Kyle Payne – President, Head of U.S. Sales at Lowe Rental

KYLE PAYNE
Speed is starting to be the winning ticket in e-commerce now. And that's very difficult to do out of these very heavy automated systems.

GREG SIMPSON
Welcome to Built2Suit, the show Built to Build. What is Next? I'm Greg Simpson, your host, and today I have someone sitting across from me with one of the most interesting career arcs I've heard in a while. Kyle Payne's current coordinates has been helping grocers and e‑commerce players solve problems. Today, we're talking modular refrigeration, rapid deployment of equipment, and why flexibility is the name of the game in an industry that's changing faster than ever.

KYLE PAYNE
I am vying for the assistant to the assistant regional manager role yet.

GREG SIMPSON
Actually, folks, to solve this more appropriately, he is the head of US sales, only tongue‑in‑cheek assistant to the assistant of the regional manager. But tell us a little bit about your early days, my friend.

KYLE PAYNE
So I started off in the industry in 2013, and it was weirdly not what I went to school for, which will surprise no one, but found my way into grocery retail, dealing with mobility carts and some material handling equipment. Over time, I began to understand that this isn’t the only thing that goes on in these people’s lives. This is part of a much bigger, very complicated retail ecosystem.

KYLE PAYNE
Eventually I started doing more with tech. And that’s kind of been a theme—looking for opportunities to take something mundane and bring value that solves secondary problems. That progressed into working on the smart cart projects that were all the rage during COVID…the Amazon Dash Cart, the Caper carts, things like that.

KYLE PAYNE
You still hear a lot about these. I was lucky to work on many of those projects.

KYLE PAYNE
Then one day I decided I needed to learn more about refrigeration, a part of the industry I hadn't touched yet. I work with Lowe on refrigeration now, and it's been a blast.

GREG SIMPSON
So how long have you been working with Lowe?

KYLE PAYNE
Five years. Five years next week.

GREG SIMPSON
So you go from motorized carts to carts… carts.

KYLE PAYNE
Some tech sprinkled in there.

GREG SIMPSON
Now you're in a high‑end institutional refrigeration space. But I hear that cart thing spun off a side hustle. Talk about that a little bit.

KYLE PAYNE
Yeah, it did. When we were doing all this technology‑focused stuff on carts, one of the things you see is that a lot of those carts get stolen. This was one of those moments of asking: “What are the problems on the periphery? It's not enough to provide a product—what can you do to solve problems?” We tried this crazy idea of GPS‑tracking carts one day and it kind of clicked.

GREG SIMPSON
Well, let's step into e‑commerce. In 2020, we all thought groceries were going to be automatically picked and delivered. Micro‑fulfillment was supposed to take over. Yet we’re seeing headwinds. Is that cost? Complexity? What's your take?

KYLE PAYNE
All of the above. Cost is heavily scrutinized. Complexity is enormous. These systems work well in ambient environments. But once you start picking refrigerated or frozen goods, everything changes. The timing matters. Orchestrating thousands of orders per day becomes very complicated.

KYLE PAYNE
During COVID, people said: “Sure, deliver my order next Friday.” Now it's: “Crap, I forgot eggs—deliver now.” Speed wins. And heavy automated systems struggle to scale quickly enough to match that expectation.

GREG SIMPSON
We saw automation struggle with moisture issues, wheels slipping, multi‑temp behavior. It’s tricky.

KYLE PAYNE
Getting airflow right is very tricky.

GREG SIMPSON
Who’s really on the forefront of solving multi‑temperature automation?

KYLE PAYNE
AutoStore is probably one of the leaders. It's commonly AutoStore vs. Ocado. AutoStore recently opened a multi‑temp installation—ambient, medium, and low temp. Ocado is right up there too. Whoever masters multi‑temp picking quickly will be the preferred solution going forward.

GREG SIMPSON
We’ve seen huge ambient warehouses, but also hub‑and‑spoke approaches. What are you seeing?

KYLE PAYNE
On the robotics side, mostly big deployments. But shrinking automation into 20–30k sq ft sites will be compelling. Delivery density is key. If you have to operate out of a million‑sq‑ft facility, density becomes impossible. Smaller facilities can sit near more customers—which improves economics.

GREG SIMPSON
So let’s get into your personal shopping psyche. Would you allow someone to pick your tomato?

KYLE PAYNE
I do. Would I prefer to pick it myself? Yes. But convenience wins.

GREG SIMPSON
Now imagine that tomato goes into a bin—washing it, monitoring shrink, identifying spoilage. Are we capable of solving that?

KYLE PAYNE
I’ve asked this question. I don’t know. Tell me you know the product status of every item in 20,000 totes in an AutoStore...

GREG SIMPSON
Those bins stack and move constantly. Are we ever going to be able to monitor temperature or condition at the individual bin level?

KYLE PAYNE
I would hope so.

GREG SIMPSON
Early installations had airflow issues. Bins displaced air and created temperature inconsistencies.

KYLE PAYNE
Yes—many were effectively just plastic tubs.

GREG SIMPSON
You're telling me we have technology to monitor every refrigeration case. Can’t we eventually monitor every tomato?

KYLE PAYNE
If someone wants monitoring for every tote, we’d be happy to explore it.

