Joe Henderson is the Sr. Director of Technology Alliances at Deposco, an end-to-end WMS and OMS platform. In this chat, Joe goes over his career journey, thoughts on robotics in logistics relative to customer impact, how to expand markets, and the importance of data in eCommerce.

Full transcript below.

Joe Henderson’s journey to Deposco

Steven Edelstein: Here we are. 

Joe Henderson: Here we are. That way we can pick up the conversation we have never, ever gotten the time to finish. 

Steven Edelstein: Exactly. Exactly. So, obviously I’m very happy to be spending some time with you today, Joe. You know, most importantly, what I’d like the audience to get more than anything is a real appreciation for not only your background, but the brand itself in terms of Deposco, you know, the legacy, how it emerged, where it came from, how it’s grown up, but most importantly, where your position is in the market. 

I think most important to any audience is to understand what does that core differentiation look like, and at the end of the day, what does the value looks like? So, you know, obviously, high level, what I’d like to do is just ask you the question: what’s your background? How did you start? How did you get into this business in the first place and how did you end up at Deposco? 

Joe Henderson: Oh, that’s the journey question. That’s the one where we can then spend the next — rest of the entire time going through that. But the short version was dumb, aimless kid coming out of high school, absolutely no aspiration in life — the Marine Corps loves getting those. So, I went and spent six years as a computer technician for them, realized it wasn’t good for me, got out, still had no ambition, and got married. 

So, followed my wife to Cabela’s, got a low-level help desk job and just about got fired. You know one of those first wake-up calls in my career and somebody kind of pipped me and said, “You’re too smart for this. You’re too good for this. Why are you just doing nothing in life?” 

And that’s when I got my first mentor, a wonderful lady named Deb Ringleman in the supply chain. And I worked for her for about five out of eight years that I worked there. And she didn’t let me slack — really got me away from being aimless to internally motivated and went from being helpdesk, way up to a strategic initiatives manager, really working on COT process improvement, really starting to figure out what I loved in life, which was operations work. 

And then, I went to Starbucks and they were like, “Hey, let’s build dry goods warehouses. Let’s look out 10 years and build roasting plants.” And that’s where I got into the programming and the math behind what we were doing. So, you know, going from understanding it intrinsically to, “Oh, how do I understand it academically?” And then you’re like, “Oh, this is how the wires work and this is where you pull the strings.”

And then, I worked for a dairy doing the same thing, but looking at how do you optimize the transformation of raw materials into a good that the market wants? And how do you play with very thin margins on the edges to try to eke out everything you can from the raw materials. And when I got to the end of that, I went “I’m kind of done with enterprise. I’m kind of done with doing the end consumer goods.” 

And so, I hopped into Llamasoft. I went to them and said, “Hey guys, I’ve been working on your software for 10 years. Can I work for your software and so they brought me in to be a SME. So, I worked on a lot of client accounts. They’d bring me in and do ‘stump the chump,’ like, “Hey, here’s somebody who actually knows the day in and day out of making the software sing.” He’s gonna be ….; I’m gonna be the confidence cow. You know, I’m going to come in and go, “Hey, it works because I’ve done it.” 

And then, we ended up at Coupa when we got bought out and Coupa was a whole different platform — understanding procurement, procure-to-pay style accounting practices, and really understanding that enterprise software suite. And when I got to the end of my time there, I worked for a wonderful gentleman there named Kevin Farrell, who really taught me the ins and outs of Alliances and I’m ever thankful for that opportunity. 

And then, about — a couple of my Llamasoft buddies called up and said, “Hey, we went to Deposco. Bob McFarland brought a lot of the band over with him. And that was how I ended [up at] Deposco. And I saw it as kind of this re- — kind of merging of my backgrounds, because I came up in operations. I went to software and it was like, “Oh, I can go work on a WMS now. That’s like coming full circle of merging back into where I started. So, it was wonderful to get back to a very operations-focused software as opposed to forecasting and future and analytics, and it felt like coming home.

Why do so many brands struggle to understand logistics infrastructure?

Steven Edelstein: Amen. Amen. So, it sounds to me like you had not only a — you had a number of great mentors, who kind of molded you and framed some of your opinions, but the subject matter expertise has a lot of relevance, which leads me to my next question, which is — more or less, you’re dealing with brands; you’re dealing with different types of constituents, certainly 3PLs, different types of supply chain companies — why is it so hard and so difficult — and again, I say this somewhat, anecdotal — for the 3PL, for the brand to understand what their supply chain really means to their business, to their transactional business? And most importantly, from a technical perspective — again, [00:05:00] I’m not self-serving the Deposco story; [it’s more about] the general global environment — why is it so difficult for these companies to understand what is truly needed within that infrastructure? 

Joe Henderson: I met a gentleman here named Tom Lee when I joined, and he put another — you and I used this term earlier. He put another wood cutout on the wall —

Steven Edelstein: I love it. 

Joe Henderson: “You can’t work on the business when you’re working in the business.” And I think when you are mired down in day to day – when you’re just trying to get orders out the door, you’re just trying to serve your customers, you really [need to] take a step back and go, “Is this as good as it can be? Is this as streamlined as it can be? Am I doing 10 steps when I should do eight? Am I choosing the right carrier or am I really just going ‘slap and pack,’  ’slap and pack,’ get the business out the door?” 

