Today I had the pleasure of attending a conference on e-commerce delivery innovations organized by my friend and advisor, Scott Rafer. First of all, I must say that I was excited to hear that people in Silicon Valley are interested enough in the shipping industry to organize an entire conference on the subject, for shipping is too often underestimated and considered quite boring. Second, I was simply thrilled to see that, in the past two years, shipping delivery companies have been thriving and that there were enough newcomers to this conference to fill an entire day of panels and discussions.
I’d like to share my brief thoughts on the most compelling categories & companies in the shipping value chain that I encountered today:
When I say “shipping”, the first thing that probably comes to your mind is freight shipping. As in using actual ships to move your goods. One of the companies present today from the “real” shipping industry was Haven, which is a marketplace for ocean freight shipping. They automate ocean freight shipping container reservations for shippers looking to fill and ship entire containers to another port.
The typical SMB e-commerce store owner will probably not need access to freight logistics, however, a whole slew of startups have emerged who focus on making the lives of e-commerce store owners easier. Those companies represented today were: Shiphawk, Shipwire, Trak, and, of course, Shippo.
Shiphawk, Shipwire, and Shippo are solving problems that directly stem from the growth of Amazon. The e-commerce and shipping behemoth initiated the trend of fast & free delivery and returns. Most e-commerce stores can’t compete with Amazon in terms of their economies of scale and, thus, shipping discounts, and they also can’t afford to operate warehouses across different countries to serve international markets. Drop-off rates at check-out for e-commerce stores increase by 28% if store owners decide to add shipping costs to the item price. Many stores suffer from additional complexity by selling very diverse items, ranging from small items that can be shipped with normal shipping providers, to large items, such as furniture, that require special delivery services.
Shipwire provides a global fulfillment network as a service. They operate warehouses internationally and help e-commerce SMBs deliver locally through one of their warehouse locations. One key strength of Shipwire’s is that they enable their customers to enter and exit international markets quickly and without any fixed assets, such as physical warehouses.
Shiphawk helps e-commerce SMBs and individual consumers ship larger and heavier items that “normal” shipping providers can’t handle or don’t specialize in. Shiphawk helps both one-time shippers and businesses by providing instant and accurate shipping quotes for irregularly-sized items.
Shippo fits in between Shipwire and Shiphawk. We help e-commerce SMBs who don’t need warehouses or who own their own warehouses ship packages with standard shipping providers, such as USPS, FedEx, UPS, and DHL Express. We help them compare and optimize their shipping rates and processes. We lower shipping costs significantly by providing discounted shipping rates through our economies of scale. And these rates are up to 80% off retail shipping rates. We also help with international expansion by offering discounted international shipping prices.
While Trak also supports SMBs with shipping, they come in to the shipping industry from a different angle. Trak’s mission is to make local delivery efficient and delightful. They ride on the trend of same-day delivery services being up and coming and offer a service to manage and analyze delivery operations.
In the same space as Trak is Rickshaw, a company that supplies fleets to enable same-day delivery for all businesses. They’re a white-label solution that turns any business into Amazon Fresh. While Rickshaw helps businesses service their end-customers better by offering same-day delivery, Doorman is a great example of a delivery service that sells directly to consumers. They help consumers who are facing the pain of missed package deliveries receive their package deliveries at a convenient time when the consumer is at home. Instead of having your order shipped to your house, you choose to ship it to the Doorman warehouse and Doorman sends a driver to bring it over to your place at your desired time.
Extremely happy to see that the shipping industry is getting more attention from the tech scene. On the one side it’s a large and mostly outdated industry that needs to adapt to serve the rapidly developing and increasingly accessible e-commerce landscape. On the other side are the consumers whose delivery expectations have been shaped by Amazon. This disparity leaves room for startups to solve real problems.
To share Damon from Shipwire’s view: “We’re not doing logistics, we’re doing e-commerce.”
Shippo is a multi-carrier API and web app that helps retailers, marketplaces and platforms connect to a global network of carriers. Businesses use Shippo to get real-time rates, print labels, automate international paperwork, track packages and facilitate returns. Shippo provides the tools to help businesses succeed through shipping.