GREG SIMPSON
Let’s zoom out. Kroger announced they’re shutting down some large micro‑fulfillment operations. What happened?

KYLE PAYNE
I’m sure Kroger is still asking that. They entered Florida with Ocado but had no physical stores. Publix and Walmart responded aggressively. In some cases, traditional grocers could fulfill faster through existing stores. If I can get Instacart from Publix in 30 minutes, why wait for a long‑distance Ocado delivery?

KYLE PAYNE
Kroger had early COVID‑era advantages—but as competitors improved, the weaknesses of huge centralized fulfillment centers became clearer. Delivery distances killed the economics.

GREG SIMPSON
Maybe those inefficiencies drove hour‑long delivery times...

KYLE PAYNE
That was never going to work.

GREG SIMPSON
Does this mean you need a strong store presence to compete online?

KYLE PAYNE
Yes. Delivery density matters. If you’re an hour away, you need a thousand stops. Without stores, that becomes impossible.

GREG SIMPSON
What does Europe do better?

KYLE PAYNE
Density. The UK has 60 million people in a Georgia‑sized area. They also capitalize on stores extremely effectively. Tesco, Morrison’s, Sainsbury’s—fulfillment from stores is well‑optimized. Walmart is using similar strategies now.

GREG SIMPSON
Let’s pivot to Amazon. Big announcement this week—they’re merging Amazon Go and Amazon Fresh. Thoughts?

KYLE PAYNE
This has been coming. They shuttered stores in the UK recently. They’ve been slowly integrating Whole Foods and Amazon operations. This isn't a retreat—Amazon experiments constantly. Some experiments are expensive. They stop things that don’t work, but continue pursuing the underlying technology.

KYLE PAYNE
They also just announced a 230,000‑sq‑ft supercenter in Chicago. They’re consolidating—not quitting.

GREG SIMPSON
Given AWS dominates earnings, do you think Amazon prefers being a “commerce platform” over a grocer?

KYLE PAYNE
Possibly. Marketplace + fulfillment is what they really are. Retail as a service.

GREG SIMPSON
Two years ago they were talking less about stores and more about digital carts. AWS revenue overshadowed everything.

KYLE PAYNE
Everything.

GREG SIMPSON
Are Amazon and Whole Foods even compatible?

KYLE PAYNE
They've been asking that since 2017. Whole Foods was already changing before Amazon bought it. I think Amazon may eventually blend more convenience products into Whole Foods, even if I personally wish they wouldn’t.

GREG SIMPSON
So will we see toilet paper in Whole Foods?

KYLE PAYNE
Probably. Maybe organic toilet paper.

GREG SIMPSON
Could they preserve the Whole Foods brand by keeping non‑core products “in the back”?

KYLE PAYNE
They’ve tested side‑by‑side Amazon + Whole Foods stores. They may keep experimenting. They can roll out in select markets first. But I do think we’ll see more mainstream items on Whole Foods shelves.

GREG SIMPSON
Let’s talk the delivery space: DoorDash, Instacart… who wins the last mile?

KYLE PAYNE
DoorDash is interesting—they have some of their own fulfillment assets. Not Amazon‑level, but meaningful. DoorDash could leverage micro‑fulfillment more aggressively. Instacart tried going robotic with Fabric, but that partnership fizzled. But they clearly intend to play in fulfillment-as-a-service someday.

KYLE PAYNE
Large chains like Walmart and Kroger can vertically integrate. Regionals? Maybe not. That’s where DoorDash/Instacart could fit.

GREG SIMPSON
This model sounds like what drone operators want to do—start near stores, then expand outward.

KYLE PAYNE
Drone delivery is still far‑fetched. Florida has tons of airports, making it even harder. But yes, the principle is similar: faster, hyperlocal fulfillment.

GREG SIMPSON
What’s the next big unlock in the industry?

KYLE PAYNE
Private label. Maha movement. GLP‑1s. Massive resets in center store assortment. Grocers have to rethink product mixes—less CPG dominance, more differentiated offerings.

KYLE PAYNE
And whoever nails e‑commerce efficiency—delivery, pickup, or pickup‑somewhere—will win. Delivery economics remain the biggest hurdle.

KYLE PAYNE
Labor costs aren't going down. Tech adoption is faster than before, but big innovations like self‑checkout took decades. The next winning innovation won’t be drones or massive robotics—it’ll be something smaller, practical, and scalable.

GREG SIMPSON
And store friction—especially checkout—still remains a huge pain point.

KYLE PAYNE
Smaller, nimble formats might be the future. Giants like Walmart will still build massive supercenters, but traditional grocers may need compact, fast‑to‑deploy stores with tight assortments and the right automation.

GREG SIMPSON
What about the future of refrigeration? What will surprise us in 5–10 years?

KYLE PAYNE
If I knew that, I'd be calling in from a Caribbean island. But yes, innovation is coming. Refrigeration is built on the vapor compression cycle—there might be another way someday. The question is how long it will take.

GREG SIMPSON
All right, gang—that does it for part one. Next time, we’ll dive deeper with the same guest Kyle Payne, making the impossible possible as he breaks down commercial refrigeration and compares what's coming in the US with what Europe and other players are already doing. I'm Greg Simpson. Don’t miss part two of the Built to Suit Podcast, Built to Build What’s Next.