And one of the things one of my early mentors beat into me, and it has a lot of uses, is “Never assume malice where ignorance will suffice.” And I [00:06:00] think a lot of people don’t know that they’re doing it wrong — or maybe, ‘wrong’ is the wrong word — that they’re doing it inefficiently, that they’re doing it sub-optimally; they’re just doing it. And when they’re in the moment, they’re trying to get this business out the door, they don’t think about “How can I be doing it better?” They’re not thinking, “Can I get another account? Can I do more? Can I get more out my team, or do I have too much team? Do I have enough warehouse or not enough warehouse?” They’re thinking, “I’ve got to get through the next eight hours of my life. Am I able to get through that?” And most people are operating that way. They’re operating day to day; they’re operating week to week. 

Steven Edelstein: Right.

Joe Henderson: But when you think about things in six-month cycles – when you think about it in year cycles, it’s just not possible for most people to really think long-term, because the real Maslow’s hierarchy of needs of our life says: “No, existential subsistence and get the job done. I’m way past planning for — I’m not even too planning for the future and, spiritual realization.”

Steven Edelstein: Right.

Joe Henderson: And so, when you back that [into] the business, you’ve got people that are like, “Is my WMS enough for today? Is my OMS enough for the day? Is my planning system enough today?”

Steven Edelstein: That’s — 

Joe Henderson: It doesn’t matter what system it is. It’s what’s gonna get me through the day. So, a lot of times, it’s like, “How do I either separate the guy who knows everything from the business long enough to say, ‘what would perfect state look like?’ Or it’s trying to find an executive that also is not mired down in their silo within the business, optimizing their part of the business, to step back and either do it themselves or form a fire team and say, “If we could start over, if we could make this from scratch, what would be the ideal way to do that in the next three years, in the next five years?” 

And I think [the] biggest problem we deal with is — call it ‘ecosystem,’ call it ‘systemic,’ the pace of business or the asks of the business, don’t allow for that. And so, that’s where I think the software provider Deposco — any solutions provider has to come in and go, “Whoa, whoa. Step back for a sec” —

Steven Edelstein: Right.

Joe Henderson: “If you do this the right way, what would it look like? And then, how do we help you get between existing to excelling?” 

What key information should companies have to truly understand and optimize their business?

Steven Edelstein: A hundred percent. And I think that you have a very good, interesting segueway, which leads me to the next question, which is: from a data perspective, what type of information should these merchants be looking at relative to the Deposco experience to understand not only their business, but understand how to leverage what you provide both on the order management as well as the warehouse portion of the business to make better decisions? 

Joe Henderson: Short answer? Everything. [overlapping speech] The short answer is everything. 

Steven Edelstein: I’m just trying to get — dig a little deeper to understand. 

Joe Henderson: No, I think it’s a great kickoff, Steven. You know I like to joke because it’s like, the short answer is everything. Make me one with everything, because if you have a background in forecasting, you know there is the direct signal and then, there’s the indirect signal. There’s “how many orders did I ship a today?” But then, you look at it and you go, “but what are you shipping?” Okay, well, I’m shipping warm weather gear. Great. Well, if I plan all of my warm weather gear for July in Miami, I’m probably going out of business. And that’s where [direct] signal versus indirect matters, like, “What is my weather data?” I was doing forecasting for Llamasoft, and one of the things we did was an outdoors company.

Steven Edelstein: Right.

Joe Henderson: And it was — we mapped the start and end times of national parks onto the data, so that you could say, “Not only do I have seasonal data, but if I’m in Texas, I want to know what national parks are open, when is their hours of business, what is their seasonality of business,” and we had to map that onto the forecast because details matter.

So, everything — but then, when we think about the supply chain, it’s direct data: How much is coming in from my marketplace? How much is coming in from my retail? How much is coming in from Amazon? And then, it’s indirect: What are market influences? Is the stock market up? Is the stock market down? 

How is the conversion rate between Canada and the US in conversion — because maybe I send a lot of stuff over the border, or I’m working in Europe and I see a recession starting in specific markets. And so, there’s things that really mess with our forecasting potential, because we can look at it as a year over year seasonality or annual cycle, but then [there are] micro things all over the place that are influencing things. CPI is a great one. You know, consumer confidence — are they gonna shift discretionary spending back to —

Steven Edelstein: The CI, yup. 

Joe Henderson: And so, the answer of ‘everything’ is really relevant here. But when we think about specifically in the supply chain, I always like to go to the fundamentals. What is my demand? What’s my supply? And maybe, getting into some very limited price elasticity modeling if you’re in the CPG and brands to say, “Okay, how much money does my consumer have to spend? How willing do they seem to be to spend it with me?” And then, obviously a little bit of a 360 analysis of “and what does the competitive space around me look like?” because if we neglect our competitors, if we neglect the help of the entire sector, it doesn’t matter. My forecasts are if the floor is falling out from under me. 

The role of partnerships at Deposco

Steven Edelstein: That’s a hundred percent correct. And I’m gonna ask you — I’m going to put this aside just for a quick second. We’re gonna talk about partnerships and how that particular process works within — both within and outside of Deposco. 

But you hit on a good point. And I guess, when we start looking at differentiation, we talk about data — but beyond data, beyond information — but I’m [talking about] cross pollination and, you know, what I like to call ‘inference understanding,’ [or] really getting a below-the-surface understanding of what your business looks like. 

