Inventory management can be a bear for ecommerce brands of all sizes, especially in recent months. Whether you’re simply trying to figure out a dual fulfillment plan for Amazon, or you’re trying to coordinate your inventory and supply chain across many marketplaces, there are challenges! George Wojciechowski, Co-Founder of ShipBob, joined me to share pro tips to get you on the right track to profitability and efficiency.
Here’s what we covered:
- What you’re doing right and wrong right now, no matter how much volume you do
- Challenges and opportunities around dual fulfillment on Amazon
- What you need to know about multi-channel marketplace fulfillment (and how easy it can be)
- How to figure out the best choices for your brand across packaging, prepping and shipping
Watch the replay
Read the full transcript
Liz Downing (00:02):
Happy Webinar Tuesday, everybody. It’s Liz from Teikametrics, and I’ve got my friend George Wojciechowski, Co-Founder of ShipBob here. Say hi, George.
George Wojciechowski (00:11):
Hi, everybody.
Liz Downing (00:14):
George is here to talk to us about smart inventory management to give you some advanced tips on inventory management in crazy times because we’re still in crazy times. We decided to forgo a slide deck. We want this to be very interactive. A couple of housekeeping things first, the session is being recorded. If you registered, you will be getting a recording in your email. That’s always a big question that people have. Second, we are open to questions throughout the duration of this webinar. Today we should run about 50 to 55 minutes.
Liz Downing (00:46):
There will be a Q&A section at the end if needed, but we would love for you to submit your questions during our conversation so that we can hit them at the most relevant times, and then if you have follow-up questions, we can hit those too. We’re all about making this more of a conversation rather than two talking heads talking at you. Without further ado, George, why don’t you start by telling us a little bit about ShipBob and why ShipBob exists and what ShipBob does.
George Wojciechowski (01:16):
Yeah. Thank you, Liz. It’s really a pleasure to be on this webinar with you. Teikametrics is one of the most formidable names in ecommerce when it comes to agency analytics and tools and reach, and we’re just really excited to be partnered with Teikametrics, and I’m very happy to participate in this webinar with you. Yeah, the story of ShipBob goes back to 2014. We came out of Y Combinator that summer, summer of 2014. The goal of the company has always been to give the new generation of ecommerce merchants the same tools, reach and scalability as the biggest players in ecommerce.
George Wojciechowski (01:55):
All of us on this call know that forever when you’ve ordered a product from Amazon or Nordstrom or Dick’s Sporting Goods, that product arrives within a couple of days, maybe one or two days. Shipping is usually free or some nominal amount. Well, the problem that a lot of ecommerce merchants face is that they’re small to mid-sized businesses shipping from one location to all over the country and all over the globe. They don’t have that same scalability or at least economics to scale similar to how the bigger players in ecommerce operate. But they’re still serving the same customers. Customer expectations are how the major brands are fulfilling their product.
George Wojciechowski (02:38):
But if you’re selling handbags on the lower East side of Manhattan, or you have a cosmetics company in Los Angeles, you’re selling to the same customers, but your fulfillment is taking three, four, five, six days to get there, and the economics of it aren’t very scalable because you’re paying a lot of money on a per order basis. That was a little bit long-winded. We set ShipBob up to level the playing field. We are well-known for having the best tech in the 3PL business, which allows our merchants to integrate with over 33, 34 now, different platforms and technologies that the modern ecommerce business owner would need to operate their business successfully.
George Wojciechowski (03:19):
We’ve also built out a network of fulfillment centers around the United States, North America and Europe. As a matter of fact, we just opened our UK location today. Today’s the official launch of our first location in the United Kingdom, and our second location in Europe. Why that’s important is because it allows our merchants to have that same infrastructure that a major retailer would utilize to fulfill their products. Any client of ours, no matter where they’re based, can access one or all or any selection of our fulfillment centers to distribute their inventory around the United States, Canada or Europe.
George Wojciechowski (03:59):
That allows them to place their products close to where their merchants are, thus allowing them to get the product into their customer’s hands within one or two day shipping, and just as importantly as a competitive and strategic advantage over your competitors when on a per order basis, you’re paying less to deliver that product for the transport of the product than if you were shipping from one location to all over the United States. Many of you know there’s eight shipping zones across the United States. If you can consistently hit zone one and zone two, to get the products to your customers, you’re saving 20%, 30%, 40% on a per order basis. ShipBob at this point works with about 6,000 ecommerce merchants from all over the world, utilizing our fulfillment infrastructure to deliver their products into their customer’s hands.
