There’s an underdog story unfolding in U.S. logistics.
You’re probably familiar with the tale of David and Goliath — the young shepherd David, against all odds, triumphs over the much larger, more fearsome Goliath.
In the logistics space, Amazon is Goliath. The e-commerce powerhouse has nearly 1,200 active facilities in the U.S., dwarfing its nearest competitors Walmart and Target.
But this week, Amazon may have met its David.
Quiet Platforms, the logistics arm of American Eagle Outfitters (NYSE: AEO), on Tuesday announced the launch of its nationwide Delivery Network to level the playing field for small and midsize businesses. The platform pools the logistics assets of brands into one shared network, a unique model that encourages collaboration between brands who may have been competitors.
“We’re leveling the playing field by offering high-quality delivery experiences without prohibitively high investments in management and technology infrastructure,” said Shekar Natarajan, head of Quiet Platforms. “Our ecosystem also gives carriers the opportunity to reach a wide range of new customers without lengthy lead times or complexity.”
Natarajan, who also serves as the executive vice president and chief supply chain officer of American Eagle, has used many flashy phrases to describe the Quiet model: “plug-and-play,” “co-opetition,” the “anti-Amazon.” But they all loop back to the platform’s core feature — the ability to share logistics and transportation assets across brands.
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Quiet Platforms was built off the outfitter’s acquisitions of Quiet Logistics and AirTerra. As it stands, the combined network comprises 12 facilities across the U.S. and one in Canada, with the most recent being a fulfillment hub opened in Atlanta last month.
So far, the platform’s newly launched Delivery Network boasts more than 40 carriers at the national, regional and local levels. They include a mix of big names like Pitney Bowes and DHL and emerging players such as Veho and GoFor.
Together, the patchwork of carriers aims to be more efficient than the sum of its parts. A key feature of Quiet’s shared network is its ability to help brands navigate capacity crunches. In key markets, the platform offers “redundancy” — it will overload certain regions with capacity so brands can work around individual carrier constraints or demand spikes.
Unlike other softwares, Quiet Platforms’ technology defers carrier assignments to the edge of the shared network, which the company believes can lead to reductions in delivery speed and cost. Specifically, Quiet said brands can deliver one to two days faster and save up to $1 per parcel.
The network even manages performance down to the individual shipment level. For each shipment, the platform tells brands where and how to deliver based on delivery commitment, quality of service and delivery cost.
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“Quiet Platforms is reinventing traditional approaches to fulfillment and delivery through innovations in technology,” said Charles Griffith, chief technology officer of Quiet Platforms. “Providing the ability to dynamically adjust fulfillment and delivery decisions in real time based on an ever-changing set of constraints is something others have contemplated but never achieved.”
Griffith, Natarajan and Quiet have high expectations for their shared network. According to American Eagle’s projections, brands could take 90,000 trucks off the road, save 9 trillion parcel miles, lower logistics costs by $40 billion and reduce carbon footprint by 30% — if they agree to share their assets.
Right now, it’s Goliath’s world. But if enough brands jump on board with Quiet, it could be David’s turn to triumph. So far, more than 60 have.
“Something magical happened when I came to the United States,” Natarajan said. “I was able to work for Walmart, Target, Pepsi and Coca-Cola, which were these amazing companies. I could never have done that in India, so it leveled the playing field for me. I wanted to do the same thing for businesses that have to compete with the Goliaths.”
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