The Return of Sail Cargo

The Return of Sail Cargo

For centuries, sailing ships offered the fastest, best option for transporting goods and people. The Age of Sail (1571–1862) marked the reign of tall ships, with clipper ships representing the apex of commercial sailing’s progression.

The visually striking clippers had strong lines, V-shaped bows that sliced through water and dozens of sails to capture wind. First developed around 1845 by American shipbuilders looking to give small fishing boats an edge over pursuing pirates, clipper ships evolved to carry modest amounts of cargo at unparalleled speeds. A clipper ship could reach more than 15 knots and cover 300 nautical miles in a day, easily outpacing a steamer ship’s 9 knots.

During the Gold Rush, in 1849 — 20 years before completion of the transcontinental railroad — ships carried 25,000 Americans west. While wealthier passengers could spring for Panama-bound steamers, take the train across Panama, then steam up the West Coast, most forty-niners endured a five- to seven-month journey around Cape Horn via clipper ship. Flying Cloud set a world record for this trip, which stood for more than 100 years, when it arrived in San Francisco after 89 days, 21 hours.

These greyhounds of the sea were the obvious choice for the British Empire’s most prized cargo: tea. Thirst for tea was such that a so-called tea clipper could earn £3,000 from one cargo load — roughly 20 to 25 percent of shipbuilding costs. The first ship of the season to reach London’s docks would win a premium.

The Great Tea Race of 1866 demonstrated the logistics underlying tea mania. Clipper ships lined the docks in Fuzhou. The first ship to clear customs had an early advantage, but favorable winds, stronger tugboats and the luck of the tides made for a competitive 16,000-mile race between five of the day’s fastest clippers, Flying Cloud among them. Ninety-nine days after leaving Fuzhou, Taeping and Ariel docked within 20 minutes of one another and split the premium.

But as 45 million pounds of tea flooded the market, tea prices plummeted, illustrating one of sail’s disadvantages: Ships couldn’t keep a schedule, which meant supply-side volatility.

The Great Tea Race occurred between two dips in the popularity of sailing. When American banks shuttered in the Panic of 1857, trade slowed, as did the demand for sailing ships. Later, in 1869, the Suez Canal opened and gave an advantage to steamer ships, which could complete the Europe- Asia route in 50 days. Overland transport improved, too, with railroad expansion.

By the turn of the 20th century, countries were abandoning sailing ships in favor of steamers, which offered reliability and greater cargo space. With the opening of the Panama Canal and the onset of World War I in 1914, sail’s demise seemed assured. By World War II, sailing ships were restricted to commercial fishing trades. Tall ships seemed destined for nostalgia, until — nearly a century later — the winds shifted once more.

From 2012 to 2017, shipping accounted for 3.1 percent of global CO2 emissions. The International Maritime Organization estimates that shipping emissions will increase by an additional 50 to 250 percent by 2050. As some in the industry look to lower their carbon footprint, there’s renewed interested in wind power.

In recent years, sail cargo projects have sprung up along old trade routes. U.K.-based Grayhound Lugger crosses the English Channel, trading Cornish ale and organic French wine. Dutch-based Tres Hombres crosses the Atlantic with cacao, coffee and rum. Schooner Apollonia plans to launch on the Hudson River by year end, bringing cider, beer and apples downstream to New York City.

In 2019, Sail Cargo Inc. will open a carbon-neutral shipyard in Costa Rica. Through its 3½-year build process for Ceiba (a 45-meter sailing cargo vessel with a chilled hold space and 25-ton cargo capacity, crafted from sustainably harvested wood), Sail Cargo Inc. plans to offer a traditional skills apprenticeship program, where participants can learn shipbuilding, blacksmithing or woodwork — all green jobs.

While sail may have traditional roots, its means have been updated. Today’s sailing ships have biodiesel engines or solar batteries to augment wind power, plus GPS and plotting technologies to plan efficient routes.

Still, challenges remain. Routes aren’t operable year-round, and — as in the past — sticking to a schedule can be difficult. Port infrastructure might be set up for recreational boats with floating docks that make loading tricky or for the giant post-Panamax cruise and cargo ships. What’s more, to realize a profit, sailing ships need premium cargo. Vermont Sail Freight’s founder, Erik Andrus, said only one crop would deliver an ROI of $0.50 to $1.00 per pound of weight: Pot.