Liz Downing (04:53):
That’s awesome, and a great comprehensive explanation. What’s cool I think is that I think that your customers on the gamut between people who are multi-channel, they’re rocking and rolling on QVC, they’re rocking and rolling on Etsy, they’re on Amazon, they’re on Target, they’re on Walmart, they’re wherever, and this is … Utilizing your services is a great way to do their drop shipping [inaudible 00:05:17] for certain channels, but then also do their fulfillment into an FBA warehouse, for instance. Your tech is smarter enough to help them know per SKU exactly what they should be doing in order to optimize their inventory.
George Wojciechowski (05:34):
Yeah. On a per SKU basis with the same inventory spread out among all those different channels. Essentially, everything that we built technology wise in ShipBob was not necessarily because we saw, we anticipated what the customer was going to need. It was more that merchants have been telling us, “It would be really cool if you guys were able to build this or build that.” It became very clear a few years ago that merchants didn’t want to have to fulfill to multiple marketplaces in multiple channels from different fulfillment centers and different warehouses and different technologies. To create a ecosystem that allows you to house your inventory with one and only company, like ShipBob, and fulfill all your channel orders and your DTC orders from one place and have that fully integrated and have that data centralized is a key to delivering an awesome experience for merchants.
Liz Downing (06:32):
That’s awesome. I like to talk a lot about inefficiencies when it comes to inventory, because it seems to me that across the board, no matter what level of ecommerce merchant you are, whether you’re a straight Amazon, whether you’re just a couple channels, whether you’re Amazon but you’re international, there are inefficiencies in your supply chain and in your inventory processes that no matter how much volume you’re doing, you could always do better. What are some of the biggest mistakes that you see? You can hit those different verticals, if you want to. You can hit the different … The multi-channel folks are making this mistake, or just amazon-fba, dot com are making this mistake and you can break it down like that. Or if you know of general just inefficiencies and mistakes that people are making with their inventory management, I’d love to hear about it.
George Wojciechowski (07:29):
Yeah, that’s a great question, Liz. There are a bunch of different micro things that I can outline, but the first macro thing that comes to mind is forecasting. You need to be able to correctly forecast how much you’re going to sell and get as close to that as possible, or you’re going to find yourself in a position where you’re overselling your product, you’re out of stock, and you have a bunch of customers who enthusiastically jumped on a certain marketing initiative that you pushed out, and now are left wondering if they bought a scam, because now it says two to five weeks or two to six weeks of delivery. Our customers are very finicky in that sense. So being able to deliver the …
George Wojciechowski (08:14):
Also, when we are buying online, a lot of the customers that we have have products that people see themselves in, they’re really excited when they click that buy button, and literally cannot wait for that product to arrive at their door. So you risk spoiling the relationship you have with that customer if you’re not able to deliver that product within a reasonable amount of time. I would say forecasting is the big macro thing, really anticipating how much inventory you’re going to need, what the sales are going to be, and getting as close to that as possible. On that note as well, another macro thing that stands out to me is that oftentimes merchants don’t know how much leverage they have with their manufacturer.
George Wojciechowski (08:58):
I think manufacturers oftentimes are bullying merchants and saying, “Hey, well, we can’t do this, or we can’t do that, or this is just the way we do things.” They’re a business just like you are, and don’t be afraid to really understand the context of your leverage with them and to work with them in a productive way to make sure that the needs of your demand are being met. One of the things that happens with us oftentimes is that merchants will have inventory sent from their manufacturer to one of our fulfillment centers, and these are businesses that are doing millions of dollars per year but the inventory shows up and it’s not prepped correctly, it’s not labeled. It’s basically just sent on a bunch of skids and a bunch of pellets.
George Wojciechowski (09:49):
The merchant pays the price for that, because if we can receive it correctly, the extra hours and time it’s going to take to get that inventory sorted out is not what we’re going to pay for, it’s what the merchant is going to pay for. Both in terms of producing your product and prepping your product, you need to have a productive relationship with your manufacturer and know that you have leverage with them and do not let them bully you. [crosstalk 00:10:14]
Liz Downing (10:13):
That’s great advice too.