What other points of function does Deposco — again, I call it ‘the Deposco experience,’ — provide, again, to the brand, to the supplier, to the logistics company, to the 3PL, whoever it may be, whoever that constituent is? What are they looking to Deposco to get out of your program, which they believe is going to make a difference in their business? 

Joe Henderson: I think it all comes back to our marketing slogan at the end of the day: “It’s Grow Time.” You’ve seen it change into “GPS for Growth.” Growth has never left that kind of core marketing beat. And what they want to get out of us is what I talked about earlier: ‘moving from existing to excelling.’

Most companies are stuck in the business. They are stuck in the way that they’re doing business, but they realize that they’ve hit either a soft or a hard ceiling on what they can accomplish. 

Steven Edelstein: Right.

Joe Henderson: So, when we’re coming in, they’re looking for us to remove bottlenecks. They’re looking for us to make the process more streamlined – allow them to do more, allow them to get that second facility, allow them to take on more business, especially in the 3PL space.

But when we look at it in the CPG brand space, it’s generally channel, like: what are we opening up for them? “Oh, can I go sell on Amazon? Can I go sell on Etsy? Can I make these things easy?” Because outside of the structural way the channels are managed, there’s that data and information layer that you talked about earlier: “How does that data come into my system? How do I make it work?”

So, outside of what we’re known for – which is that warehouse orchestration, the order orchestration – there’s also some very hard guidelines on – or some guardrails on what we do. And so, we don’t step outside of those, and that’s why we have partnerships; that’s why we have integrations – because we can’t be everything to everybody, and I don’t think the market wants us to be everything to everybody. 

You know, the time of Microsofts and Oracles and SAPs trying to own the entirety of the business under one stack just isn’t sustainable. They – one from a business [standpoint], it doesn’t work in a fast-paced environment anymore. Those are multi-year implementations. And two, the average company that’s coming up and hitting, say, $200, 300 million – when Oracle comes in and drops a $20 million bill on your lap, that’s a growth ender, not a growth enabler. 

So, a lot of people are looking at that composable supply chain: “How do I bring in a collection of solutions?” And Deposco likes to be the center of the universe. We like to say, “Hey, if we come in, we will hook to your TMS; we will hook to your marketplaces; we will hook to your accounting system; we will allow for the data to flow between these systems seamlessly. But we’re not trying to be those systems. We want to make sure that you can go create the supply chain tech stack that you want, and then, be able to go solve the problems or take on the problems that you can’t solve today.” And I think that’s really what’s important [for] SaaS or any company right now.

Engaging the consumer with strategic technology

Joe Henderson: I noticed you asked me about competitors and I always like to say: Everybody fits a niche. Everybody fits some reason to be in the market or we wouldn’t be here. And our history obviously came from eCommerce.

Steven Edelstein: Right.

Joe Henderson: We saw what was coming out of the internet. We saw what was coming out of the Amazon effect and realized a lot of business was lift-and-shifting away from traditional brick-and-mortar. So, we needed to be able to expedite how [parcels are] getting both consumed in the business and then, out the door very quickly.

Steven Edelstein: Right.

Joe Henderson: And so, when you think about traditional WMSs that came before us, it was very “truck in, truck out.” It was: “Bring in a pallet, store the pallet, take the pallet, put it on trucks, send it to Walmart.”

Steven Edelstein: Right.

Joe Henderson: And that’s just not the nature of business. 

Steven Edelstein: Not at all.

Joe Henderson: And coming from a background in cosmetics and direct-to-consumer, you know as much as I [do] that those are nice from a balance book perspective, or from a cost and channel management perspective, but they’re not the basis of most up-and-coming brands anymore. 

So, if you can’t go out and engage the consumer where they are in a cost-effective way in an SLA way, they’re just going to move on to the next spur-of-the-moment TikTok. 

Leveraging partnerships for the customer journey

Steven Edelstein: Love it. Love it. I think you’re spot on – hit the nail on the head – which leads me to believe – so therefore, with that premise in place, if Deposco is the enabler to your partners – again, we’re gonna talk about partnerships as a general rule – therefore, your ecosystem is not only supported by, but is enhanced by the partners that work alongside you to make your differentiation even more distinct and more important to not only your current-state audience – your constituents, your ICPs, your clients – but also everyone, every company, every brand that comes after that. 

So, with that said, as a senior member of your management group within Deposco, talk to me a little about how partnerships play a role in your business.

Joe Henderson: I wanna flip the question and for me, it’s less around where partnerships play a role for the business, because obviously that’s important. For me, it’s where [it plays a] role for the customer,” you know, –

Steven Edelstein: Okay. Fair enough.

Joe Henderson: – because I – everything is the first principle of customer success, of the customer journey. And so, when I always say – and you’ve heard me use this all the time in our relationships – I’m a big fan of “Render under Cesar:” “Render under Caesar, which is Caesar’s. And I see the role of the SaaS provider as making sure that our solution does what it’s supposed to – that we are selling the service we’re supposed to, that we’re selling the experience we’re supposed to, but there [are] those guardrails – there’s that point where you stop and go crudely, “That’s not my job;” less crudely, that’s – “I’m not the best person to get that from.”

And so, I always think about like management consulting, which I know it gets a bad rap, but the reality is there is a need to talk to the process and the people side of the process, people technology stack, and look: Is your management capable of doing this? Is your business or your sectional leaders able to do this? Are you in line with the market? Are you in line with your customers? Are you able to do this structurally? 

