Lockdown Economy Lebanon in an Online Delivery Service with Richard El Cheikh
The interview was transcribed and adapted into an article by Ryan Mitchell
Lockdown Economy is an international non-profit social-economic and educational initiative started by Think Tank AlterContacts in June 2020. The objective is to help small businesses and self-employed professionals to document and overcome the unique challenges of the COVID-19 pandemic and to inspire, motivate and encourage other entrepreneurs around the world. The initiative has been registered by the United Nations as an Acceleration Action for the Sustainable Development Goals.
In this interview, we meet Richard El Cheikh, the co-founder of Shuttles, an online delivery service in Lebanon. During the pandemic, he noticed a great shift to online shopping which is a big change for a traditionally operating country. He decided that he would be the person providing the “shovels and carts” for the “goldmine rush”. In October 2020, amidst the chaos of the COVID-19 outbreak, economic crisis, and other challenges in Lebanon, he co-founded Shuttles, the online delivery services to ensure safety, speed, and reliability for both the customers and their own staff. He spoke about the importance of having help, support from the community, friends, and other people for a family business to succeed and to weather the challenges and complexities that were magnified during the pandemic. At the moment, he does not plan to diversify to other sectors. What is working for him is identifying problems at an early stage, staying consistent, minimizing risks, and understanding the business limitations. Richard is working closely with his team on improving the operations, optimizing routing, and maintaining a healthy relationship with his clients across multiple locations to resolve their concerns and issue pass.
Tell me, what do you do as a business and what is Shuttles?
Richard: We are a small family business built around the last mile delivery. We help other businesses reach their customers and deliver their product. We pick up the orders, store them and then deliver to their customers which helps during the lockdown, especially when everyone is at home to receive their products safely. We do our best to deliver all our orders as swiftly as possible. We have been in the market since the 1st of October so we are about 5 months in operation. My dad and I decided to start this business on a crazy weekend, we said, “let’s just go for it, let’s do it”.
Where is Shuttles based?
Richard: So right now our main focus is in Beirut because it is the hub of Lebanon, you can reach everywhere in the country from here and this is very important logistically. It helps us to move around the country with ease so this is how we have been operating. When we started we were operating from our home; storing everything at home and then delivering orders to the customers, and it was quite a crazy experience to turn our home into a small warehouse but it was a necessary step to do at the very beginning.
So your home was one of the assets for the business?
Richard: The home and the cars yes. Here in Lebanon, public transportation is not very advanced, it is necessary to have a car. Being in a lockdown and having a car, we decided to put it to use; it started with just me and my father delivering the orders. Then we started growing and we got drivers on board and marketing people to help us as well.
How big is the Shuttles team now and when did you start hiring other people?
Richard: So when my father and I started receiving the orders and delivering them, I was basically working on the customer relations, the marketing, the sales and getting the locations of the customers in order, everything logistics-related. My father was the one delivering the orders, and we had a cap because the number of orders that you can deliver depends on the number of hours in a day, so once we reached that cap we realized that it was time to bring someone in to help us. We quickly grew, at one point we had three full-time drivers, but then we had a change of staff. Now we are stable at one full-time driver and two part-time drivers. We really consider them as part of the family, we take care of them as part of the family and this is why we still consider ourselves a family business, especially as it’s still run and operated by my father and me. It is very difficult to grow a delivery company when it’s just the family, you have to bring others in, drivers and other help, in order to succeed.
How many clients did you have right when you started and compared to now?
Richard: When we first began I started talking to the shops that I usually follow or my friends recommended on Instagram. I started messaging them and I sent out about 350–400 messages; 15 answered so there were 15 prospects. Five of them ended up working with us, which is insane because I didn’t have a business page, no online presence or website, I just explained to them we were starting this and how about you give us a try. Some people are adventurous and kind enough to give you a chance and it has been really good. I want to salute the first five or six merchants that started working with us because they really helped the business stand up on its feet. After that we had a huge, unexpected spike in orders, some businesses grew very quickly that were working with us, and some new customers started working with us as well. At one point we had an overflow of orders that we were not able to deliver. This was when family members and friends, cousins and uncles, were kind enough to step in and help us take orders and deliver them. When that happened I really felt as though the business was not going to survive; we were starting to have growth we couldn’t handle, and many businesses die because of this issue. So I said this is not gonna happen to me and I went ahead and asked for help, which is very important. I received the help that I needed and we were able to stabilize the situation and get the drivers that we needed on board after the family helped us get through this tough time. It’s not the worst problem to have but it’s still a problem.
