Special handling and last-mile delivery services are an important niche for transportation companies.

Despite high unemployment and concerns about the economic future, white glove delivery services are thriving. Americans, faced with high local prices, are turning increasingly to e-commerce, even for the big-ticket items like fine furniture and plasma TVs. Retailers, in turn, are looking for ways to add value. White glove delivery, especially for heavy goods, is an increasingly viable solution.

While final mile delivery service brings the product to a customer’s door, white glove services takes that several steps further. At that level of service, delivery personnel often don booties and white gloves, or put carpet runners in place, unpack the merchandise, situate the merchandise in its destination room, install it, ensure that it is working, and remove the packaging as well as the old merchandise. Even the tape from inside refrigerators is removed.

Today, integrated service is fast becoming the hallmark of white glove delivery services, as retailers have determined that getting merchandise to the door, or even into the right room, isn’t enough to win repeat customers. As Will O’Shea, chief sales and marketing officer for 3PD, elaborates, “Delivery and installation used to be two separate events.”

Today’s white glove delivery combines the two. Some of the integrated service providers, like 3PD in Marietta, Georgia, even offer a complex assembly service, assembling massage chairs or installing dishwashers, for example. That requires trucks to stock a basic tool kit as well as common connectors like valves for waterlines and electrical plugs for dishwashers. 3PD also touches up any furniture damage before delivery and talks owners through the basic operating instructions for large electronics purchases. “We certify (our installers) for appliances,” says O’Shea, and send rookies out with experienced teams to learn the fine points of exceptional customer service.

Pilot Freight Services has developed standard operating procedures for its white glove services. The procedures include a checklist for some of the more complex assemblies. “We do a lot of massage chairs, with their foot rests, arm rests and vibrators,” notes John Kelemen, vice president of special services for Pilot Freight Services in Lima, Pennsylvania. Many procedures, therefore, can be standardized.

E-commerce is one of the key drivers behind today’s white glove delivery service. “People are becoming comfortable purchasing heavy goods-furniture, mattresses and electronics-on the Internet,” O’Shea says. They are buying goods online that, ten years ago, would only have been purchased locally.

Meanwhile, according to Kelemen, because heavy goods must be delivered regardless of where they are purchased, showrooms can maintain a lower inventory and ship directly to the customer without ever handling the merchandise.




 

Communicating is key

To succeed in white glove delivery, “Communications are tremendously important,” O’Shea points out. In fact, sophisticated online scheduling and tracking applications are what most visibly sets them apart from their competition. Communications with the end customer is very important the white glove executives all emphasized.

“Recognize the anxiety consignees (customers) feel when they don’t know the next step,” Robert Masters, senior vice president of Manna Distribution Services, advises. A great delivery company will assuage that anxiety by letting the consignee know the status of their shipment throughout its transit. The best white glove services understand that the delivery is an extension of the sale, and so reflects on the retailer and the brand, Brian Boatman, Manna’s director of business development, explains. Therefore, Manna takes the time to establish very clear expectations for the consignee as early in the relationship as possible.

Ideally, the delivery may be scheduled when the order is placed, or at least when it is in the possession of the delivery company. Manna notifies the purchaser when their order is picked up and provides a tracking number and an easy way to determine exactly where the shipment is in its journey towards their home. “They can schedule delivery online,” Masters says.

For its part, 3PD has a nationwide delivery service that can transport the merchandise from the point it enters 3PD’s system through delivery. The delivery can be scheduled at the point of sale-either a showroom or online-making logistics one seamless transaction, as seen from the customer’s perspective. Other scheduling applications alert the customer once their merchandise is in their system.

Typically, customers may schedule deliveries with a three-hour window. “The night before delivery, customers receive an automated phone call or email confirming delivery within a three hour window,” O’Shea explains. The company uses whichever communications devices the customer prefers-mobile phones, landlines, email, text messages, smart phones, etc. “Then, thirty minutes before the delivery arrives, we notify the customer again,” O’Shea adds.

