Newgistics provides an end-to-end solution for its clients.
By Alan Dorich, Senior Editor at Knighthouse Media
Some companies focus on the experiences customers have before they make purchases, but what happens afterward can be just as important. Newgistics, which was acquired by Pitney Bowes last year, does both.
Based in Austin, Texas, Newgistics provides brands with digital commerce, fulfillment, shipping and return services. “We have an offering that most other companies don’t have,” Director of Operations and Engineering Stephanie Cannon declares.
She explains that Newgistics covers the complete shopping experience for its brands, from the time an end user orders a product to when it lands on their front door. But the company also is thorough when it comes to returns.
End users do not have to wait until the parcel reaches Newgistics’ clients to get their refunds. “When the returns come back into the facility, Newgistics actually opens the box up,” she describes.
After the company confirms that the returned items are in the box, it fulfills the refund so the end user can buy more products from the Newgistics client. “We’re also able to put [the item] back into stock in our facility for reorder or fulfillment later,” Cannon says.
Newgistics also offers its clients information about trends as well as other data. “[We are] helping them understand what they need to grow their business,” she says. “We’re definitely a leader in the industry with a complete, total end-to-end solution.”
Newgistics started operations in 1999 as the creator of the SmartLabel for returns. “After that, they said, ‘If we are going to have Smart return labels and a returns transportation network, let’s do the forward logistics,’” Cannon says, adding that the company also began processing returns.
The company later moved into forward transportation. “They wanted to create an experience that was end-to-end service for their customers,” she says, adding that Newgistics ultimately acquired a fulfillment company that enabled it to store customers’ inventory and perform pick, pack and ship services.
Newgistics has grown even stronger after being acquired by mailing and shipping leader Pitney Bowes, which has many complementary services. Carol Wallace, who manages media relations for Pitney Bowes, notes that these include cross-border e-commerce capabilities.
The company, which works with more than 250 retailers, helps its clients deliver products to 220 countries. Thanks to Pitney Bowes, “Harrods can now sell to people in China and Korea, and Ugg Boots can sell to Americans,” she says.
Building a Flagship
Cannon joined Newgistics in 2016 as its senior manager for its industrial engineering fulfillment services. When the company saw an increase of more than 30 percent in its fulfillment business, “I was promoted to director of operations,” she recalls.
Today, she manages Newgistics’ entire fulfillment operation, which includes locations in Reno, Nev., Commerce, Calif., and Hebron, Ky. But the company plans to open a Midwest hub in Greenwood, Ind., which will span 450,000 square feet.
“It’s quite a big facility,” Cannon says, adding that real estate firm Avison Young helped Newgistics find the location in an area where it could source better labor.
“Avison Young is a company that helps find solutions for customers in commercial real estate.”
The facility, she adds, will be Newgistics’ flagship when it comes to automation. It will feature AutoStore, a cube-based, automated storage system that brings goods to people instead of having associates “walk through aisles,” she says. “The more you can take travel and movements out of the operation, the more efficient you can be.”
AutoStore also will boost inventory security and accuracy for Newgistics’ clients. “We’re going to have a solution that scales with our clients in order to help them grow their business, and we will be able to scale with them,” she says.
The facility also will have automated shipping lines that allow Newgistics to meet the needs of clients that require branded shipments. “We’re not here to ship out [something] that looks like everyone else’s box,” Cannon says. “We’ll want to use the clients’ branded box and promote their brand.”
If the client needs specific stickers placed on the outside or tissue paper placed inside, Newgistics’ lines can meet those needs. “[We offer] very customized and very nimble fulfillment,” she says.
Newgistics is coping with the challenge of finding labor for its facilities, which is critical in order to meet customer expectations. “Every customer wants everything from the click on their computer or phone to their front door in a couple of days,” Cannon admits.
The company’s focus on technology helps it adjust. In addition to automated picking solutions and shipping lines, “We’ve also implemented box erectors,” she says, noting that these machines can push out 2,100 boxes each hour. “If someone was hand-making 2,100, it would take them 10 hours to do so.”
Newgistics also meets customer expectations by keeping its fulfillment in the same location as shipping. “We are 99.5 percent same-day shipping,” he says, adding that this allows Newgistics to avoid using carriers like UPS or FedEx.
“As soon as we’re done picking and packing them, they’re able to process them through the shipping network,” she says. “That is one of the big differentiators that we continue to do to adapt to customers wanting orders in two days.”
Cannon is proud of Newgistics’ culture, which is focused on serving clients. “Everything we do [is with] the customer in mind and allows us to give a really great customer experience,” she says.
Teamwork also is an important focus for the company. “We always grow as a team,” she says. “We build very strong relationships when we keep the customer in mind and we’re always ensuring everything we do is around customer needs.”
Cannon sees a bright future for Newgistics, “We’ll develop products that will be able to hit every single aspect of our customers’ business and provide high quality service,” she says.
Based in Stamford, Conn., Pitney Bowes has a long legacy of innovation. “We like to call ourselves a 98-year-old start-up,” Wallace says, adding that the company will celebrate its 100th anniversary in 2020.
She adds that Pitney Bowes is in the middle of a digital transformation. “We’re migrating from a traditional mailing company to a company that’s more focused in growth markets, especially in data, shipping and commerce,” she says.
“We’re consistently bringing new value to our traditional mailing and shipping customers,” she says, adding that the company has connected more than 1 million to its Commerce Cloud.
“It’s our open platform for developers,” she says, noting that the company has developed 40 products on the platform, including shipping APIs that can be sold to its customers.