How did the lockdown affect your business which was still in the initial phases as a startup early into the lockdowns?
Richard: The lockdown has been very challenging, it would be unwise of me to say otherwise. The first lockdown was a lighter one, people could still move around and work. Of course, some drivers decided that they don’t want to work in the lockdown because the lockdown is there for a reason, there is a health crisis in the country and you have to understand that your employees are afraid for their health and this is something that we have to take into consideration. Yes, it hurt our operation, but the thing is that the lockdowns affect everyone and they understood operations were going to be a little slower, the orders were going to take a little bit more time. We managed because the community in Lebanon is very supportive. We do have our difficulties whether it is politically, economically, in the health sector as well, but around us, the people understand that nothing can be perfect and we have to understand that sometimes there are difficulties that are outside our control. As a small business, it’s very important to maintain relations with our customers, to let them know what’s going on, and having that transparency in order to be able to communicate on another level.
Can you tell me another example where you were agile and provided a solution to these new challenges?
Richard: Yes, and to mention just a little bit more about the communication, not just in the business level but professionally, having crystal clear communication with the customer has definitely been the driver for us in order to solve any problem that we have. In the field of logistics, mistakes happen and not just from our side, from the side of the merchant, and also from the side of the customer. So it’s very high risk and very volatile market where we have to adapt very quickly to any situation that comes. This is where the second layer comes into play. Optimizing the routing, optimizing the drivers, the management of time is very important, along with the communication, but also being able to solve problems on the spot and move on to help customers and merchants achieve their service or their deliveries. Adapting quickly and being able to move on from a problem and proceed to the next step, not having a hard time getting over any scenario that we’re facing, it is about being really flexible and agile.
How have you tried to attract new clients and stimulate business operations?
Richard: When we started working we really focused on the smaller businesses. We started at about 60–70 orders a week which is nothing when you compare it to the norm. Once that happened and once the quality of our services really stepped up and helped us with our brand image and our reputation, small business brands started talking to us. We are still not able to tap into the market of big businesses that do for instance 500–600 orders a day, we’re still helping small businesses, but we’re definitely looking for bigger fish in the sea. For sure that’s every business’s dream, especially if you’re a service provider. There are challenges to bringing in bigger customers and having a bigger and better portfolio, but these challenges can be overcome by starting with the small businesses; like rolling a snowball it will grow with time, and at one point it will reach a level enough for us to handle bigger clients and have better operations. As a small business definitely our operation is not optimized, we are well aware of it, and we do our best to optimize it. We don’t have a fleet of 100 or 200 drivers who are ready to work with us, we’re a small fleet and therefore the process or the logistics cannot be optimized. We cannot do for instance same day deliveries.
Every day I have a lot of phone calls for food delivery from food businesses wanting to work with us and I just tell them that we cannot do that right now, we don’t have the operation for it and even if I want to do it it would not be wise financially for us at the moment. At one point I will be able to do it, and once that’s done we will definitely give them a call. What is helping us not make any major mistakes is knowing our limitations as a small business, and not being afraid to step outside the comfort zone. Once I had a phone call from a bigger merchant and I accepted the job, I hired more people for it, including two additional drivers and we were able to handle it. They’re very happy with us of course and they have requests to enhance the quality, to make it faster etc., and we always work on it. It’s about having a vision that is clear about what we want to do and at Shuttles we are very, very customer-oriented. We do our best to maximize the quality that we can provide.
How are your customers doing now in the lockdown, and there is any competition picking up?