Growth potential aside, modern sail freight has neither the capacity nor efficiency to supplant tankers. Instead, cargo shippers will look to wind to lower emissions. Maersk is trialing rotor sails (invented 100 years ago) to add wind power to tanker ships, which will conserve some 1,000 tons of fuel. And Cargill, which charters over 500 vessels, is co-funding SkySails, a kite sail initiative.

Sail freight’s early adopters are largely companies with the desire (and cash) to align their business with their values by using emission-free shipping for organic, hand-crafted products. Other clients value the interactive marketing experience sail cargo offers: Guests can board the ship, sample products and form a powerful brand connection.

Unlike sailing ships of yore — which competed as fiercely as any 21st-century big-business rivals — today’s sailing ships operate as a network, sharing tips and routes. That unusual collaboration highlights the focus on relationships that could cement this trend as a viable shipping option.

Jason Marlow of Schooner Apollonia acknowledges that sail cargo’s client base is limited at present. Yet, he is optimistic. The more people start to identify sail transport as an option, the more they will request it.

“As it starts to scale up and there are more vessels and it’s more connected, then it starts to compete pricewise with other modes” of transportation, Marlow says. In the meantime, the new-old industry breathes life into port towns that may be struggling to redefine their economies.

Watch Ceiba’s building progress through a collection of short films.

Chain Gang: New Tech Links Trucks on Open Road

Chain Gang: New Tech Links Trucks on Open Road

Pelotons are not just for bikers. Truckers are bringing their rigs in line with packs of other trucks to save on fuel costs and increase road safety.

Companies such as Peloton and Daimler Trucks are entering the market with their connected truck platforms, enabling convoys of trucks to travel together in close proximity while sharing software and connectivity.

A compromise between driverless trucks and human drivers, these new systems still include a human driver that steers each rig. But the entire convoy accelerates or brakes based on the movements of the driver in the lead truck. Tesla is also joining the pack with its autonomous, electric trucks.

Convoy software can perform real-time route optimization from the cab and provide truckers with an alternative to spending hours, days and weeks at the wheel, navigating traffic and avoiding collisions.

Route Optimization That Allows for Constant Change

Route Optimization That Allows for Constant Change

When Layla Shaikley began brainstorming with three classmates, it was to fulfill an assignment in a class on entrepreneurship at MIT. The professor had challenged them to devise a technology that could change a billion lives. Focused on developing countries, the foursome looked at how to use data from volatile zones to draw conclusions about crime and personal safety. They decided to target cell phone data and searched for partners outside the U.S.

But when they began asking around, they learned that companies of all sizes had a more pressing problem: navigating day-to-day deliveries. While routing solutions such as Roadnet® — one of the largest — do exist, these technologies planned routes the night before. They couldn’t make real-time adjustments if a snowstorm hit, traffic got snarled, loading docks filled up or the customer didn’t turn up to receive delivery.

Along with potential customers voicing their needs, MIT advisors noted the same challenge existed in the U.S. Using harvested data as a backbone, the team tackled the complex problem of route optimization for the shipping and logistics industry. Here was the answer to their assignment: a technology to offer nimble routing using big data, machine learning and cell phones.

The first thing they discovered was that most traditional delivery routing systems weren’t accounting for the volume of available open-source data that could reveal historical patterns such as traffic and weather. The team created several algorithms that take in passive data, including historical service times or traffic patterns as well as direct feedback from drivers using their prototype — a straightforward mobile app for drivers to follow, paired with a web-based tool for managers to review.

The students searched for companies willing to share data so they could test it. That part was easy.

“We would cold-call companies on LinkedIn and say, ‘MIT and big data,’” says Shaikley with a laugh. Apparently, that combination was enough to pique interest. To better understand drivers’ challenges, Shaikley rode along with them. “I’d hop in these giant trucks and watch them use our app,” she says. “It was like standing in front of a crowd naked. Drivers are sharp and they know what they’re doing.” And they had immediate feedback: Drivers were critical of the abundance of in-app messaging. How could they deal with a ton of pop-ups while on the road?

After two years of fine-tuning their proof of concept, the team made it official, incorporating the business and naming it Wise Systems. After graduation in 2014, they joined an MIT startup accelerator. When they wrapped that, they searched for paying clients.

Through an advisor at the MIT Center for Transportation and Logistics, they were introduced to Anheuser-Busch. They walked the beer giant through their process, explaining that by using data such as traffic, cancellations, late customers and weather, the Wise algorithms adjust drivers’ schedules on the fly. This means “they can make the most efficient decisions possible” about navigation and order of delivery, according to Chazz Sims, Wise Systems CEO and co-founder.