For example, we don’t do engineering; we don’t do site selection; we don’t do route planning. There’s a whole interconnected amount of things that go into a supply chain that we’re just simply not going to do as the guys who make the warehouse sing.

Steven Edelstein: Right.

Joe Henderson: And so, I think that partnerships always come in [to] create a better outcome for the customer. Can I bring you somebody in to coach your executive team?Can I bring you somebody in to run your trucks better? Do I just bring in somebody to do data integrations to make sure the data is flowing between systems that we may not have experience with to allow you to have that composable tech stack? I use it often in the business, which is – and I didn’t coin it, but I borrowed it – which is influence economics, which is if we are able to create this trust – not just to us as a trusted advisor, but a cadre of trusted advisors –

Steven Edelstein: Right.

Joe Henderson: – it’s going to influence the customer; it’s going to steer them in the right direction; it’s going to help them be more successful. And that can’t come from Deposco in a vacuum. It comes from creating a team of partners with that end goal being the customer’s ultimate success as the guiding principle. And then, handing the pawn off where it makes sense. We are not going to do the TMS; we’re not going to do the site selection and so, we have to curate an ecosystem of partnerships to say, “Hey, love that you’re trying to do this. Let me go pull the Rolodex out. I’ve got a guy.”

You know, and I always joke with people, and it shows my age because I’m going first say, “I saw a commercial on TV,” and people are going to go, wait, you watched it on tv? I always like Verizon. I always like that comment “I’ve got a network” because that’s really what applies [here] – I’ve got somebody at any point in time that I can parachute into the conversation.

I coach our sales team and I say, “I want to move you from saying “No.” to “No, but.” There’s got to be some way to answer the question for the customer, and partnerships [are] the essential enabler of that.

Steven Edelstein: Interesting. And can we – is it safe to say that your partnership philosophy is more about what I call mutuality – and being able to coexist – and be able to share that not only in terms of function, but also revenue? And I would assume that your partners support the mission of Deposco as much as you support their mission.

Joe Henderson: I mean, let’s be honest – not always. Every firm has got their guiding principle. You’ve got something – everybody’s got something they want to [be] when they grow up, something they want to go in the direction of. Your former coworker, Ninaad, said something that’s rattled around in my brain ever since he said it. He said, “Partner until you can’t.” We understand that there are – because if it wasn’t a partnership, it’d be a marriage. Well, we’re not married. [overlapping speech]

There are going to be moments of mutual benefit of —

Steven Edelstein: Hundred percent. 

Joe Henderson: – we’re working together; we’re not working together; we’re on this project; we’re not on this project, but we are creating friendliness. So, if we do run into each other, it’s good for the customer. Maybe this time it wasn’t good for the customer. And if we’re focusing on the outcomes – we go back to that first principle of customer success, of customer-realized outcomes –

Steven Edelstein: Right.

Joe Henderson: – sometimes we’re going to be moving in the same direction; sometimes we’re not, and if we can’t get out of that – if we make it about us and not about the customer, I think that’s where we run into that friction point. So, to your point around “is it good to have those relationships with the partners?” I have many strong partners where we are always in parallel and lockstep. And I have some where it’s casual friendship, like, “Oh, we see you once a year; [00:21:00] we’re working on this account – and when we do it, we do it with the highest degree of output for that customer. Then, we float away for a year and we aren’t working, maybe because they are targeting another sector [or] they’re raising another part of their business. But the key is that when we do come back together, we’re doing what’s right for the market. 

Material handling automation

Steven Edelstein: Very fair. Very fair. Let me shift gears to, you know, looking at some of the – we call [them] ‘ancillary support areas.’ So, for instance, how does Deposco view the whole emergence of AMRs and robotics and automated function, and how does that play a role, not only within the functional behavior of the Deposco product, platform and service, but how does it add value?

Joe Henderson: I think it’s interesting because we definitely are going down the MHE road. We are definitely going down the MHE – I shouldn’t say that – we’re going down the MHE support road. We want to be able to support it systematically. We want to be able to handle those messages in and out of our system, but we are taking a little bit more of a generic approach.

Steven Edelstein: Okay. 

Joe Henderson: I’m sure you’ve seen it at ProMat; you’ve seen it at MODEX; you’ve seen it as it’s cycled over the last couple years [that] there’s just – everybody has an idea. Everybody’s approaching it in a different way. And when we use the term AMR, when we use the – what is it? The assisted self-moving vehicles, et cetera, et cetera, et cetera, you get all these different flavors, but I don’t think the industry’s really coalesced on “this is the right way to get it done.” I think some of them are approaching that very quickly. I mean, we see the rise of AutoStore and how they have really honed in on ‘this is the model’ and it seems to have really resonated and there’s been a high adoption rate.

Steven Edelstein: Correct. 

Joe Henderson: It’s very similar, but when you look down into, say, the assistive robotics, I’m still going to ProMat and seeing, like, 50 different variants. And so, one of the things we’re having to do from a philosophy standpoint is to not hone in on one, to not only support one guy or —

Steven Edelstein: Outstanding. Outstanding. 

