Prepare yourself to keep up with Amazon’s Ever-Changing Environment
Amazon is a highly successful company, and if you take the time to understand why you will realize that it is because they learn from their failures. This means that they are constantly trying something new, and new ideas fail just as often as they succeed. You will quickly learn that Amazon is always rolling out new programs and policies that can be taken back at any time – sometimes within a week. This can feel like whiplash to a new DSP owner, and our advice to you is to not be the first volunteer for new programs. Give Amazon time to decide if it works before jumping on board.
Get Ready to Put the Time In
Expect to put in long hours for the first month or two of your operation. The more help you hire before launch, the less stress you will have. However, as the owner, you will still need to pick up any slack – and you should be ready for plenty of that.
Hire More Drivers than What Amazon Recommends
Amazon’s standard for route to driver ratio is 2 drivers for every route. However, you don’t truly know how drivers will perform until they are out there, and before you know it you could be struggling to meet your commitments as you acquire more routes. For this reason, you should aim to hire a minimum of 2.5 drivers for each of your routes and select the best drivers for the work.
Prepare to Not Have your Fleet on Time
Amazon will order your branded vans before your launch date. Their delivery date depends on many variables – none of which are under your control. Therefore, 2 weeks before launch, take the time to completely establish a relationship with a rental company (Hertz, Ryder, U-Haul, etc.) that has plenty of inventory. If your branded vans do not show up on schedule, you will be able to quickly acquire vehicles to get started with while you wait for your fleet.
Terminate Your Bad Drivers
There is a saying in the DSP community:
“It’s worse to have a bad driver than it is to have too few drivers.”
As we said before, the name of the game is growth as fast as possible. But the saying above can be expressed another way:
“It’s better to have 5 profitable routes than 20 routes that lose money”
If you have a bad driver, they cost you money every time they come to work. At least one of the following three statements will be true:
- The driver is too slow, and you end up paying them more than Amazon pays for that route.
- The driver causes damage to a van that costs more to fix than Amazon paid for the route.
- The driver causes you to miss Fantastic or Fantastic Plus on the scorecard, leaving bonuses unearned.
If you are unable to coach the driver ‘up’, then you need to coach them ‘out’. In other words, if they will not correct the bad behavior, it is time to terminate them. Do not wait – they are only costing you money each day.
Build a Team Environment
To be successful you must have the support of your staff and drivers. Always include them and make them feel part of the team. Continuously ask employees for their thoughts on how to run the business. When they give you a good idea that you go forward with implementing give them credit and let them know you appreciate them. In other words, be the boss that is also a team player.
Set the Non-Negotiables Up-Front
All employees are creatures of habit. It is important to teach and encourage good behavior and proper procedure from the start and discourage bad habits through appropriate action before they become etched in stone.
As an example, consider uniform policy. Some stations are very insistent that all drivers appear in full uniform each day while others might completely ignore a pair of sweats. But make no mistake – eventually the station will start enforcing uniform rules, and if you let your drivers slide by now, it will be difficult to get them to change the habit later. Enforce wearing uniforms from the beginning and there won’t be any bad habits to fix.
Non-negotiables Should Include the Following:
- If you don’t show up to stand-up in full uniform, you don’t drive.
- If you show up to standup more than 1 minute late, you don’t drive.
- If you go into overtime today, you are off the schedule your next workday (unless it is beyond the driver’s control, such as Unplanned Delays).
- If you no-show more than twice in 60 days, you are terminated.
- If you call-out the night before more than 3 times in 30 days, you are terminated.
- If you cause significant damage to a van, you are either terminated or off the schedule for a week – depending on your discretion.
- If your FICO score is less than 800 for more than 2 consecutive days, you will be removed form the schedule on your next workday.
- If you are caught not wearing your seatbelt, you are off the schedule for 1 week.
To make these rules enforceable they must appear in the contract the driver signs. Otherwise, the driver will successfully apply for unemployment benefits and you will not be able to fight it.
Nurture Your Relationship with Amazon’s Leadership Team
You are called a Delivery Service Partner for a reason – Amazon wants to establish a partner relationship not a contractor/client relationship. The difference between the two is the amount of flexibility you have with each other. A contract is by nature an adversarial relationship where each party tries to do what is in their own self-interest. A partnership is collaborative, where both parties try to achieve a common goal. Partners are more forgiving and willing to reach beyond what a contract specifies for the common good. This requires good relationships between DSP management and station leaders. Each time you visit the station, go out of your way to speak with at least two people you have not seen in the last week and thank them for working with you.
Establish Relationships with other DSP Owners at Your Station
Getting to know DSP owners before you even launch is crucial to a successful first week. They will help you figure out the online tools and processes that are specific to your station. They can also proactively point out problem areas that are impacting DSPs. Create good relationships with them, and when a new DSP launches at your station, pay it forward by helping the new owners too!
It is easy in the moment to become overwhelmed with how much you do not know and how many hours you need to put in at the beginning. Keep the faith – every DSP owner goes through this, and you will eventually see your life return to an acceptable pace. Trust Amazon. The e-commerce giant knows a thing or two about being successful and they will not let you fail.
Talk to your business coach often and leverage other DSPs for knowledge. Don’t ask DSPs to help you – that is not their job, and they have their own operations to handle. But do not ever be afraid to ask for advice!
Focus on the Big Picture
Your first month will be hectic, but do not measure success by what you don’t achieve right away. Focus on what is important and working toward high-level milestones. You can measure how well you are doing each day by checking off the following items:
- I did not drop any routes today.
- All drivers left the station no later than 10 minutes late today.
- None of my drivers were in an accident today.
- No one put unleaded gas in a diesel van today.
- I have at least 1.7 drivers per route on-staff today.
- My hiring is on-track to meet my route commitments 3 weeks from now.
- My business coach and other DSPs say I am doing fine even if I don’t believe them.
- I got at least 6 hours of sleep last night.
If you cannot check off all of the above items today, don’t lose heart – tomorrow is a new day and strive to get 100% tomorrow.