George Wojciechowski (10:16):
Yeah, [crosstalk 00:10:16]
Liz Downing (10:16):
Let’s go back to forecasting because I feel like … I mean, these are both great points, but obviously your relationship with your manufacturer is like a … you have that conversation, right? If it’s still not where you needed to be, then maybe you pivot and you make other decisions. But how do you properly forecast, especially … How do you properly forecast if you’re just selling on Amazon, and then how do you properly forecast when you’re selling on a bunch of different channels at the same time?
George Wojciechowski (10:51):
Yeah. Data. One of the things that we built out that’s an important component of our value proposition on our dashboard is access to your data and tools that allow you to mine that data and locate trends and velocity that helps you make those decisions. That being there already, there are a lot of tools, and I know Teikametrics probably works with some of these companies as well. There are companies, if it’s all right saying inventory planner that are built to help you with the forecasting of your inventory and the velocity of your sales.
George Wojciechowski (11:29):
So really embracing the data that your company is producing and either digging into that yourself and taking it very seriously, or buying a software or a service that handles that for you, but have … Going into it blindly is the most dangerous thing you can do. More often than not, you’re going to end up with the short end of the stick. Utilizing either, like ShipBob tool or a partner’s tool, is going to be super important. I think that’s the right way to go.
Liz Downing (12:07):
That brings me to two questions, but first I want to make a comment too, which is that when you stock out, obviously the worst thing about that is that you’re disappointing your potential customer. But if you’re an Amazon seller, you’re also throttling yourself in terms of your potential earning, like next quarter, because Amazon has implemented the inventory performance index score, which before that there wasn’t any kind of a metric that had consequences. Now there are consequences associated with stocking out, being overstocked. You just need to have the right amount of … the right balance. So you have to have a really smart inventory management strategy. George is right. Does ShipBob integrate with any of the softwares out there that work specifically with inventory management?
George Wojciechowski (13:08):
Yeah. Let me just say, Liz, going back a couple seconds, that that’s a very good point. If you are not correctly working with Amazon or you’re running out of stock or even if you’re sending them inventory incorrectly, it’s fairly punitive on their end for a business. If you talk about like breaking velocity and breaking momentum, that’s something that can certainly break it up if you fall into one of the categories in their doghouse. Very good point. It’s an awful way to break your rhythm and your momentum if your business is doing really well.
Liz Downing (13:44):
Well, and with Amazon, if you are below the threshold for the inventory performance index score, then you get, first of all, more fees and you get limited storage space at FBA centers the next quarter. There are enough disadvantages and tough things to figure out than to just actually cut off at the knees like that.
George Wojciechowski (14:13):
Yeah. [crosstalk 00:14:14] One other thing that I’ll mention, Liz, as we’re talking about data and forecasting, it’s different for every merchant. But one of the tools that we’ve made public, and we actually did this during the beginning of Covid almost a year ago, is that we wanted to give our merchants as much data as possible to help them make the best decisions for their business. There’s two sites, actually three sites, that I want to call out that are public data that you can go to. They’re basically ShipBob taking the entire mix of our 6,000 clients and publishing those results publicly. You can go to data.shipbob.com, or trends.shipbob.com.
George Wojciechowski (14:53):
Data provides you deep analytics on the types of velocity on uncertain goods and whatnot, and it really goes into very granular detail in a lot of interesting topics. Then trends.shipbob.com is all about what types of products are selling. It was really traumatic when Covid first started where we saw the usual catalyst like cosmetics and nutritional equipment just fall off the wayside and things like baby formula jump 800%. Now that’s evened out a bit. But merchants keeping on top of that data and deciding, “Okay, I’m going to be releasing a skew in about two months, and here’s what the data looks like for the similar products,” all that can factor into making decisions about your inventory planning. I just wanted to mention that because those are two public tools that you don’t even need to be a customer of ShipBob to to utilize.
Liz Downing (15:48):
I did pop that in the chat for all of you that are here live, and if you’re watching a recording of this, if you’re watching the recap on our site, those links are in the recap that I always prepare after one of these webinars. Enjoy, because those are two great resources.
George Wojciechowski (16:02):
Yup. To answer your original question, Liz, yes, we do integrate with platforms like Inventory Planner, Skubana, Cin7 different platforms that allow you to help forecast your inventory. [crosstalk 00:16:15]
Liz Downing (16:15):
Okay, great. Is a list of those potential integrations on your website?