Joe Henderson: – put our money on a single horse because we don’t know who’s going to win, who’s going to be there, and so, we’re letting our customers guide that. They’re coming to us and saying, “We want to bring this technology in.” Can we or can we not support that? “We’re gonna bring this technology in?” Can we or cannot support that? And that’s before you get into stepping back into the history of our profession and looking at more traditional WSS and WCS that are focused on the automation of traditional conveyance and movement systems within the warehouse.

Big, long way to say we want to be able to support the customer where they are. But if we go too specific, too far down a rabbit hole before the market has really picked its winners, I think we’re doing a disservice to our customers, because then, we won’t be able to support them where they want to be.

Steven Edelstein: A hundred percent. A hundred percent. I think it’s a – and it’s an interesting discussion in and of itself, and obviously pretty expansive. At the end of the day, I hope you’ll agree that a lot of it has to do with education and adoption at this point. And it is somewhat early in the game and there is a lot of clutter – I hate to use the word clutter – but there is a lot of uncertainty as to who really has a differentiation – who really, from a, robotics perspective, is providing that level of function that is not only gonna reduce labor rate, but is gonna increase efficiency. 

Joe Henderson: Let’s take a pause on that one. I do want to go a little deeper with you on that one. You said something that kind of resonated there, which was innovation. You know, we like to praise innovation, but let’s not lose the difference between innovation for the customer or innovation for innovation’s sake, because I think what we see is a lot of – call it consumer – you know, CES-style stuff, where it’s like, “Hey, here’s a wild thing that a robot’s doing. Here’s a wild thing that a drone is doing.”

Steven Edelstein: That’s right. 

Joe Henderson: But then when we look at what the actual delivered impact for customers are, either these are very niche use cases, or we haven’t seen the adoption that they were expecting. Or maybe it’s 10 years too early, especially in the robotics space. You know, I – a great example [is] Boston Dynamics. [I] Absolutely love those guys. I love the YouTube videos, but how many warehouses are actually deploying Boston Dynamics, and so – [overlapping speech]

Steven Edelstein: Exactly right. 

Joe Henderson: – this kind of gap between “Wow, cool, sci-fi – resonates with the nerd in me versus “but as an operations manager, how would I actually realistically deploy that in a warehouse that makes my operations better?” And I think the jury’s out. 

Steven Edelstein: That’s exactly right. And we could be dropping names all day long from inVia to RightHand Robotics – obviously to Brightpick and so forth. And they do have their place in the market. But I don’t think unilaterally they’ve found their North Star in terms of how they’re going to operate and most importantly, how they’re going to penetrate the industry.

How to plan for international expansion

Steven Edelstein: Let’s go about a different route for a minute and talk about where [you] see – or how should companies plan – because let’s be clear, the domestic environment is somewhat suspect at this point, and I say ‘suspect’ in a very nice way – only because of all the issues that are going on in supply chain. You know, we could talk about 321 being abandoned or being dissolved; we could talk about obviously the whole looming tariff issue and what’s going on with that – good, bad, or indifferent; as I like to call it, it’s the [chicken little syndrome]. We’re not quite sure whether it’s actually gonna happen, but we’re freaking out understanding what’s going to – [what] that impact is going to make.

With that said, with that long-winded explanation, where do you see – or how should companies plan for international expansion?

Joe Henderson: We’re going to be here for the rest of the call on this one. 

Steven Edelstein: I’m sure –

Joe Henderson: I think it’s important – I said this yesterday to a partner that I was talking to and I said, “The thing we keep forgetting is the supply chains are not short-term planned.” So, when I was at Starbucks doing long-term planning, we were planning on a 10-year horizon, because the fundamental – two things, the fundamentals of the business were that long, and the specialized equipment that we were ordering was on an 18-month timeline, and so I think there’s always this news cycle feeling of “What’s coming out today? What’s that gonna do? What’s that gonna do?” 

Supply chains don’t work that way. You and I both know that if we just move all of the noise and think about a supply chain –

Steven Edelstein: Right.

Joe Henderson: – you’re probably looking at a two-year cycle on the fastest supply chains between ideation, formulation, manufacturing, sourcing, [overlapping speech] showing up in the warehouse, doing my marketing campaign, getting out to the customer. I can’t change things that fast. And so, when I hear all the noise, [I go to these] operations leaders and I’m like, “Just stop listening to it – or know how to discern between what is a knee jerk and what is [an] actual policy change,” because we see it with tariffs right now where it’s up one day, it’s down, one day – it’s on this, it’s on this, it’s on liquor, it’s on aluminum, it’s on energy, and then, the next day it’s gone. And it’s like, great. Ask yourself, “Is this a dust-up or is this a policy change,” before making decisions.

And I think we saw that on – and some of that doesn’t always play out. We saw that with Trump in the first thing, where we’re like, “Wait, we blew up NAFTA?” NAFTA was literally one of those assumptive things when I went through supply chain management in my Master’s and it had been in place for 20 years. 

Steven Edelstein: Right.

Joe Henderson: And then it wasn’t. And then, he put in the USMCA, and now he’s back and he’s already blown that up. So, something we thought we’re like, “Okay, we got NAFTA 2, we’re good.” Oh, it’s already gone. And so, there are some things that you assume are true that are going to go away, but if we don’t focus on the long term, we can’t really run a supply chain. You see this in your profession. 

Steven Edelstein: I understand.

Joe Henderson: If I am worried about – I’m not buying a site for a week; I’m buying a site for probably the next five to 10 years. Some of the fundamental things in the supply chain just have to be done on long-term planning or they can’t be done well. 

