Also long gone are the days when Schwartz would walk from building to building handing out Baron Messenger business cards. Today his marketing efforts are almost completely automated. For example, he can produce the names of those customers who use the company's 911 service for emergency deliveries and then target them with mailers when he's running a special rate for that service. Because he captures not only the names and addresses of his customers but also information about where their packages are going, he now has a database of tens of thousands of potential clients in Miami.
Baron Messenger has left most of its competitors struggling to catch up. According to David Patterson, vice-president of Atlanta-based Datatrac Corp., a leading software developer for the delivery business, the courier industry hadn't considered investing in information technology until FEDEX and UPS heavily automated their services in the 1980s. Eventually customers used to dealing with the giant couriers started to expect services like on-line package tracking and computerized signature verification from the smaller delivery services, too. Even so, adds Patterson, some large regional couriers are still paper-based. Baron Messenger, meanwhile, has long been automating more or less in parallel with the state-of-the-art giants.
That commitment has paid off, not only in better service and reduced costs but also in the ability to jump in and seize unexpected, lucrative new markets. A case in point: critical-parts inventory. Typically, computer parts or copier parts must be in a certain place at a certain time in order for office equipment companies to meet demanding service contracts. IBM and Xerox, for example, have long carried the burden of managing their own critical-parts inventory, which was usually held on-site at field technicians' offices around the country. If an IBM technician was working on a customer's mainframe and suddenly realized that he needed a new part, he had to return to the office and then lug the part back to the work site.
Recently, however, in an effort to squeeze the last drops of inefficiency from their operations, office equipment companies have taken to outsourcing critical-parts inventory to third-party logistic companies like Associated Distribution Logistics and Choice Courier Systems, both headquartered in New York City. The logistic companies enlist small messenger services around the country to hold and manage their customers' inventory on-site at the couriers' locations and to deliver it on time as needed. Baron Messenger was one of many small regional couriers that were suddenly vying to secure plum contracts with third-party logistic firms. But the firms are very picky. According to Marvin Stone, vice-president of Choice Courier Systems, for a small courier to become a distributing agent, it must have a documented record of on-time delivery and a commitment to the sort of technology needed to track and deliver a wide assortment of inventory.
Baron Messenger was one of the few that made the cut in its territory. In 1991, Associated Distribution approved the courier service to manage and distribute critical parts for AT&T. About a year and a half later, Associated Distribution also began using Baron Messenger to distribute parts for Technology Service Solutions (TSS), which provided field service technicians in a then-joint venture between IBM and Eastman Kodak. At that point, Schwartz went out and rented 2,000 square feet of space next to his office. Because Kodak was responsible for inventory management for TSS, Schwartz committed to going on-line with Kodak's headquarters in Rochester, N.Y. To get hooked up, he just dusted off the company's original 286-based computer, attached a 9,600-bps modem to it, and loaded Kodak's proprietary inventory-management software. When TSS field technicians in Miami needed a part, they would call Rochester to verify that Baron Messenger had the part in stock and then call Baron Messenger for a delivery. "We didn't even know what the parts were," says Baron. "We just knew them by their shelf numbers."
Baron Messenger quickly impressed TSS with its fast delivery and reliability. In 1994, when TSS began to limit its relationship with Associated Distribution, TSS's field technicians in the South Florida office lobbied to keep Baron Messenger on to manage the inventory, says Baron. A TSS field technician says that Baron Messenger was crucial to TSS's ability to service its customers in Dade and Broward Counties. In addition, Marvin Stone says that as Choice Courier Systems gears up to expand into Miami, it, too, sees Baron Messenger as a leading candidate for parts distribution.
Needless to say, Baron Messenger Service doesn't have a lock on high-tech delivery. Competitors seem to be sprouting up everywhere, says Schwartz, noting that today's better technology and dropping prices allow just about anyone with a laptop, pager, and car to launch an effective courier operation. Meanwhile, the larger companies are getting better and better at using technology to provide more customized service.
But none of this deters Baron Messenger Service from pushing forward. The company's challenge today: to service the customer even faster. Schwartz is considering linking the phones and the computers electronically so that when a customer calls in for a delivery, the computer will display the customer's file before the operator even picks up the receiver. Schwartz is also looking into creating a Web site for customers who want to place delivery orders on-line. In the works, too, is a plan to replace the company's alphanumeric pagers with two-way wireless signature-verification pads so that drivers will no longer have to call in the name of the person who signs for a delivery. Instead, recipients will sign an electronic pad, and the signature will be transmitted back to the company's system and stored in the customer's file.
With those sorts of efficiencies, even Santa Claus might have trouble keeping up.
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Joshua Macht (josh_macht@incmag.com) is a reporter for Inc. Technology.