In 2016, Anheuser-Busch agreed to run a pilot using Wise Systems in two locations: Seattle and San Diego. The company still used Roadnet, its existing technology, for its route pre-planning, but it used Wise for day-of routing. Several months later, when Anheuser-Busch reviewed the metrics — driver satisfaction, shorter routes, quicker work time — they were impressed enough to roll the Wise launch out to every single U.S. wholesaler, plus two locations in Canada.

Wise’s success with the beer giant demonstrates the novelty of their solution — real-time route optimization.

“People think this is solved, but it’s not,” says Sims. Case in point: UPS spent billions to create its in-house system, called Orion. Initiated more than a decade ago, the system didn’t launch until 2016, with the help of 500 staffers working on the technology. In contrast, Wise has a staff of 15. While UPS has incredible numbers — handling 15.8 million packages on an average day — imagine how much technology has changed since Orion was initiated. A UPS spokesperson noted that real-time optimization, including real-time navigation and updates after each stop, won’t be fully deployed until 2019.

Wise’s app makes extensive use of third- party tools — including mapping, weather, traffic and navigation — and focuses solely on the algorithms that take in the data and create flexible day-of schedules.

“We pull real-time traffic, we look at history, we make projections of what the rest of the day will be like,” says Sims. Taking into account that specific route’s history, the software determines that if a driver continues with his or her current route, a delay is likely. At this point, the Wise app alerts the driver to a route change, which the driver can accept or reject based on his or her experience with the trip.

Shaikley calls drivers’ collective experience “tribal knowledge.” A driver who hits the same stop week after week knows some customers have good and bad times for deliveries. Maybe the Coke delivery guy will be there at the same time, maybe parking will be terrible, perhaps the customer is out for his daily coffee.

“They [drivers] can add their own knowledge and insight into the app, and we can take in the feedback,” says Sims, noting that future algorithms for a specific route would include those updates. Shaikley emphasizes their goal of being a driver-first solution.

With several new contracts on the horizon, Wise Systems is making progress expanding the business and plans to capture new market segments in 2018. They will have helped the delivery of 10 million packages by the end of this year by homing in on a single part of the puzzle: flexible routing. For a project that started as a grad school lark, Shaikley says they’re chipping away at the original goal of changing a billion lives by focusing on drivers. “Understanding what is in their heads is the most valuable.”

Wise Systems co-founder Layla Shaikley isn’t your run-of-the-mill MIT architecture grad. Yes, she co-created a tech startup that’s improving the way logistics companies optimize deliveries. But she also interned at NASA, co-founded TEDxBaghdad and co-produced a video featuring #mipsterz, aka Muslim hipsters. Creativity and impact are guiding themes for Layla and key pieces of a lesson her own Muslim parents instilled early on. “They had one rule for me growing up: Do whatever you want, just be the best at it.”

Keep up with the latest in logistics entrepreneurship and follow Layla Shaikley on Twitter @laylool.

The Evolution of How We Shop for Food

The Evolution of How We Shop for Food

In 1900, the “eat local” movement wasn’t a movement — it was harsh reality. Just over a century later, advances in technology — from shipping to inventory management — allow us not only to eat Japanese sushi so fresh it’s practically flapping, but also to restock our fridge with delivered groceries we ordered two hours before. How did our food get here?

Located in a gritty section of Manhattan called Hell’s Kitchen is a large grocery store stocked with everyday essentials — but it’s not open to the public. The building is leased by Fresh Direct, the largest online grocer in the northeast; it’s part of a new hybrid of on-demand shopping and is called a “dark store.” Products on the shelf of a dark store are picked and packed by employees and sent off in cars or on bicycles to fulfill same-day deliveries. In today’s grocery store parlance, same-day has ousted Fed-Ex priority overnight as the new gold standard.

For FreshDirect, creating a new sub-brand to serve consumers’ last-minute needs was vital to remaining competitive. The idea was tossed around in 2011, when the team did a market assessment of its conventional model. Online grocery stores offered a wide spectrum of where and when you get your food. But if you needed something the same day — maybe because you hadn’t thought about dinner or you didn’t know where you would be — well, you were high and dry. The resulting concept, named Foodkick, launched first in Brooklyn in November 2015 and then in Manhattan in 2017.

The private company won’t share numbers, but Jason Lepes, vice president of merchandising, says they’ll be expanding to a third location soon.

“The business is going really well,” he says. “Huge.” FreshDirect is not alone. A McKinsey & Company report on the state of parcel delivery notes: “The last mile is seeing disruption from new business models that address customer demand for ever-faster delivery.”