So, when people come to us and they’re like, “Eh, I don’t really wanna buy a management system,” and [we’re] like, “Stop listening to the noise. Roll your brain back six months. Were you in pain? Yeah. Great. Has the pain gone down or gotten worse? It’s gotten worse. Great. Assume you’re forecasting your pain. It was true before. It’s true now, and it’s going to be bigger. So, all you’re doing is rolling forward the cost of poor performance. So, if you needed a management system before, you’re gonna need a management system later. And unless you are forecasting that the fundamentals of the business – the core foundations upon which you have built your demand and your supply model are gone, then you need to upgrade your systems. You need to bring in a consultant. You need to go look at your trucking. Those things are going to be true for years and years and years, because if we operate the supply chain on a knee jerk, the fundamentals break down and nothing gets done.

Steven Edelstein: A hundred percent. And I like the approach of looking at things from a proactive – a longer-term vision versus a short-term reactionary type of behavior, which I think is – there’s really, in my opinion, … no place for that in business today because there’s so many variables and there’s so much uncertainty.

Market selection impact on supply chain strategy

Steven Edelstein: And with that said, then, so, you know – interesting – and we – again, global expansion is one thing. How does it affect your supply chain relative to the system that you work with? And I guess the question is, whether it be domestic or international, what would you consider when working with one relative to the Deposco experience versus current state of what they may or may not be working with.

In simple language, how do they bridge that gap between their current operation growing into a much more expansive domestic and international – and need I say international business – and … how do systems play a role in all of that? 

Joe Henderson: I think it’s a complicated question. I really like that one, Steve, because I – the systems are important, but the business is important too.

Steven Edelstein: Right.

Joe Henderson: Actually, the business is all that matters, right? So, we recently started working with a group called Launch Fulfillment, specifically because we can support their UK expansion. 

Steven Edelstein: Okay. 

Joe Henderson: So then, to say we’ve got a team on the ground that we can support, that gave them the confidence to say, “We’re gonna go into the UK and we’re going into the UK with Deposco.”

Steven Edelstein: Right.

Joe Henderson: I [have in mind] some companies that actually purchased here in America for international facilities. We worked with a cosmetics company last year that is running a facility out of Spain. We are actually talking to one ProMat here coming up that has an American office that’s running a Columbia facility and SaaS has really made it a lot easier to say you’re going to take your system with you. You’re really concerned with localization of regulation, localization of policy, and local language support.

Steven Edelstein: Right.

Joe Henderson: But SaaS has allowed us to say, “Can you run AWS? Can you run Azure? Can you run something? Great, you’re good.” Then, there’s no consideration about where – “is my software coming with me?” So, I then would look at how [you] want to run your business, because we see traditional multinationals where it’s more of a hub and spoke network: you’re bringing things in; you’re playing with things like free trade zones. I think we are moving away from that a little bit fundamentally.

I think we’re moving to more of a satellite hub and spoke. So, the UK needs to stand alone. Canada needs to stand alone. The US needs to stand alone from a network perspective.

Steven Edelstein: Right.

Joe Henderson: I don’t think you’re [getting] quite as much…lift and shift of inventory between these systems –

Steven Edelstein: Right.

Joe Henderson: And so, having that order orchestration layer that says business can come from anywhere in the globe; I need to select the right facility that it comes from. But once that order drops into the facility, it needs to be handled there, because you’re not going to pull from your other DC; you’re not going to do that order consolidation outside of the region, outside of the country of interest. 

We see this even in Europe. I think there’s some misconstruing of what the EU actually means from a bloc perspective. And that there actually are mini-blocs within there from a language and cultural perspective on how they operate their supply chains as well.

And so, having the software be able to support that gives these companies the confidence to go do it. But they need to focus on the fundamental way that they want to structure their business to be able to do that, because I think some of the things you answered in the last question – 321, Mexico’s change on textiles, the tariff fighting between the usual players of the tariff fighting –

Steven Edelstein: A hundred percent. 

Joe Henderson: It’s going to say that you’re not going to have this global hub and spoke network. You’re gonna have regional hub and spoke networks that need to support themselves. 

Steven Edelstein: But do you think that those – not to get too deep into this, but do you think those are mostly siloed applications? Or do you think that they are truly integrated relative to the data flow, and most importantly, how they coexist to make sure that there’s some fluidity [00:34:00] to the business as a general rule – certainly the inventory itself, but more importantly, the information that, in my opinion, selfishly, is very critical to how you run your business?

Joe Henderson: No, that’s a great point, Steve. I mean that’s a really great point because I went probably a little too low, because I’m talking about the customer outcome. 

Steven Edelstein: I understand. 

Joe Henderson: But to your point, having these be SaaS, it doesn’t matter. The data lives everywhere. And so, you get that global view of the data, you get that global view of forecasting. And so, when you’re looking at where the customers are, what their buying patterns are, you could just still – maybe this is how North America as a whole is running, even if that’s not how it’s going to play out in the execution layer. 

And that’s one of the fundamentals Deposco was built on… – having the single database, that single, coherent data structure, so that as you wove into forecasting, you’re not really having to think about which system’s the data in. Am I trying to tie together three different areas? Am I trying three different networks together? Am I normalizing that for the customer? How am I gonna do that forecasting? That’s just simplistic. So, the data – to your point: global data, but regionalized execution. 

