Jan 22, 2021 | Blog, The Packet
Front and Center
Walmartville, USA
Games like Tycoon City, MineCraft and SimCity just don’t cut it for this guy… Marc Lore, the head of Walmart eCommerce US, has announced that he is leaving Walmart at the end of January to start a “city of the future” built on a “reformed version of capitalism.”
The vision statement for the project reads: “Imagine a city with the vibrancy, diversity and culture of New York City combined with the efficiency, safety and innovation of Tokyo and the sustainability, governance, and social services of Sweden. This will be our New City.” Nobody tell this guy about Disney world…
So what will it look like?
For starters, each road leading into the city will be stationed with a senior citizen in a blue vest greeting you as you drive in… kidding. Details about the city have not yet been released, but Marc has promised that more information will be released over the coming months.
“This is going to be a lifelong project,” Marc says. “It’s the thing I’m most passionate about.” He plans to write a book and create a TV show to cover his city-building escapades. You can watch him describe his vision in the full interview here.
Who is future mayor Marc Lore?
Marc Lore is a serial entrepreneur that most famously founded Jet.com, a major competitor to Amazon, who then sold it to Walmart for $3 billion USD cash in 2016. He and his executive team arrived at Walmart with inside knowledge of Amazon, having previously sold his company Quidsi, a collection of online shopping sites best known for Diapers.com, to Amazon for around $550 million in 2011.
Since joining, Walmart eCommerce has seen tremendous growth, and Walmart.com became the second biggest ecomm site after Amazon in the US, quickly shedding its past reputation as an ancient relic in the new digital age of commerce.
Is this bad news for Walmart?
No. Walmart president and CEO Doug McMillon announced to the company that Marc will remain a partner and advisor for the company.
Back of the Packet
Inauguration
Aaaaaand they’re off! Our 46th President Joe Biden and our 49th VP Kamala Harris didn’t waste any time on their first day in office. President Biden signed at least 17 executive directives on things like COVID-19, the economy, climate change, and racial inequality.
Notably, Biden rejoined the Paris climate deal, while disallowing the permit for the Keystone XL pipeline. He also placed a mask mandate on all federal property, and issued to Americans a challenge… not to dump ice water on your heads or inhale a spoonful of cinnamon, but instead to mask up for 100 days. Sounds do-able.
As for the inauguration ceremony, Lada Gaga with such beauty and grace kicked off the 2021 Hunger Games.
At the same time, Bernie kicked off a global fashion craze. Our professional advice for the fashion and accessory industry is that people will be going gaga over giant brooches and earth-tone plaid print gloves.
Vaccine Stipend
A growing number of grocers are offering their employees paid incentives to get vaccinated against COVID-19.
This week, Aldi announced to employees that they would receive compensation for getting vaccinated, two hours of pay for each of the two vaccine doses and that they would be paid their hourly wage on top of that. Not a bad deal.
Aldi joins the ranks of Trader Joe’s, Dollar General, Instacart, and others that are incentivizing their employees to get the vaccine.
“Providing accommodations so employees can receive this critical vaccine is one more way we can support them and eliminate the need to choose between earning their wages and protecting their well-being,” said Jason Hart, CEO of Aldi U.S.
ShipHero News
We’ve Invented the Wheel
It’s no secret that today’s world of ecommerce is changing rapidly. Third party logistics (3PL) and fulfillment providers that don’t find a way to keep up with, if not surpass, the pace of growth during this ecommerce boom is at serious risk of getting left behind.
That’s why we invented The Fulfillment Innovation Wheel: a list of twelve capabilities and service offerings that 3PLs need to implement in order to be successful, as well as the capabilities and service offerings that retailers and brands should look for when partnering with a 3PL.
Stay tuned as we break down each of the twelve capabilities, starting with Designed for Returns.
Get Featured
We are reaching out to our Packet community. Would you like to share with us stories about your ecommerce experiences, whether it’s how you started your business, what opinions you have on the stories we share, or if you just feel like venting… we’re here for you.
