7 ms·

Deliverr raises $7M to help e-commerce businesses compete with Amazon Prime

60 points by arturnt 8y ago

sglasman 8y ago
Cool Company! I am going to reach out now!
technologyvault 8y ago
The article talks mostly about Wal-Mart, eBay, and other very large retailers, but I noticed that they also have options for small businesses.
- habbott 8y ago
  In fact it is designed for small merchants - and enables you to sell on Walmart, eBay and Shopify stores with fast shipping
- masonic 8y ago
  eBay is not a retailer. It is a marketplace for other retailers.
deleted 8y ago
[deleted]
jbob2000 8y ago
Any company who uses Deliverr is going to quickly figure out that they have placed their most important business process in the hands of a third party, and that they have very little control over it. eBay, Wal-Mart, and Shopify are in the business of delivering products. They don't make the products, they make them available to the consumer. Delivery is like 90% of that. This is why amazon runs their own fulfillment centers, it's the most important part of their process. It would be better for eBay, Wal-Mart and Shopify to merge and compete against amazon as one, rather than fighting over the table scraps that amazon leaves them.
- habbott 8y ago
  I disagree with you on many fronts - First any business should ask for metrics on past performance and that is how you should judge the performance and not by assertions or business models - Case in point -- Taxis were fully controlled they all looked the same, the drivers were all trained the same way -- yet the consumer experience was bad. Then Uber/Lyft came in and they don't drive the taxis but they are able to orchestrate demand and supply and offer visibility and a better price to customers. So going by your analogy Taxis >> Uber. But I think it is settled that Uber/Lyft >> Taxi. Judge Uber/Lyft with their metrics such (a) time to get a taxi (b) on time delivery and (b) cost to consumer. And businesses and consumers are smart enough to do that. Second - marketplaces are in business of connecting buyers with sellers; laying out rules of engagement so trust is built for discovery and transaction. They are enablers. But a merchant participates in many markets and not just one. You cannot ask each marketplace to do fulfillment for the merchant because that will mean the merchant will have to predict and send inventory for eBay and Walmart and Shopify separately which is not efficient for anyone in the market.
  - jbob2000 8y ago
    Ok, I hear you, but I think you're missing the forest for the trees - Why did amazon beat these businesses in the first place? It wasn't because they connected buyers with sellers, people have been doing that for decades. It has nothing to do with the rules of engagement, amazon is full of fake products and reviews. It wasn't because the user experience was bad, the amazon UX is pretty bad, it's very cluttered, and Shopify's UX is really impressive. Amazon beats Wal-Mart et al. because their delivery is faster. And that takes control. The difference between delivering in two days and delivering in three days comes down to seconds. And for what it's worth - Sometimes I am unable to get an Uber, but every time I call the taxi company, a taxi shows up. (All of this isn't to say Deliverr won't provide value, just that I am doubtful it can beat amazon)
    - saas_sam 8y ago
      >> And for what it's worth - Sometimes I am unable to get an Uber, but every time I call the taxi company, a taxi shows up. FWIW from me, I have had taxi companies fail to send me a taxi, or send me one hour+ after they said they would, every time I have called them in the small cities I've been in that didn't have uber. I can count the times I didn't get an uber when I wanted one on one hand, and I get dozens of them a week...