Steven Edelstein: I love it. I love it. I love it. I love it. Let me just shift gears a bit and –

Joe Henderson: Somebody else wants to say “Hi.”

Steven Edelstein: Oh, look at you. Look at you. Love it. Another country heard from. You’re beautiful, absolutely beautiful. 

Reverse logistics and fraud insights

Steven Edelstein: Let’s talk about reverse logistics for a minute. Okay? Now, whether it be – and you know, the question is always “How does reverse logistics affect fraud? How does reverse logistics, if I  can speak correctly, affect the domestic market in conjunction with the international market?” But simply, what should companies, brands – in this case [and] many cases, supply chain companies – what should they be aware of relative to, again, the general reverse logistics process and how that plays a role in, again, that Deposco experience, whether it be order management or warehouse or whatever function it may be? But how does that affect international buyers and certainly, the whole returns [process]. 

Joe Henderson: I’m going to be – I’ll be honest, I’m gonna riff on this one a little bit because [overlapping speech] this is an area that I probably could use more knowledge in, but I know [from] some of my past life, the concept was more around the length of the supply chain and the financial viability of it.

You know, it – we talk about – let’s start with the fraud part that you brought up.

Steven Edelstein: Please. 

Joe Henderson: The fraud part of it is a little bit twofold. I have to assume that most customers are doing returns for the right reasons – that the fraud is a smaller portion of it. It is a costly portion of it, but that it’s a smaller portion of it.

I was recently talking to Two Boxes and one of their whole platform plays is really addressing the quality control of it, the fraud detection, pattern recognition to try to suss out the bad actors before you’ve spent the money on it and be able to either stop working with them, or at least add some kind of penalty on there for the bad behavior.

But if we just focus on the pure  good intention side of it. There [are] a lot of questions around: does reverse logistics even make sense? You saw Amazon experimenting with this probably about 10 years ago, that you’d hit the return button on something and they’d be like, we don’t care. Here’s your 10 bucks. It’s not even worth pulling it back.

Steven Edelstein: But it’s still happening and it gets a sidebar. It’s still happening with all of the delivery services, whether it be Uber Eats, whether it be DoorDash, whether it be Caviar, whatever it may be – their immediate response is, “Let’s just reimburse the customer and not deal with the situation at hand.”

I guess what I’m asking is from how does that particular – we’ll call ‘attitude’ or ‘performance’ within the whole supply chain buying process – how does that play a role, if any, in the centralized warehouse management process? What does – how does that affect it? And most importantly, how does it allow for more enhancement? 

We talked about data – to the data, to the information, to the customer experience, which is going to then strengthen the functional behavior of a Deposco platform. That’s what I’m asking. 

Joe Henderson: No, that’s fair. And again, I think it comes down to business.You start with the data and that’s where it starts: What is the nature of your returns? You know, how often does it happen? Is there regionality to it? 

Steven Edelstein: Right.

Joe Henderson: You see a lot of mom and pops that are like to bring it back to the warehouse it came from, but is that where it needs to be? Do you have the ability to rework it? Can it go back into saleable inventory? Are you better off at the hub and spoke model where it’s like, I’ve got five primary DCs and I’ve got a returns DC, so everything gets consolidated back; you do the qualification and then, you cross-dock it, back out to where it can actually be used. Or you can run the third party model where you just have somebody who’s a returns processor – you’ve been introduced … to some recommerce people over time [whose] whole mission in life is to take that burden off of the first supply chain and then, act as that reverse supply chain. 

So, I think it really is what makes sense for the business. From a Deposco standpoint, it really is, “What is my saleable inventory? What is my available deposit? How much of that has come back? How much of that’s gonna be return to vendor?”

And being able to process that in a quick, streamlined way, we do rely on partnerships for that. So, while we can handle it from a transactional perspective – bring it back in; don’t bring it back in; what facility it [goes] to – that advanced grading is usually better handled by the partner community. Two Boxes was a great example. Optoro’s a great example. There [are] a lot of these guys out there that have made their whole business case –

Steven Edelstein: Right.

Joe Henderson: – streamlining that corner of the warehouse to make it run as efficiently as possible. And I think it goes back to our talk about a composable supply chain of who the right party for this [is]. But I still think it comes down to fundamentals of: What business are you in? What drives value for you? Sometimes, just outsourcing that is actually the right answer. 

The latest Deposco updates

Steven Edelstein: A hundred percent. Just a few things before we wrap up. What’s new? What’s new at Deposco? We’re coming to a full circle moment. We talked about the company; we talked about you. You know, where do you see things growing in certainly 2025, ’26, ’27? What is your line of sight for the company? You know, not necessarily from a marketing standpoint, but from a business impact perspective? 

Joe Henderson: At the end of the day, everything’s a marketing focus

Steven Edelstein: I know it is.

Joe Henderson: [But] when we look at it from the operations perspective, we talk about the three pillars –

Steven Edelstein: Right.

Joe Henderson: – What are we doing for the guys inside the four walls? How are we getting the orders in and out of the system? And a bit of the forecasting. And so, our big play for ’25 is we’re finally rolling out our first AI product. You probably heard about this a little bit at Manifest. You’re going to hear a lot more about it at ProMat, but we look at it as intelligence delivered directly to the executive suite.

Steven Edelstein: Good. 