Email us at thepacket@shiphero.com and you could be featured on an upcoming edition of The Packet, or if you’re lucky, you could be invited to join one of our many Podcast episodes or featured on our Blog!
Check out the packets you missed here and Subscribe below so you don’t miss the next one!
Oct 23, 2019 | Blog, Case Study
We realized there was no way we’d be able to continue filling orders one year down the road at the rate we were growing. We were excited by the growth, but we needed a software solution like ShipHero.
— Jake Rajsky, Vice President, American Tall
Challenges
Scaling fulfillment with rapid business growth
Finding high-quality, well-tailored men’s clothing online can be a tall order—especially for men who are 6’3” or taller. So there was high demand when American Tall, a men’s apparel brand, launched their direct-to-consumer ecommerce site.
At first, the small family business relished picking and packing each order by hand. They even enclosed personalized thank- you cards with each order. But as their business grew, keeping up with order fulfillment became a challenge.
Download Case Study
Oct 8, 2020 | Blog
You are an eco-conscious consumer. Maybe you turn off and unplug your lights, or you try to reduce water consumption. You may buy second-hand products, or perhaps you are well-studied on the long, long list of rules for recycling.
Maybe you carpool or ride a bike, or you have a garden and shop for organic produce. You do all the eco-friendly things that would make Al Gore blush; but now consider this inconvenient truth: each and every time a package arrives on your doorstep within 48 hours of ordering, also known as same-day delivery or two-day delivery, the environmental costs of such an expedient service are wasting all of your carbon-diminishing habits.
“The time in transit has a direct relationship to the environmental impact. I don’t think the average consumer understands the environmental impact of having something tomorrow vs. two days from now. The more time you give me, the more efficient I can be.” That is a quote from Patrick Browne, director of global sustainability at UPS.
The advent and booming popularity of same-day and two-day delivery have forced delivery and fulfillment companies to take more inefficient and carbon-intensive routes, passing both the financial and environmental costs on to the consumers. Yes, the shipping may appear to be ‘free’, but that is because notable e-commerce giants are fronting the logistics costs for competitive reasons while doing all they can to disguise the true costs, the harm to our environment. Cue Captain Planet.
Let’s delve into the environmental impacts of the services provided by these e-commerce giants, and then examine carbon-friendly solutions with promises of the exact same delivery times.
The Cost of Consumer Expectations
You wake up in a cold sweat. It is your dear mother’s birthday tomorrow, and you have nothing, nada, zip, zilch, diddly-squat… just like last year. You’re out of excuses, and more importantly, out of time. What is a desperate son or daughter to do? Well have no fear; up in the sky, look! It’s a bird, it’s a plane, no! It’s a delivery drone coming to your rescue. Ah, the future.
The trend of faster delivery times, from click to door, has always been a point of competition amongst e-commerce companies, with a 2019 study conducted by Rakuten Intelligence showing that delivery times have been steadily decreasing the previous two years from 5.2 days to 4.3 days. And today, over 50% of shoppers between 18-35 years old have reported that they expect same-day shipping and will opt for speed of delivery; however, 90% of consumers reported that they would opt for free delivery over speedy delivery.
So, are you willing to trade speed for the eco-friendly, green alternative? If so, you are in the vast minority. A study by Forbes in 2019 showed that 95.6% of consumers were not willing to make the trade-off of speed for package consolidation, and 54% of consumers mention ‘speed of delivery’ as their top delivery consideration when shopping.
Our expectations as consumers are trending towards not only the same day but within 1-3 hours for some products. The promise of e-commerce was economies of scale, allowing companies to synergistically ship orders to your door in a more environmentally-friendly way when compared to each consumer driving to the store in their own cars. These initial environmental benefits are now at risk as shipping gets artificially pushed to be faster and faster.