With online scheduling, consignees also have an opportunity to learn about the delivery company and its services, so they know what to expect at each stage of the delivery. Some services provide only last mile white glove service, and others provide nationwide white glove delivery in which they handle the entire transportation process.

Traditionally, however, it has been easier for customers to track merchandise cross-country than to track it from the local warehouse to their homes or businesses. Nationally, merchandise may be logged in at each transit stop. Once it reached the last warehouse, however, it seemingly entered a black hole. Customers often received a phone call the night before, alerting them that their merchandise would be delivered “sometime tomorrow, depending upon where it’s placed in the truck.”

The reason for that disconnect is simply that last mile delivery services typically are small, local operations with few employees and limited funds. Unlike the retail industry, which is dominated by large, national or regional chains, and the national logistics firms that deliver the merchandise to them, small operations may not even have a Web presence, much less the sophisticated software applications needed for online scheduling and tracking. “That market is very fragmented,” O’Shea stresses.




 

Reducing unnecessary returns

“White glove delivery is not like UPS, which can leave a package at the door,” O’Shea says. That’s one of the reasons behind the scheduling software and the phone calls, emails or text messages. Oftentimes, simply having someone available to receive the merchandise makes the difference between a returned delivery and a completed delivery.

The most efficient white glove companies also know that delivery speed has a significant effect upon return rates. Kelemen suggests that the best way to minimize returns is to get merchandize to the final customer as quickly as possible. Forty years ago, catalog orders arrived two to three weeks after the order was placed, and that was acceptable. Today, the best delivery companies aim for a five to seven day delivery schedule or less, and expect the best online stores to have merchandise ready to ship 24 hours after the order was placed. By doing that, customers can be delighted with their purchase more quickly, and minimize the time in which they may change their minds about the purchase or find a better deal. “The faster you get it into their hands, the lower the chance of return,” Kelemen states.

“There are lots of reasons for returns,” points out Don Ratliff, Ph.D., executive director of the Supply Chain and Logistics Institute at Georgia Institute of Technology. “One is that you didn’t send the right stuff.” There’s nothing a white glove delivery service can do about that.

The other big reason, he says, is damage-either to the shipping carton or to the merchandise itself. “Customers don’t want to see holes in boxes or crushed corners,” Kelemen stresses. 3PD minimizes returns by inspecting the merchandise before it ever reaches the customer. “Damaged boxes are opened and the contents inspected,” O’Shea says.

Pilot and other top companies have standards in place to minimize the chances of damage, Kelemen, says. “If we don’t feel something is packaged well enough, we’ll marry it onto a skid.” Another option is to repackage the merchandise so it can make the transit safely. Transportation companies can also suggest more effective packaging strategies, using new products as well as tried-and-true methods-like adding fill materials, formed foam, and strapping to minimize damage. “The (added protection) may add weight, but the extra costs are well worth it,” Kelemen emphasizes.




 

Adding value

White glove service is nothing new, Dr. Ratliff stresses, whether it was the milkman who in years past routinely delivered fresh dairy products to the door or the soft drink delivery man who stocked a grocer’s shelves as needed and turned each bottle to face the customer. In fact, until the mid-20th century, that level of service was what customers expected. Gradually, as self-service became standard, white glove services of all kinds became the exception rather than the norm.

Now, the emphasis is returning to customer services. “Look for ways to add value to services without it costing significantly more,” Masters advises. Companies that do that successfully, and provide an outstanding customer experience, are likely to thrive.

Within the white glove delivery services segment of the transportation industry, Boatman says those most likely to succeed are companies who view themselves as white glove delivery service provider first, rather than transportation firms that also offer white glove service. For those firms, additional service isn’t ‘additional.’ It’s integral to their mission. As Boatman elaborates, many good delivery firms offer white glove services, but, “The great ones find ways to integrate their white glove operations into their customers’ organizations.” From the end-customer’s perspective, the two organizations are seamless.