arturnt 8y ago
I run engineering at Deliverr. Happy to answer any questions.
- danimal88 8y ago
  What's the best way to learn more if we are company selling off of shopify. Logistics is definitely a place where you can win and lose customers.
  - habbott 8y ago
    Please email info@deliverr.com - Deliverr is pre-integrated into shopify so it should be very easy to get started
- jbob2000 8y ago
  Are you guys running bots to promote your service? What's with the new accounts saying overly nice, but shallow things about your service?
  - arturnt 8y ago
    We definitely aren't. I posted this to our Slack and one of our new sales guys created an account and posted. When I saw it I asked him to take it down.
- wpietri 8y ago
  As one of the people grumbling in the bit "ugh, Amazon" thread earlier today [1], I'm delighted to see somebody tackling this. [1] https://news.ycombinator.com/item?id=18147063 https://news.ycombinator.com/item?id=18147063
- markdown 8y ago
  Will Deliverr accept being the Ultimate Consignee on the shipping documentation for a foreign Importer of Record?
  - 8y ago
MetalGuru 8y ago
Isn’t this what selling 3rd party on Amazon is? They handle fulfillment and delivery? I think it’s a good idea since I don’t think eBay or Walmart offer this service (?), and I’m continually hearing how Amazon is screwing over their 3rd party sellers (Amazon basic to replace 3rd party products that sell well, etc). What would you happen to you guys if say Walmart started offering 3rd party fulfillment? Think they could do it well?
- arturnt 8y ago
  Amazon has a program called Multi-channel fulfillment. But there are significant drawbacks to sellers and marketplaces: 1. It comes in an Amazon box. Large marketplace have started penalizing sellers for that. 2. They don't integrate into fast shipping programs that act like Prime, as an example eBay eGD. You are right that eBay and Walmart can offer this service, but most sellers will sell in multiple places, and splitting inventory across different facilities is expensive, inefficient, and difficult to manage. Isolationism in this market hurts everybody.
abtinf 8y ago
Commenting only on the title here (I haven't RTFA yet or heard of Deliverr before)... Amazon is a logistics powerhouse. $7M probably wouldn't even cover the capital investment of a fraction of their equipment in just one of their warehouses. Claiming a series A startup is going to compete with that is a surefire way to discredit it.
- tcho 8y ago
  I'm part of the team at Deliverr. The implication that the $7M will go towards building a parallel infrastructure is not an accurate view of the strategy. This company is setting up the infrastructure to leverage the vast investments in warehousing that already exist all over the US. Definitely recommend reading the article, it does a solid job of summing the mission up :)
- habbott 8y ago
  Two things a) I dont think this is competing with Amazon infrastructure. Outside of Amazon, this is a very large industry and very broken which needs to be fixed. b) I agree with you 7M is not going to be enough to fix this industry; its complex and moves physical things (way harder than moving bits) but you gotta start somewhere.
throwawaylalala 8y ago
I’m am ecommerce seller; why Deliverr inatead of Shipmonk, Shipbob, Easy Post? Do you have clear and transparent pricing?
- habbott 8y ago
  Absolutely the pricing is per unit per SKU - all inclusive of receive, shipping, box and pick pack. I think you will find pricing to be at least 30% lower. You can check out pricing for your items here - https://deliverr.com/fulfillment-cost/ https://deliverr.com/fulfillment-cost/ However the bigger reason for our existence is faster shipping. You can now affordably do 2 day shipping on Walmart and Guaranteed Delivery on eBay and offer 2 day shipping on your Shopify store. You can see here the sales boost we are seeing with fast 2 day shipping -- https://deliverr.com/walmart/ https://deliverr.com/walmart/