Environmental Costs of Shipping
You may be thinking, how bad is bad? Well, in the worst-case scenario, a package delivered the same-day could result in carbon emissions up to 35 times more than if the delivery had been done efficiently. These abhorrent emission numbers can stem from carriers relying heavily on air freight, which values speed, instead of the lower carbon option of ground freight.
Transporting 2 tons of freight over 500 miles with a truck creates just 12% of the carbon emissions used to do the same with a plane. That’s right, give a trucker a hug. The air freight option is much more expensive and carbon-intensive than ground freight and is used solely in the case where goods need to be shipped long distances, quickly. This, of course, requires a lot of energy and fossil fuel.
Not only does air freight emit over 8 times the carbon, but the effects of these emissions are also 2 to 3 times more harmful compared to carbon emissions from ground transportation because airplanes release the carbon at high altitudes into the atmosphere, where they contribute much more to the greenhouse effect.
While larger delivery companies are able to combat a portion of these added carbon emissions by purchasing more carbon-neutral vehicles or packaging, the large majority of companies that are struggling to compete, such as meal kit delivery or razor subscription box companies, just cannot afford to be environmentally-friendly, and unfortunately, it will be all of us that will pay the price.
Solutions for Low Carbon Delivery
“But it’s my mom’s birthday tomorrow and I need to get something, like, today!”, you may be saying to yourself. Or, “Shouldn’t that be the company’s job to be environmentally friendly?” Well, absolutely. Here are some ways that companies are meeting consumer expectations for quick service, all while reducing the added carbon footprint.
Implementing Machine Learning
One of the major trends in 2020 for delivery and fulfillment will certainly be the injection of Artificial Intelligence (AI) and Machine Learning into the supply chain. According to McKinsey & Company, businesses can expect to gain between $1.3 trillion to $2 trillion a year in economic value by using AI in their supply chains.
These computing solutions have limitless potential to transform the supply chain and logistics network. The main impact of these solutions can be found in the following areas:
- Predictive demand: tuning Machine Learning models to predict and forecast demand, using order metrics, product data, and real-time KPIs, will allow companies to shorten shipping distances, lower delivery time, and eliminate the need for carbon-intensive air freight in some circumstances.
- Smart Warehouses: Smart warehouses are able to simplify and automate the tedious tasks of picking, packing, and shipping, thereby creating a greener and more cost-efficient system.
- Route Optimization: Route planning using real-time location data allows companies to optimize ground routes with various stops, allowing them to fill ground vehicles more efficiently and aim to reduce fuel consumption.
Delivery and smart fulfillment companies like ShipHero are realizing the potential of Artificial Intelligence and Machine Learning to solve the complex problems presented by logistics and supply chain operations; and when configured correctly, Machine Learning has the ability to help key business leaders get the real-time information they need to make smart decisions.
Considering the present-day state of shipping and delivery during the COVID -19 pandemic, with shipping carriers at capacity and consumer demands at all times high, companies must rise to meet this watershed moment where e-commerce has seen 5 years of growth… in just four months. So being able to combine these new technologies, a wide fulfillment network, and transportation optimization will present a radical new shift for e-commerce logistics.
Reducing Waste
Single-use and disposable materials are terrible for our environment, filling up landfills, waterways, and the bellies of poor turtles. Fulfillment companies like ShipHero are switching to recyclable packaging, thereby eliminating single-use materials, and using sustainably sourced paper and recyclable packaging.
Waste can also be created by overproduction, unnecessary inventory, and unnecessary transportation, all of which can be addressed and reduced through a smart fulfillment platform set with a goal to lower and optimize carbon emissions. So how can companies measure their carbon emissions?
Transparent Reporting and KPIs: A Competitive Advantage
Almost half (46%) of surveyed global consumers said they would be willing to forgo a brand name in order to buy environmentally friendly products. In this information era ripe with cancel culture, brands should be sure to show-not-tell their customers how they are being eco-conscious, lest join the expanding list of canceled brands.