For example, Boatman continues, “We don’t (routinely) attend the transportation or logistics trade shows. Instead, we focus on the furniture manufacturer’s association trade shows.” Close attention to that organization gives Manna an edge in understanding the issues that concern that customer base and, therefore, in addressing their challenges.

For that market segment, “Furniture damage in transit is a big issue,” Boatman says. “That is understood by the manufacturers, distributors, and retailers. In fact, the consignee is the only one who is not supposed to know this. Therefore, making repairs at the destination before it is delivered to the consignee is critical to being successful.”

Whatever the industry, “The key for us is listening to our customers,” Kelemen emphasizes. That means talking with them about what they are looking for and then customizing a transportation and white glove delivery plan that meets their needs. Transit time, packaging and specific, innovative programs are all part of the plan.




 

Understanding expenses

Making minor repairs is just one of the factors contributing to the extra expense of providing white glove service. “Last mile delivery is the most expensive part of the supply chain,” Dr. Ratliff says, and white glove delivery service is more expensive, still. Before goods reach the last mile, they are shipped in large quantities, in full trucks from point A to point B, with one driver, often on the open highway. Docks and forklifts are available for speedy loading and unloading. In that type of transit, most of the labor is in the driving. 

Last mile delivery, in contrast, typically involves smaller trucks, lower-speed city driving, multiple stops on changing routes with trucks that are partially empty, and oftentimes two people, Dr. Ratliff explains. Loading docks and forklifts are not available, so trucks must either have hydraulic lifts or be unloaded by hand. Therefore, the labor required for last mile services in terms of cubic foot of space is more expensive than trans-national shipments.

White glove service further slows deliveries because of the time spent with each customer and the extra care each product receives. Most of the labor costs are in the services that white glove delivery services provide, he adds. 

Both Pilot and 3PD are national delivery services that provide door-to-door services using their own fleets. Maintaining their own fleets gives them more control over the service and its quality, Kelemen says.

However, Masters favors a different operating model. “Manna delivers to all zip codes via a network of local delivery agents,” he says. It holds its agents to the same high standards as employees, without the constraints and overhead of employees. Service level agreements ensure performance, Boatman adds. Manna sets clear guidelines and ongoing relationships to give network members the incentive to succeed and the tools to do so. Performance metrics are among those tools. The key to success is to take nothing for granted. “Successes and failures are logged after each delivery,” he notes, thus gathering the metrics to help network members continually improve.

3PD believes in measuring performance, too. According to O’Shea, “We measure each team daily. We call the customer 12 minutes after the delivery and ask about the service, the professionalism of the delivery team and whether they would want that team in their home. We hold them accountable.”




 

White glove for businesses

White glove delivery service isn’t just for residential customers. Pilot Freight Service provides white glove delivery service for its business customers too, delivering extremely heavy machinery, sensitive medical diagnostic equipment, and in-store displays that may require after-hours delivery and setup.

For business applications, white glove delivery service may include special handling, extra manpower and special equipment, or minor setup and technician assistance such as expedited or deferred transportation nationwide, Kelemen says. The same attention to detail applies.

Meanwhile, the appeal of white glove delivery services hasn’t diminished with the recession. Although the fear of a double-dip recession is still a possibility and consumers and businesses alike are continuing to reduce spending, there is a bright spot. Specifically, white glove services provide retailers with a distinct edge to attracting or keeping high-end customers while simultaneously offering transportation companies another way to make themselves more valuable to existing customers and more attractive to potential new business.

In fact, much of the growth in the sector comes from new customers, remarks O’Shea. As the recession has worsened and purchases have shifted from local stores to online retailers, merchants are seeing white glove delivery services as a value-added proposition that helps them retain customers.

“It’s a necessity for furniture providers,” he says. “It helps make more connections with their customers and therefore captures a greater market share.” wt



Contributing writer Gail Dutton specializes in reporting on the intersection of business and technology.