- tcho 8y ago
  Here’s one reason: Deliverr’s cheaper.
bvssatish 8y ago
We use "AWS" :)
arosier 8y ago
I was interested, so I dug a little. Here is my conclusion: While Amazon continues to lower the cost of fulfillment through management and the development of new technology that is driving operational efficiencies, Deliverr tries to lower fulfillment cost by gaining access to excess warehouse capacity for pennies on the dollar. The below pricing shows that Deliverr is able to drive value by offering competitive pricing on the fastest shipping times over other third party logistics providers (3PL). They claim they are able to achieve this cost savings through their "machine learning and predictive intelligence" which they use to determine which of its warehouses to store its client’s goods. However, they go on to say they typically only store the good's in 3-5 warehouses. This means any 3PL should be able to compete on pricing for "2 days shipping" by having 3-5 properly placed warehouses. It seems the key cost saver for Deliverr is their outsourcing of the fulfillment to the excess capacity of the third party fulfillment centers. Using a similar model as Uber. According to this article that states the amount of warehouse space that goes unused on any given day is 4 billion square feet, or roughly 30 percent of total warehousing: https://www.pymnts.com/matchmakers/2017/warehouse-space-matches-customers-with-unused-storage-spaces/ https://www.pymnts.com/matchmakers/2017/warehouse-space-matc.... If deliver is able to unlock only 1.7% of this space for pennies on the dollar, they will achieve FBA warehousing scale (77 million square feet: https://archpaper.com/2017/08/architecture-fulfillment-centers/ https://archpaper.com/2017/08/architecture-fulfillment-cente...) and FBA pricing. In determining if they will be able to gain access to the 1.7% of excess warehousing and maintain SLA's, it is interesting to see what the current warehousing market is in the US. According to this report: https://www.logisticsmgmt.com/article/cbre_research_shows_that_many_u.s._warehouses_are_under_equipped_to_meet_e https://www.logisticsmgmt.com/article/cbre_research_shows_th..., it seems the majority of this excess warehouse space is most likely not well suited to efficiently deliver on the type of fulfillment Deliverr is advertising. "In data analysis for 56 major U.S. markets, a key finding from CBRE showed that the majority of facilities built before the mid-2000s have certain limitations that hinder e-commerce distribution usage, including low ceilings, small footprints, uneven floors, and inadequate docking." The article goes on to mention that only 11% of total warehousing in the US (1 billion square-feet) was built within the past 10 years. It does not mention how much of this space is not being occupied on a daily basis. It would seem Deliverr will need to access about 7% of this warehousing, at a fraction of it's 3PL rate, to reach FBA scale. Unlike Uber drivers, let's hope Deliverr's fulfillment partners are pricing their excess capacity appropriately so as to be able to afford to pay their employees a living wage. Deliverr pricing example for an iMac: https://deliverr.com/fulfillment-cost/B071G2S8LZ/apple-imac-mne92lla-27 https://deliverr.com/fulfillment-cost/B071G2S8LZ/apple-imac-... Amazon Multi-channel: Standard: $29.07 3 Day: $30.07 2 Day: $30.07 Deliverr: Standard: $26.73 3 Day: $29.70 2 Day: $29.86 Typical 3PL: Standard: $19.74 3 Day: $83.29 2 Day: $83.29