Joe Henderson: You probably have been blown up to this point of here’s a fancy cat picture. Here’s the computer talking to itself, and we see AI just being sprinkled on everything. But the reality was, it was – I heard a great quote when this blew up two years ago. It was, “It’s a solution looking for a problem.”

And we weren’t really focusing on what is the user experience going to be; what [they are] getting out of this other than a chat bot –

Steven Edelstein: Right.

Joe Henderson: – and so we took a step back and said, “We’ve got all this data that we’re doing advanced forecasting with. We put a team of data scientists to go deeper. What are insights that actually can be driven by that?” If the forecast is going this way, not just, “Hey, Steve, number [goes] up, number [goes] down. Great.” Who cares? It’s, “Steve, number[goes] up. You should look at your mix of FedEx. You should look at your use of trucking. Have you considered looking at this facility for fraud? 

So, we’re really looking at it as moving along from descriptive to predictive, and finally delivering on the realization of prescriptive, but then going one step further. As we’ve done this, we’re rolling out our first mobile app with the goal being C-Suite. “How do I put that directly in the supply chain officer’s hands? How do I put that in the CEO’s hands so that as fundamental market shifts, fundamental operation shifts happen – 

Steven Edelstein: Right.

Joe Henderson: – they’re immediately informed of, “Hey, you’ve got an opportunity or you’ve got a problem here, but here’s the opportunity. Here’s what we think you should do about it. What do you want to go do about it?” Both to enable more meaningful conversations, but to your point, accelerated business decision-making.

Our CEO said something really great at the front of the year. I love people that give me fortune cookies. They rattle around in my head all day. He said, “We have a lack of good decision-making.” We have tons of data, tons of information, but decision-making is the bottleneck. Our goal is to accelerate that with better information, better intelligence, better suggestions to make better decisions, because better decisions are what the business hangs on.

And so by doing that, we put that directly in their hands as an accessory to Deposco. You’ve got us in there running the warehouse. You got us in there running your order orchestration. We got forecasting. What can we do with that to make you more successful? And that’s where you see us out there talking about the GPS for growth. Because if the systems were the enabler, it’s grow time – our previous motto. This is going to be what turns it into “Go left, drive five miles, turn right” – what you’re expecting from a much more curated data intelligence experience. 

Steven Edelstein: I love it. I think you hit the nail on the head. The more intelligence you have, the more pragmatic you are in making those decisions. And ultimately, your success ratio goes way up because the reality is you’re using information that is going to support the steps that you take in order to be a better company, better function, and better for your customers. And I think ultimately –

Joe Henderson: And the one we didn’t add in there, Steve, was speed. Speed is critical. 

Steven Edelstein: Speed is important. 

Joe Henderson: I worked in – for Llamasoft, one of the first things I did for a company was I handed them a one pager and it said the life cycle of a data science project. And it said 13 weeks and it broke it down, and it wasn’t rocket science. It said one week for discovery, eight weeks of data mining, data cleaning, sifting analysis, two weeks of research project, one week for weed out, and they’re like, “Why do I have to pay for the other 12 weeks?” It’s because you have messy data or you don’t have data, or you don’t have the ability to do it, and we’re building frameworks and we’re building models and we’re doing testing and regression analysis and they’re like, “I only wanna pay for the one week.” And I’m like, “That’s great, but you still have to have the 12 weeks to create the one week.” We are trying to compress the timeline of that 12 weeks to near-real time in the business, so that as fundamental things are changing, as real time data happens, you adjust the model. If the model adjusts enough, it raises an alert. It sends an alert to somebody in the business and says, “Hey, here’s what we’re seeing. Here’s what’s changed. Here’s what we think you should do about it. 

So, when you can start moving those decision points closer to the speed of business, it also means that not only are you providing better intelligence, [but you’re also] doing it within the window of opportunity in which change can actually be enacted instead of it being – “Hey, here’s how to avoid the rock.” instead of the postmortem that says, “You hit the rock anyways, and here’s why.” It’s, “Hey, the rock’s coming. Here’s some ways to avoid it.” 

Steven Edelstein: Amazing. Absolutely amazing. You know, I love the inference and I love the deciphering of the information and most importantly, using it to your advantage, which – let’s be clear – that’s what it’s there for.

This has been amazing and every conversation I have with you, Joe, and I’ve said this for many years, I always learned something. And I appreciate that because in my world, if I can learn one thing each day from somebody that I interact with, my attitude is I’ve had a good day and, so therefore, I thank you because you made my Thursday a wonderful day.

So, you know, we’re looking forward to a lot of growth opportunities, with Deposco, with you, with the growth of not only the marketing, but also just the opportunity to co-exist and most importantly, to help the Deposco be and continue to be a better company to the market. So, we thank you for that. And as always, as we continue this journey, we will certainly be asking lots of questions as we go along the road. 

Joe Henderson: I look forward to having more of these conversations because as I’ve always told you, Steve, some of the best people that I work with, I never get to end the conversation.I always tag it “To be continued” on the end. 

Steven Edelstein: Hundred percent. Dot, dot, dot, my friend. Dot, dot, dot. Have a wonderful day. Please do and I will be close and I’m looking forward to doing more of these as we move forward. 

Joe Henderson: Agreed, Steve.

Steven Edelstein: Very good, sir. Thank you. Thank you, Joe. Appreciate it. Alright, be good. Bye-bye.