While speedy delivery is what everyone says they want, consumers are mostly interested in the cheapest option. What will bring down the cost of same-day delivery? Scale, automation and robots.

This is a grocery store. But the public isn’t allowed inside — only Foodkick’s personal shoppers, who gather provisions ordered online and send them via bike or car to customers. The so-called dark store enables same-day deliveries in Manhattan. (Click image to enlarge.)

The Roots of Food Shopping

How did we get here? While today’s passionate consumers debate the merits of local versus organic, in the early 1900s everything was local. Markets were small areas where carts, farmers, buyers and sellers gathered together to buy, sell and trade. In cities, if you couldn’t pick it up within a 10-minute walk from your home, it wasn’t in your bag. Markets were open six days a week, and notions like refrigeration were pure space-travel fantasy.

Eventually, these loose outdoor areas moved under roofs and inside buildings to create permanent spaces for vendors, which enabled more reliable sourcing and a greater selection of foods offered. Over time, improvements in transportation and shipping also increased selection.

Before cars overhauled our diet — allowing consumers the ability to drive longer distances to stores and buy more than one could carry home by hand — trains did. First, by moving commodities around the country, increasing selections and lowering prices at markets. And then, by incorporating refrigeration technology.

“The refrigerated rail car made meat affordable for average households by allowing companies to ship carcasses rather than live animals across the country,” writes Marc Levinson in “The Box,” his book about the shipping industry. Once refrigeration became an everyday reality, food products could be shipped farther from their origin. [Learn more about the importance of refrigeration in the food supply chain in our feature story, “Transcending Seasons: Following the Global Cold Chain.”]

But before shipping could become fully globalized, our food cargo had to transition from rails to trucks, a trend that began in the 1940s and firmly took hold in the 1950s.

Once trucking became the de facto interstate transit (complementing trains but surpassing them in goods delivered), leaders in the industry began retrofitting the human side of delivery, tackling shipyards first. Trucking magnate Malcom McLean realized that quicker loading times could improve every stage of logistics. He helped create a streamlined container, leveraging what he knew of trucks and trains. This shipping container became the industry standard and rapidly made delivering goods by boat an affordable idea. In the 1960s, once mechanical cranes transformed how containers were loaded and unloaded, removing traditional dockworkers from the process almost completely, goods from every continent, such as kiwis from New Zealand, Italy or China, could reach the world.

Read our story about early NYC’s network of markets, located so people could access provisions as part of their daily routines.

Global Goods

Each year, 817 million tons of foods are shipped around the world, with distances increasing over the last 50 years to an average of 1,300 miles. More than $50 billion worth of goods is moved every day by cars and trucks, a journey that depends on shipping containers. We need look no farther than our morning cup of coffee for an illustration of those miles.

“By the time you enjoy the beans back in L.A., they had traveled more than 30,000 miles from field to exporter to port to factory to distribution center to store to my house — more than enough to circumnavigate the globe,” writes Edward Humes in “Door to Door.” “Thousands of man-hours and billions of dollars in technology and infrastructure — along with the efforts of countless unsung heroes who pack, lift, load and drive and track it all — combined to bring that cup of coffee to my lips.”

Fast Versus Instant

Ten years ago, the Natural Resources Defense Council reported that a “typical American-prepared meal contains ingredients from at least five countries outside the United States.” What’s in our refrigerator today represents an even bigger diversity, and the last mile these far-flung foods travel is being compressed into a sandwich of instantaneous desire.

While many companies and startups are focusing on speeding up the last mile, only a fraction of consumers are ready for it. In a survey of almost 5,000 people, McKinsey reported that only 23 percent wanted to pay for the same-day option. Despite that, “same-day and instant delivery will likely reach a combined share of 15 percent of the market by 2020,” McKinsey asserts.

Evidence of this burgeoning trend is everywhere: Amazon expanded its same-day delivery service to Prime members in 8,000 cities in early 2018. Around the same time, Target purchased Shipt, which has more than 20,000 personal shoppers, for $550 million. Instacart, which works with almost every major supermarket, has expanded to 69 regions across the U.S. and by the end of 2017 was serving 60 percent of American homes., owned by Walmart Inc., offers its same-day service for free, and soon, Walmart will pilot the same service in New York.

While everyone from big brands to startups attempts to tackle the challenges of same-day food logistics — a problem that involves route optimization, staffing, merchandising, scheduling and supply chain — the concept still relies on old-world delivery methods like trains, trucks and ships. Whoever dramatically changes that network — getting food delivered to our homes in game-changing ways — will also own that well-worn cliché: I reinvented the wheel.