60 points by arturnt 8y ago

Cool Company! I am going to reach out now!

The article talks mostly about Wal-Mart, eBay, and other very large retailers, but I noticed that they also have options for small businesses.

habbott 8y ago
In fact it is designed for small merchants - and enables you to sell on Walmart, eBay and Shopify stores with fast shipping
masonic 8y ago
eBay is not a retailer. It is a marketplace for other retailers.

deleted 8y ago

[deleted]

jbob2000 8y ago

Any company who uses Deliverr is going to quickly figure out that they have placed their most important business process in the hands of a third party, and that they have very little control over it. eBay, Wal-Mart, and Shopify are in the business of delivering products. They don't make the products, they make them available to the consumer. Delivery is like 90% of that. This is why amazon runs their own fulfillment centers, it's the most important part of their process. It would be better for eBay, Wal-Mart and Shopify to merge and compete against amazon as one, rather than fighting over the table scraps that amazon leaves them.

habbott 8y ago
I disagree with you on many fronts - First any business should ask for metrics on past performance and that is how you should judge the performance and not by assertions or business models - Case in point -- Taxis were fully controlled they all looked the same, the drivers were all trained the same way -- yet the consumer experience was bad. Then Uber/Lyft came in and they don't drive the taxis but they are able to orchestrate demand and supply and offer visibility and a better price to customers. So going by your analogy Taxis >> Uber. But I think it is settled that Uber/Lyft >> Taxi. Judge Uber/Lyft with their metrics such (a) time to get a taxi (b) on time delivery and (b) cost to consumer. And businesses and consumers are smart enough to do that. Second - marketplaces are in business of connecting buyers with sellers; laying out rules of engagement so trust is built for discovery and transaction. They are enablers. But a merchant participates in many markets and not just one. You cannot ask each marketplace to do fulfillment for the merchant because that will mean the merchant will have to predict and send inventory for eBay and Walmart and Shopify separately which is not efficient for anyone in the market.
- jbob2000 8y ago
  Ok, I hear you, but I think you're missing the forest for the trees - Why did amazon beat these businesses in the first place? It wasn't because they connected buyers with sellers, people have been doing that for decades. It has nothing to do with the rules of engagement, amazon is full of fake products and reviews. It wasn't because the user experience was bad, the amazon UX is pretty bad, it's very cluttered, and Shopify's UX is really impressive. Amazon beats Wal-Mart et al. because their delivery is faster. And that takes control. The difference between delivering in two days and delivering in three days comes down to seconds. And for what it's worth - Sometimes I am unable to get an Uber, but every time I call the taxi company, a taxi shows up. (All of this isn't to say Deliverr won't provide value, just that I am doubtful it can beat amazon)
  - saas_sam 8y ago
    >> And for what it's worth - Sometimes I am unable to get an Uber, but every time I call the taxi company, a taxi shows up. FWIW from me, I have had taxi companies fail to send me a taxi, or send me one hour+ after they said they would, every time I have called them in the small cities I've been in that didn't have uber. I can count the times I didn't get an uber when I wanted one on one hand, and I get dozens of them a week...

arturnt 8y ago

I run engineering at Deliverr. Happy to answer any questions.

danimal88 8y ago
What's the best way to learn more if we are company selling off of shopify. Logistics is definitely a place where you can win and lose customers.
- habbott 8y ago
  Please email info@deliverr.com - Deliverr is pre-integrated into shopify so it should be very easy to get started
jbob2000 8y ago
Are you guys running bots to promote your service? What's with the new accounts saying overly nice, but shallow things about your service?
- arturnt 8y ago
  We definitely aren't. I posted this to our Slack and one of our new sales guys created an account and posted. When I saw it I asked him to take it down.
wpietri 8y ago
As one of the people grumbling in the bit "ugh, Amazon" thread earlier today [1], I'm delighted to see somebody tackling this. [1] https://news.ycombinator.com/item?id=18147063 https://news.ycombinator.com/item?id=18147063
markdown 8y ago
Will Deliverr accept being the Ultimate Consignee on the shipping documentation for a foreign Importer of Record?
- 8y ago

MetalGuru 8y ago

Isn’t this what selling 3rd party on Amazon is? They handle fulfillment and delivery? I think it’s a good idea since I don’t think eBay or Walmart offer this service (?), and I’m continually hearing how Amazon is screwing over their 3rd party sellers (Amazon basic to replace 3rd party products that sell well, etc). What would you happen to you guys if say Walmart started offering 3rd party fulfillment? Think they could do it well?

arturnt 8y ago
Amazon has a program called Multi-channel fulfillment. But there are significant drawbacks to sellers and marketplaces: 1. It comes in an Amazon box. Large marketplace have started penalizing sellers for that. 2. They don't integrate into fast shipping programs that act like Prime, as an example eBay eGD. You are right that eBay and Walmart can offer this service, but most sellers will sell in multiple places, and splitting inventory across different facilities is expensive, inefficient, and difficult to manage. Isolationism in this market hurts everybody.

abtinf 8y ago

Commenting only on the title here (I haven't RTFA yet or heard of Deliverr before)... Amazon is a logistics powerhouse. $7M probably wouldn't even cover the capital investment of a fraction of their equipment in just one of their warehouses. Claiming a series A startup is going to compete with that is a surefire way to discredit it.

tcho 8y ago
I'm part of the team at Deliverr. The implication that the $7M will go towards building a parallel infrastructure is not an accurate view of the strategy. This company is setting up the infrastructure to leverage the vast investments in warehousing that already exist all over the US. Definitely recommend reading the article, it does a solid job of summing the mission up :)
habbott 8y ago
Two things a) I dont think this is competing with Amazon infrastructure. Outside of Amazon, this is a very large industry and very broken which needs to be fixed. b) I agree with you 7M is not going to be enough to fix this industry; its complex and moves physical things (way harder than moving bits) but you gotta start somewhere.