George Wojciechowski (16:20):
Yes, they are on our partner’s page. I believe it’s shipbob.com/partners, but I’ll have to confirm that and I’ll drop it in the box by the end of the conversation.
Liz Downing (16:31):
Okay, great. [crosstalk 00:16:32] Because we did have a question about what apps you recommend for inventory management. I think you could probably check out George’s partners page, and depending on what we know, how diverse your ecommerce platforms are, or if you need one that just focuses on one particular platform, you’ll probably find the gamut there. If you’re just focusing on Amazon FBA, I recommend RestockPro personally. But if you’re a multi-channel, then George can help you out with finding a good resource. We do have a couple of questions about ShipBob functionality, so let’s go ahead and do those, if that’s okay.
George Wojciechowski (17:06):
Of course.
Liz Downing (17:11):
Does your program work with QuickBooks?
George Wojciechowski (17:14):
Yes. We have an integration, a long-standing integration with QuickBooks. I will say that it is not as dynamic as we would eventually like it to be, and we are having conversations with QuickBooks about an enhanced integration. Right now there is an integration where you do export your invoices and different data points around your billing, with ShipBob into QuickBooks. But I would also say stay tuned to Q2 or Q3 this year, in which I fully expect an enhanced integration. That’s a lot more dynamic.
Liz Downing (17:54):
Right on. We have a fan that uses ShipBob to warehouse our product and refill our FBA inventory when needed. We love that ShipBob offers this, especially since they started limiting the inventory we could have at FBA warehouses. Last I saw, ShipBob wasn’t taking advantage of the Amazon Marketplace Web Service, MWS, to automate inbound shipments to FBA. Are there plans to integrate that way in the near future?
George Wojciechowski (18:19):
Yeah, we’re taking a really close look at that. Again, as this client pointed out for all of us, it’s something that’s desired. When something is desired by our merchants and we hear it from enough merchants, we’re a tech-first company and we probably have more engineers than any fulfillment company on the planet, I would say, other than Amazon, of course. If we hear it enough from enough merchants, we will find a way to build it because we want our merchants to stick with us forever, for the longterm, and if we’re not able to fulfill a need and that is a lingering problem, we fully expect merchants to find that solution somewhere else.
George Wojciechowski (19:04):
Thank you for pointing that out. It’s something that we’re always taking a look at and we are looking for how to make the experience for our merchants who are predominantly D2C in terms of where they’re selling their product. More robust on the Amazon platform specifically when it comes to prime and merchant fulfilled prime and things like that.
Liz Downing (19:27):
Sure. Great. That’s a great explanation. Let’s talk a little bit about dual fulfillment because that attendee brought up getting limited by Amazon. Like during Covid, obviously, there was a need for essential items. So a lot of merchants were told, “Hey, you can only send this many,” or, “Hey, you can’t send that at all.” A lot of Amazon sellers had to pivot to a dual fulfillment model. Talk me through that a little bit. I know that I’ve talked to a lot of brands and sellers that have done that. But talk to me a little bit, from a year ago today, how many more people are, just talking about Amazon itself, doing that merchant fulfilled option as well as FBA, and what trends are you seeing in terms of that?
George Wojciechowski (20:18):
Yeah. Actually, I was having a conversation with a counterpart a couple of days ago on this topic, or maybe it was yesterday, a couple of days ago, a Sunday. But we are seeing more merchants take on merchant fulfilled versus FBA, and there’s probably a couple of reasons for that, which I can outline, but it is something that in over the last few months, especially since October or September of last year, more merchants are deciding to move away from FBA and do it themselves. There’s a lot of reasons for that. One of the things that I mentioned a few minutes ago is that, hey, when you get it incorrect when you’re shipping to FBA, they’re going to send it right back and everything that you paid for, freight charges and missed opportunity in terms of giving them inventory and having them list that product, are going to now double.
George Wojciechowski (21:15):
You’re going to have to do it again. That’s annoying, and then for a lot of businesses that could be crippling, at least temporarily. Another thing is that when you’re with FBA, I’ve noticed that … I’ve talked to a couple of merchants and they’ve mentioned that they get pressured to be listed in the Amazon Marketplace, which is great. Amazon is the most powerful platform in a lot of ways on the planet, and you’re amplifying the amount of eyeballs on your product times a large amount. But if you’re listing your product with them and essentially your product is also taking your customers to your competitors products. If you list the product in the marketplace, your customer is also going to see a half dozen of your competitors products and be like, “Oh, this is cool too.”
