Need a couch or a kayak? This Santa delivers only the biggest items for Xmas

Gordon Branov, CEO of Pilot Freight Services. Pilot, the Delaware Co.-based logistics company, is delivering big for the holidays. The privately-held shipper is running 24/7 to get oversized presents to customers.

A king mattress won’t fit in one of Amazon’s little white vans. And the U.S. Postal Service, UPS, and FedEx won’t ship a hot tub or a couch.

The e-commerce revolution has exploded far beyond books, household goods, and groceries. Though online orders represent only 15 percent of overall retail sales, that share is continuing to mushroom. And so has the sheer bulk and size of the items being ordered.

Millennials do 44 percent of their shopping online, said Zach Zacharia, director of the Center of Supply Chain Research at Lehigh University. “That’s the segment that’s growing. That’s where the action is.”

Pilot Freight Services, a Delaware County-based logistics company, is riding the trend to what its CEO called record profits.

The privately held company specializes in delivering oversize and weighty items, employing hundreds of trucks, and a network of 75 warehouses, which it calls “stations,” across North America and Western Europe.

Now that Americans are accustomed to buying small items online, they’ve graduated to objects verging on the mammoth: Think massage chairs, kayaks, and kid-size SUVs, said Pilot CEO Gordon Branov.

Traditional e-tailers — especially the one with the printed smiley face on its cardboard boxes — process orders through fulfillment centers, and nearly every item they sell and ship has to fit on a conveyor belt.

“Massage chairs, kayaks and hot tubs don’t fit well onto a conveyor belt,” said Branov, who started with Pilot loading trucks and answering phones nearly 20 years ago.

The company was well-situated to exploit the shift in buying patterns. Since 1970, it has rush-shipped industrial items to destinations where they were urgently needed. That equipment has ranged from MRI machines, jet engines and wind turbine blades to replacement pieces for electrical systems blown out by hurricanes.

“They’re not things that can be dropped off on someone’s front step,” said Branov.

So, along with goods from military contractors and manufacturers of infrastructure components, Pilot has picked up clients that include big-box and department stores.

Some of those clients have been driven to online sales out of necessity. Macy’s, JCPenney and Sears have all downsized, while others, like Sports Authority, have gone bankrupt.

“The number of retail stores closing is shocking,” said Lehigh’s Zacharia. “This year it was a record 8,600 brick-and-mortar stores. The previous high was about 6,000 that closed in 2008.”

Pilot’s e-commerce deliveries rose 40 percent from 2015 to 2016 and accounted for $172 million, or 30 percent of revenue. The company employs about 1,000 people worldwide and expects to hit $630 million in gross revenue for 2017, a 9.5 percent jump.

Deliveries must be carefully choreographed. On Wednesday, in Pilot’s call center in Media, dozens of customer service representatives — decked out in  their ugliest Christmas sweaters — murmured calmly to customers to schedule last-minute deliveries.

The company operates call centers in other markets from Amsterdam to Mexico City, the idea being that local operators can expedite local shipments. In aggregate, they handle about 2,000 inquiries a day. But on Dec. 11, the year’s biggest shipping day, the number leaped to about 7,000, said marketing director Amy DePaoli.

Generally, operators needed confirmation that there’ll be someone at an address to receive an oversize package. Others answered calls on the third ring from customers worried about not getting a present in time for Christmas. At the same time, one arranged for a crane, a heavy lift, and a small team of workers to handle a 1,999-pound medical device being shipped from a South Jersey surgery center.

Though e-commerce is still a relatively small part of Pilot’s operation, serving those customers represents “90 percent of the calls,” a spokeswoman said.

The call center is staffed 24/7. “They’ll be here on Christmas Day, too,” said Lisa Coyle, chief administrative officer. “There’s allllways someone here.”

 

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