Over 73% of global consumers say they would definitely change habits to reduce environmental impact and over half of shoppers choose brands based on sustainability; so, brands that are notably eco-friendly like Lush Cosmetics, Patagonia, and TOMS make sure to advertise just how eco-friendly they are. In order to meet the expectations for this majority of consumers, companies must be able to demonstrate this competitive advantage through transparent reporting and Key Performance Indicators (KPIs).
When warehousing, distribution, and fulfillment activities are all performed by a singular entity, carbon emissions and footprint are much easier to monitor, optimize, and report. These are brand new reporting capabilities that could not have been made under standard fulfillment methodologies, and now these capabilities can be developed even further. Taking the approach to continually build out more eco-friendly reporting services at a steady pace, ShipHero can make a difference now, all while continuing to evolve them over time; and they even envision a future service where carbon savings are published and available for every shipment with a simple scan of a QR code included on the shipping label. What’s important to note is that ShipHero does all of this while maintaining the exact same delivery times (between 3-5 days) that you and your consumers have come to expect.
Then, these carbon emission optimization metrics are passed onto you, so that you can communicate them to your loyal, eco-aware customer base.
Apr 17, 2018 | Blog
ShipHero has distributed teams that are located in the US and Argentina. As we’ve grown, we’ve also evolved how we communicate and track tasks.
We share some of our tools and practices with the team at Daxx as we discuss how our teams stay connected and productive.
Nov 19, 2017 | Blog
After coming up empty handed when searching online for affordable, stylish clothes in a range of sizes, stay-at-home mom Leslie Hall decided to create her own boutique. Shortly after she started filling a 10×10 room in her home with choice inventory, demand for her products quickly soared.
Turned out, countless women just like Hall were eager to find the exact same thing.
In less than four years, ZigZag Stripe exploded and now boasts a proper warehouse facility, three brick-and-mortar stores, and fifty employees. Still family owned and operated, the now-multimillion dollar company has gained a reputation for its fashionable, American-made pieces that flatter a variety of body types.
Of course, it’s due to this reputation that ZigZag’s customers are regular and avid shoppers, many purchasing products multiple times a week. Initially, the growing business had difficulty tracking these orders and often sent them out individually. Using paper print-outs, different warehouse staff would sift through the stock – much of which would be dwindling quickly due to the high demand – and ship each item separately to the same customer’s home. The result, of course, was wasted time and money.
After a particularly harrowing period when the warehouse team struggled to fulfill a huge influx of unexpected orders, ZigZag Stripe decided to use the ShipHero platform. The first day that they used it, they got 200 additional orders out the door. And within the first month, they no longer had the usual fifty or so erroneous orders that resulted from typical human error.
But, the feature that really sealed the deal was the “merge” function.
Now, when customers placed multiple orders in a short timeframe, ShipHero merged them into one. All warehouse staff had access to real-time status of all these orders, so no extraneous shipments were made. And, the warehouse team were able to find the lowest shipping rate for one shipment instead of multiple. As the manager of operations, noted: for a company with a “cult-like following,” the merge function “has made a world of difference.”
The merge function is just one of the many groundbreaking features that ShipHero uses to help growing businesses fulfill orders and save money on shipments. To learn more about how our platform can address your e-commerce company’s unique needs, please contact us.
Nov 16, 2020 | Blog, Fulfillment, Warehouse Management Software
ShipHero Ecommerce Fulfillment Trends – Week in Review For November 16, 2020
Introducing the ShipHero weekly shipping trends report. ShipHero provides warehouse management software and outsourced ecommerce fulfillment to over 4,000 brands, processing an annual gross merchandise volume (GMV) of over $5 billion.
In an effort to provide useful data to the DTC community during Covid and the rapid changes occurring in our industry, we are sharing some of the broad segment trends from the products on our platform. Here is the data for the week ended November 16, 2020:
More charts available on data.shiphero.com.
Do you find this information useful? Let us know! Twitter: @weareshiphero or Email al@shiphero.com.