George Wojciechowski (22:07):
It’s not as much of a captive audience as it is when somebody is going directly to your website. Some merchants are seeing that as like, “Hey, I don’t want to compete. I don’t want my product to be a commodity or looked at as a commodity. I want to be seen as this unique brand that merchants have an active interest in versus just a passive commodity.”
Liz Downing (22:32):
Well, and you can manage some of that competitive intel with smart advertising, with smart research, all that kind of stuff. I don’t know a whole lot of brands that don’t want to take advantage of the Amazon Marketplace, just in terms of the volume that you can do. But it’s a whole lot of ifs, right? If you’ve got your listing optimized, if you’ve got the best product photos, if you’ve got your bullets optimized, if you’ve got your backend keywords in place, if you’re running the right advertising campaigns, and that’s if you’re getting the Buy Box often enough, and there’s a lot of that.
Liz Downing (23:12):
I can imagine that there might be a world where we’ve got merchants that say, “You know what? No, I’m just going to do it myself.” But I think that right now, still Amazon’s so huge that most people are willing to pay to play there. But they’ve had to make this pivot. I mean, I know a ton of brands that were doing dual fulfillment for a long time. They were doing merchant fulfilled, they were doing FBA because maybe they’ve got an item that got an expiration date, or maybe there’s some reason for that. But-
George Wojciechowski (23:50):
Or that one or two SKUs just have amazing velocity, and maybe you won’t house the other seven SKUs that you have with FBA, but the one or two SKUs that you know are just consistently being sold, yeah, let’s send that to Amazon. That’s a [crosstalk 00:24:07]
Liz Downing (24:08):
One of my very favorite merchants that I’ve ever worked with did merchant fulfilled, everything except for one item. He had one item that he would do FBA, but it was also for packaging reasons, right? Because he was a very niche brand and because he wanted it packaged a certain way with a certain type of tissue paper, and you don’t get Amazon to do that necessarily to your specifications. He just didn’t want his product thrown into a box with a power cord and a pacifier, and somebody’s foot itch cream or something. He wanted his products to be special, so he did Fulfilled by Merchant for almost everything.
George Wojciechowski (24:57):
Yeah, and that’s what you give up. You make a very good point, Liz. These Amazon or marketplaces, you’re giving up your ability to create a branding for at least that sale, which in this new world where D2C ecommerce is taking over traditional retail, is going to be more important than ever before. Your ability to create an unboxing experience or to put marketing or a deal for a followup sale is something that you give up when you’re with FBA or you’re with certain services on different channels, and that’s really critical to a lot of businesses building a following that not only buys their product consistently, but tells other people that buy their product too.
George Wojciechowski (25:48):
How often have you seen somebody post on Instagram or any of the social channels be like, “Cool. I bought this awesome product on Amazon. Go out and buy it yourself?” No, it’s usually, “Hey, I just saw this cool website. They’re making these … It’s a streetwear company from Silver Lake in Los Angeles. It’s so cool. I love this brand. Check it out. This is what I’m about.” You don’t get that ability to create that sense of enthusiasm and that experience when you’re selling through the marketplace.
Liz Downing (26:17):
I am seeing though, in the influencer space, more people saying and you can buy it on Amazon, because I feel like there are people educating in the Amazon seller space about, “Okay, here’s how you use micro influencers.” I know that I have a webinar coming up in not too long about outside of the box ways to advertise your brand, that you’re selling on Amazon, but to still differentiate your brand in a way that would be attractive to a micro influencer. It would have the potential to go viral. But again, I don’t think that it could be at all about the packaging, right? Because unless you package your package exactly the way you want it, and then you put it in another box, and then that’s how you send it into FBA, you don’t have a whole lot of control over the presentation. There are always pros and cons with anything, and that’s one of the cons with FBA, and that’s why my friend in New York did his merchant fulfilling so that he could package it exactly the way he wanted someone to open it.