Richard: Some of our clients were really able to bloom during this lockdown, especially on the online side. A lot of our customers were only brick and mortar shops or somewhere where you go in person. Some were able to transfer this activity to an online product that they can sell, other businesses not so much, and I have had many discussions with many of our customers about how to enhance their products and how to sell more, how to be able to reach more people, and this is something that is very important for me. I will give you sides on this: if I want to be selfish, this is good for me because they will bring me more business, but really my intention out of it is doing good. It’s good karma; if they succeed, good for them, if they succeed and decide to go to a different delivery service, no problem. I just want to see people around me doing good, as it’s not only going to be good for them but it’ll be good for the economy as a whole. Our economy right now is really suffering, and having people around you that are succeeding is the ray of hope that maybe someone needs in order to start their own thing, or take the leap to a project that they want. What matters a lot to me is their success and this is why we prioritize the quality of the service. If we are able to deliver the orders in a quick way, the customers of our merchants will be happy and they will tend to purchase again, it will give them a higher success rate.
What’s going on now with Shuttles and what are you planning for the coming few months?
Richard: We have a lot of very exciting plans, we have just integrated a new platform in order for us to optimize the operation and in order for us to enhance our quality. We used to do everything on Excel and on Word which was absolutely insane to keep track of everything, but we managed. In order to take things to the next level, we really need to have a computerized system that can help with the heavy lifting for us. Now in Europe and other places, there are access points, where if you’re not available they will leave the order at this access point; this is something that we have our eyes on, we want to be able to help our customers get their order regardless of whether they are home or not. This will have its difficulties, especially since most of the businesses here in Lebanon work with cash on delivery, so there is no credit card integration, basically, everything is cash on delivery. I have ideas in my head to go around this problem, but it is definitely the most exciting project that we have right now in Shuttles, however, I don’t see it coming to life before maybe this August or September, maybe this is when we’ll be able to start working on it. This is where we are going right now, this is the path that we are taking because it will enhance the quality of our service even more, and it will make our customers even happier. We’re currently developing our website to gain more visibility online, and once that’s done hopefully we can bring a writer on the team to work on blog posts. We work on our Linkedin posts and I am very focused on the online presence of our brand, this is something that I am willing to invest quite heavily in over the next two to three months. Hopefully, when the lockdown is done we will have a clearer image because it’s hard as a businessman or an operator to forecast in such difficult times; I cannot see one month in advance what’s going to happen in Lebanon so it’s hard to really forecast with accuracy, but you can definitely set the plans of what you wish to achieve and work hard on it, regardless if it happens or not that’s fine. I am totally okay with the plans not coming to life as long as we work on them and we do our best.
For Shuttles to grow further, can you tell me the three things that you need help with?
Richard: This is quite a difficult question because I am really grateful to have people around me who are very supportive. The businesses that we work with are also very supportive, so if anything I want to be able to help others as well. Perhaps being better in terms of operations, optimizing our service in order for us to enhance the quality even more, but I really feel like we have been blessed to have the success that we’ve had. I really call it a success to have gone from absolutely nothing, it is mind-blowing to me that we are able to grow the business and have actual employees. Never in my dreams have I thought at my age, or at the state that I am in right now, I would have employees that I have to take care of, it’s absolutely crazy to me. I really want to be able to help other businesses in turn. People here really need help and especially e-commerce businesses. During this crisis we have had such a boom in businesses who are doing handcrafted and personalized items, accessories, boxes etc., it has been very interesting to see. Some people are finding their success, some people are struggling and it would be a very exciting chance if we can help these businesses find their success.
About the Guest
A recent graduate from Lebanese University holding a Civil Engineering degree, Richard El Cheikh has been faced with the pandemic reality at the beginning of his professional career during the harshest labour market since the Great Depression. He had two crossroads, either going to spend a long time unemployed or do something about it. He decided to take the later path of entrepreneurship and started to look for opportunities in Lebanon and with the help of his father, they have founded their delivery service company, Shuttles.