try to understand their products, understand their product profile, understand their pain points. So we try to design a program around their requirement. The moment we onboard them, they feel like they found a partner rather than someone just shipping a package or moving boxes.

We have two distinct initiatives. The first is AI and the software piece, and the second is robotics, which we just call physical AI or embodied AI. On the AI side, we feel like we are at the forefront of what's possible today, and we are actively developing and putting those applications into service. We want our team members to be engineering quality and continuous improvement, and we want the robots to be doing the repetitive work.

We're going out with a lean mindset in order to optimize every process, every touch, every activity — eliminate the seven wastes throughout the warehouse or the factory floor. All the work that we're doing is contributing towards getting the work done, which makes us more efficient, which makes our clients happy, which gives us money to share with the workforce. And then, from a servant leadership standpoint, we can go back and say, "Okay, what's next?"

So we're a third-party logistics company. Since I came in in 2017, we've grown over 400%. In that time we've opened five new warehouses and established a ton of new customer relationships. The thing I think I'm really proud about is we have almost zero customer churn through that.

At the scale that we operate, we continue to grow, and we think that offers our customers more and more opportunity — both physical space in the markets they're in, as well as in markets that we continue to grow into — and we are offering customers East Coast, Midwest, and West Coast solutions. So the scale that we offer, both physically and from an IT standpoint, where we are integrated with all major retail brands — you don't see the combination of all those in our industry and our competitors. So we think that human element is always going to be a part of Productiv, but we're augmenting that with a lot of automation that's going to help us scale and protect our customers' brands and quality.

Transcript from the video's caption track, lightly edited for clarity. Words the captions could not resolve are marked [inaudible].