throwawaylalala 8y ago

I’m am ecommerce seller; why Deliverr inatead of Shipmonk, Shipbob, Easy Post? Do you have clear and transparent pricing?

habbott 8y ago
Absolutely the pricing is per unit per SKU - all inclusive of receive, shipping, box and pick pack. I think you will find pricing to be at least 30% lower. You can check out pricing for your items here - https://deliverr.com/fulfillment-cost/ https://deliverr.com/fulfillment-cost/ However the bigger reason for our existence is faster shipping. You can now affordably do 2 day shipping on Walmart and Guaranteed Delivery on eBay and offer 2 day shipping on your Shopify store. You can see here the sales boost we are seeing with fast 2 day shipping -- https://deliverr.com/walmart/ https://deliverr.com/walmart/
tcho 8y ago
Here’s one reason: Deliverr’s cheaper.

bvssatish 8y ago

We use "AWS" :)

arosier 8y ago

I was interested, so I dug a little. Here is my conclusion: While Amazon continues to lower the cost of fulfillment through management and the development of new technology that is driving operational efficiencies, Deliverr tries to lower fulfillment cost by gaining access to excess warehouse capacity for pennies on the dollar. The below pricing shows that Deliverr is able to drive value by offering competitive pricing on the fastest shipping times over other third party logistics providers (3PL). They claim they are able to achieve this cost savings through their "machine learning and predictive intelligence" which they use to determine which of its warehouses to store its client’s goods. However, they go on to say they typically only store the good's in 3-5 warehouses. This means any 3PL should be able to compete on pricing for "2 days shipping" by having 3-5 properly placed warehouses. It seems the key cost saver for Deliverr is their outsourcing of the fulfillment to the excess capacity of the third party fulfillment centers. Using a similar model as Uber. According to this article that states the amount of warehouse space that goes unused on any given day is 4 billion square feet, or roughly 30 percent of total warehousing: https://www.pymnts.com/matchmakers/2017/warehouse-space-matches-customers-with-unused-storage-spaces/ https://www.pymnts.com/matchmakers/2017/warehouse-space-matc.... If deliver is able to unlock only 1.7% of this space for pennies on the dollar, they will achieve FBA warehousing scale (77 million square feet: https://archpaper.com/2017/08/architecture-fulfillment-centers/ https://archpaper.com/2017/08/architecture-fulfillment-cente...) and FBA pricing. In determining if they will be able to gain access to the 1.7% of excess warehousing and maintain SLA's, it is interesting to see what the current warehousing market is in the US. According to this report: https://www.logisticsmgmt.com/article/cbre_research_shows_that_many_u.s._warehouses_are_under_equipped_to_meet_e https://www.logisticsmgmt.com/article/cbre_research_shows_th..., it seems the majority of this excess warehouse space is most likely not well suited to efficiently deliver on the type of fulfillment Deliverr is advertising. "In data analysis for 56 major U.S. markets, a key finding from CBRE showed that the majority of facilities built before the mid-2000s have certain limitations that hinder e-commerce distribution usage, including low ceilings, small footprints, uneven floors, and inadequate docking." The article goes on to mention that only 11% of total warehousing in the US (1 billion square-feet) was built within the past 10 years. It does not mention how much of this space is not being occupied on a daily basis. It would seem Deliverr will need to access about 7% of this warehousing, at a fraction of it's 3PL rate, to reach FBA scale. Unlike Uber drivers, let's hope Deliverr's fulfillment partners are pricing their excess capacity appropriately so as to be able to afford to pay their employees a living wage. Deliverr pricing example for an iMac: https://deliverr.com/fulfillment-cost/B071G2S8LZ/apple-imac-mne92lla-27 https://deliverr.com/fulfillment-cost/B071G2S8LZ/apple-imac-... Amazon Multi-channel: Standard: $29.07 3 Day: $30.07 2 Day: $30.07 Deliverr: Standard: $26.73 3 Day: $29.70 2 Day: $29.86 Typical 3PL: Standard: $19.74 3 Day: $83.29 2 Day: $83.29