UPS launches fulfillment platform for small and medium sellers

Transportation

Logistics / Transportation 169 Views

UPS launches fulfillment platform for small and medium sellers

Transportation

Logistics / Transportation 169 Views


Dive Brief:

  • UPS launched a new eFulfillment platform to connect small- and medium-sized businesses on 21 online marketplaces — including Amazon, eBay and Etsy — to UPS fulfillment services. UPS claims the solution enables businesses to more easily handle their orders and inventory across various marketplaces from a single location, according to a company press release.
  • The solution also allows businesses to customize delivery times for their products. It offers same-day fulfillment on one-day, two-day and three-day services and will fulfill orders up to 5 p.m. The company inventory will be picked, packed and shipped from a "strategically located" UPS warehouse, UPS explains in a video about the new program. The warehouses are in Kentucky and California, a UPS executive told Supply Chain Dive.
  • "Smaller businesses know they need to offer fast shipping to compete in an environment where this has become standard," Nick Basford, vice president of global retail and e-commerce strategy at UPS, told Supply Chain in an email. "However, not every business can invest in a warehouse and other logistics needed to make that happen. This product provides a nationwide order fulfillment service that is not easy for smaller businesses to do on their own."

Dive Insight:

Online marketplaces like Overstock or Shopify allow smaller companies to get their products in front of potential customers with a professional buying experience. But if business takes off, small companies may need to invest more time in fulfillment and logistics management to meet customer expectations for quick and efficient delivery, leaving fewer resources for business functions such as R&D and marketing.

Solutions like UPS eFulfillment, and similar offerings from Ryder and FedEx, are lining up to provide fulfillment services for these small and medium players since, unlike their massive competitors like Amazon and Walmart, these shippers don't have the scale to negotiate rate reductions that cut into 3PLs' margins.

UPS provides a portal where users can create shipping labels and track orders while UPS handles the shipping and returns, and has already piloted its offering with a handful of companies. Companies are charged monthly for the shipment and storage of their products or $1,000, whichever is higher, for UPS' product.

The amount of money spent on e-commerce has been growing by millions of dollars every year, going back more than a decade now. And with the internet's biggest marketplaces, Amazon, making moves into the freight and logistics space, legacy 3PLs need to do as much as they can to keep from losing out on this digitally-driven business.


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