HEB’s Curbside Pickup is only one of many examples of ways we’ve outsourced our shopping to others. Personal shoppers gather the items on your list and package it all together for your quick pickup in designated parking spaces. (Click image to enlarge.)

Will Trucks Ever Vanish? The Future of Transportation

Will Trucks Ever Vanish? The Future of Transportation

While trains, trucks and ships continue the global movement of our food in what is now a decades-old system, the evolution of that last mile to our front door is vaulting forward. Here are a few innovations that might become old hat within the next few years.

Foodie Robots

Don’t be surprised when you begin to notice your sidewalk cluttered with electronics instead of people. DoorDash, an on-demand food delivery service based in San Francisco, is testing out robots as an addition to its food-delivery workforce. [Read more about DoorDash in our story, “Smarter TV Dinners.”] With pilot programs that began in Redwood City in 2017, the self-driving robots deliver goods to customers within a two-mile radius. The futuristic helpers come from Starship Technologies and look like small refrigerators on wheels. The self-guided machines use nine cameras and sound waves to create an imaginary bubble around them, which allows them to go around objects or make a full stop. It’s not all rose-colored glasses, though, as cities like San Francisco attempt to enact restrictions limiting these pesky bots.

Edible Drones

The future of delivery, according to everyone, is drones. But that reality — drones dropping boxes out of the air — is a long way off, despite stunts pulled off by Google and Amazon. However, two designs are delivering food in meaningful ways. Windhorse Aerospace has developed a one-use drone, nicknamed Pouncer, to bring food and other supplies to disaster zones. The device, made of lightweight plywood that can be used for firewood post-delivery, incorporates meals wrapped in thin plastic that could be reused in disaster shelters once the meals are finished. According to founder Nigel Gifford (above), the drone will feed about 100 people for one day. Inedible components, such as the electronics, are being kept to a minimum. One day, Gifford’s crafty engineers could wrap those components in bouillon cubes. Sounds delicious, right?

Another forward-thinking drone test is happening in our national parks. The pilot program is aimed at rescuing prairie dogs. The cute rodents have been hit by a disease that, if left untreated, could spell disaster for their primary predator, the black-footed ferret, an animal on the brink of extinction. This is where the drones come in: They’re dropping peanut-butter pellets — the size of blueberries — laced with vaccine for the sick prairie dogs on the ground. The beauty of the drones in both examples is the distance they can cover and their ability to serve hard-to-reach spots.

Autonomous Pizza

For six weeks in late 2017, Ford partnered with Domino’s to deliver pizzas to randomly selected customers in Ann Arbor, Michigan, via its Ford Fusion Hybrid Autonomous Research Vehicle. Customers who agreed to be a part of the test could track their pizza on the Domino’s delivery app, receiving text messages as the car approached. When it arrived, customers received a text with a unique code to unlock the heating compartment inside the vehicle and retrieve their pizza. Ford’s test cars use lidar, a method for measuring distance to a target using pulsed laser light detected by both radar and camera sensors. While the test did include an engineer behind the wheel, the windows were blacked out so there was no interaction. Despite these depersonalization measures, the team found people wanted to interact with the car, even saying hello to it and waving goodbye. As the second-most-profitable pizza company in the world, behind Pizza Hut, Domino’s is paying close attention to what role self-driving vehicles may play in the future. While Ford won’t begin building its self-driving vehicles until 2021, you can already order a pie from Domino’s simply by tweeting the pizza emoji to your local franchise. [Read more about the self-driving Domino’s vehicles in MIT’s Technology Review.]

Underground Delivery

In the distant future we may see the return of pneumatic tubes making their way back into the world as we know it. Several years ago, Amazon filed for a patent for a dedicated system of underground tunnels that could bring packages closer to home — a system that “may avoid congestion experienced by traditional transportation networks.” Late in 2016, the patent was awarded. Other companies are tinkering with similar ideas: Elon Musk is developing technology to bore tunnels below street level in Los Angeles, and Mole Solutions Ltd, an English company, has tested similar systems with government funding. But there’s another more obvious use for our underground spaces, and that’s for our salad bowl. So far, we’ve got greens growing inside giant warehouses, in shipping containers and on rooftops, and it won’t be long before we see hydroponic cells — microfarms, if you will — cropping up underground. When the lettuce is ready for harvest, it can be delivered quickly to surrounding areas, keeping the carbon footprint as tiny as a microgreen.