May 8, 2018 | Best Practices, Blog
Originally posted on Home Business Magazine
Small business owners are faced with a difficult decision when it comes to reaching a larger audience online: either they can invest valuable resources in marketing in order to drive customers to their ecommerce store, or they can opt to sell on marketplaces where customers go already.
There are several marketplaces that retailers can utilize in order to reach new customers and increase their online sales. These range from targeted niche platforms such as Jane or Etsy, to all-encompassing behemoths such as Amazon, Walmart and even Ebay. While most of us are aware of Amazon and Walmart’s online presence, Amazon undeniably dominates ecommerce. However, Walmart has been investing millions to improve it’s online marketplace and is the most likely outlet to compete for Amazon’s clients. Still, many retailers default to using the Amazon marketplace without considering Walmart as a viable option to sell their goods.
However, there are several downsides to going this route. Amazon not only charges the retailer to list the items (unless the seller plans to post fewer than 40 listings), but they also take a percentage from every sale made. These costs can quickly add up, especially if a seller lists a large number of products on the site.
Another drawback is the issue of returns. Amazon makes a profit just from the items being listed and sold, so if a customer returns an item, it is at no cost or loss to Amazon. Amazon has built an experience aimed at the customer, not the seller, making it difficult for sellers to manage customer expectations, even when it comes to a returns policy that favors the customer. This means that customers are able to return items months after they purchased them – sometimes for no discernible reason – at the expense of the seller.
Many retailers have also encountered cutthroat competitors on Amazon, who often resort to a myriad of unscrupulous practices in order to derail others successfully selling similar products. These range from posting bogus negative reviews to undercutting a competitor on price by offering counterfeit items. These practices run rampant largely because Amazon has such a low barrier to entry into it’s marketplace. Sellers don’t go through any kind of screening process in order to participate, needing merely to sign up prior to listing their products.
These are just a few reasons that many retailers have started to look elsewhere to post their listings – and one viable platform is the revamped Walmart.com. Walmart.com is the third largest internet retailer and it’s ecommerce sales are projected to surge 40% this year. The retailing giant has also spent billions on ecommerce fulfillment centers and boasts over 110 million unique visits a month. And, many retailers will find that the Walmart marketplace is simply a better place to sell their products. Here’s why:
- Walmart doesn’t charge a listing fee. Amazon charges $39.99 a month just for retailers to list items (individual seller listing less than 4 items accrue this charge, however) Both marketplaces do charge ” referral fees” for each item sold, averaging around 15% depending on the item.
- Less competition. Walmart has a drastically smaller product selection compared to the “Everything Store,” which also means that sellers can enjoy a less crowded marketplace with fewer competitors. In fact, retailers with products in less popular categories find that they sometimes have the room to themselves – a luxury tat.
- Their screening process ensures reputable sellers. While it is infinitely easier to sign up and sell on Amazon’s marketplace, Walmart’s more involved admission process also helps weed out any of those cutthroat sellers who resort to unethical practices in order to derail their competition. Admittedly, the screening process takes time and effort, but the payoff is worth it for those who want to sell alongside creditable retailers.
- Retailers have more control over returns. While Amazon favors the customer and requires sellers to adhere to certain guidelines when handling returns, Walmart allows retailers to determine how they want to deal with product returns. This allows sellers the opportunity to resolve the issue and to reduce the number of returns resulting from fickle or unnecessary customer whims. While Amazon will require retailers to issue a full refund without gathering any information from the customer and doesn’t require the buyer to return the item, Walmart allows sellers to ask the customer to return the product prior to offering a refund, or to resolve the issue in other ways.
Admittedly, the Walmart audience doesn’t entirely overlap with Amazon’s. Depending on your product, this can be the determining factor for whether or not you use Amazon’s marketplace to sell your items or opt for affiliating with Walmart. However, retailers whose products are buried under thousands of competing products will find the newcomer’s space amenable to increased sales and reduced competition.