George Wojciechowski (27:21):
That, and I will also outline lists. I want to stress the importance of this, is that you’re also giving up that email address. You can have thousands of people buying your product, but never be able to communicate with them ever again. Because when you’re doing it on Amazon, like you pointed out, at boxes Amazon, it’s coming with foot cream and your new electric toothbrush. It’s like it’s not really this unique, “Oh, cool. This package with this cool box is at my doorstep. I can’t wait to open it. They always have something great in there for me, and it’s so cool and I love the branding.” But that email address is super important. If you’re not able to retain who’s buying your product and communicate them in the future, your ability to create repeat sales is then somewhat decreased [inaudible 00:28:08]
Liz Downing (28:08):
Unless you’re dealing with diehard Amazon shoppers that are like, “I’m not going to go buy it off your website. I’m going to … If it’s not on Amazon, I’m not buying it,” and I know that there are plenty of those people out there. I’m not one of them. I really like to buy off of people’s websites. I feel like somebody keeps going off of mute, but I don’t know how that’s possible. We had another question about ShipBob. Do you plan to offer temperature control anytime in the future or do some of your warehouses?
George Wojciechowski (28:37):
Yeah, that’s a great question. A couple of our warehouses are already temperature controlled to a certain extent. I think we’re at three or four, and that’s part of our ShipBob fulfillment network, which spans over 14 fulfillment centers throughout the United States. If somebody is looking for temperature control, you can email me directly George@shipbob.com. I’d be happy to point you in the direction of which of our fulfillment centers already have temperature control. Again, when we started out, I personally opened ShipBob’s first four fulfillment centers in Brooklyn, Los Angeles, San Francisco, and Dallas. I remember back in 2016, 2017, 2015, sweating like I’ve never swept before just in a normal course of the day because it would get hot.
George Wojciechowski (29:29):
Fulfillment centers are these big humid spaces and it was awful. We’ve moved away from that. All of our fulfillment centers are according to regulation at the very least, and the need for merchants to have temperature control is now more important than ever before, especially with one of our biggest verticals being cosmetics. You can’t have that. All of our fulfillment centers have some semblance of temperature control and some of them have the official temperature control that you need. I think it’s between 75 or 74 degrees or something like that, and we can guarantee that 24 hours a day, year round. Shoot me an email directly, and I’ll point you in that direction.
Liz Downing (30:13):
I’m going to pop your email into the chat. Someone’s also asking if you integrate with ShipStation.
George Wojciechowski (30:20):
Yes. Yeah. ShipStation is one of our oldest integrations. They’re a great company. Obviously ShipStation’s owned by Stamps.com and they have a lot of different subsidiaries that do a lot of the same things. It’s a natural progression for a lot of merchants. I would say to start with ShipStation. Starting out and you’re doing 10 orders a week or 25 orders a week, you’re not going to use a ShipBob because you could do the fulfillment yourself and save a lot of money on warehousing costs and shipping costs and you don’t have the scalability yet to actually be working with a company that you’re outsourcing your fulfillment to.
George Wojciechowski (31:02):
A lot of what we’ve seen over the years is that a lot of merchants start off on platforms like ShipStation, print out their own labels, get to a point where they’re doing 75, 100, 150 orders, and they’re like, “Hey, I’m spending too much time packaging my products. I know how the fulfillment works. I could easily communicate that to a partner who’s now going to take over this and do it exactly how I want it to be done, how I need it to be done,” and they move off ShipStation and we’re in start with a platform like ShipBob.
Liz Downing (31:34):
All right. That makes a lot of sense. Let’s talk a little bit about when you were talking about dealing with your manufacturer earlier, you said something about the way your product was prepped, the way your product was packaged. Let’s talk a little bit about packaging, prepping and shipping, and what you actually need from the manufacturer in order to get things done efficiently at ShipBob, but also any really great solutions that you’ve seen lately that just impressed you and things that you think are contributing to people’s success in terms of the way their products are packaged.
George Wojciechowski (32:18):
Yeah. A lot of things. First thing that comes to mind, Liz, is dimensional weight is a problem for everybody. When you’re creating your product, when you’re evolving your product that already exists, really take a look at what the dimensional weight is of your product and how that could perhaps be improved upon to lower the costs on a per shipment basis. I’ve had companies really change the whole game for their business by just finding a new box or a new way to package their products. I’ve even had companies that have created tools that like, hey, say this is their product, and they figured out if they trim a couple centimeters off the product that it’ll save them an average of $2 and 30 cents per shipment.
George Wojciechowski (33:07):
So really understand dimensional weight and how that affects your product, and look at the different variables when it comes to how it’s being packaged how, how big the product is, and that can really make a big difference in terms of your average cost to get an order out the door. That comes to mind. I would also say that creating an unboxing experience. Really have a vision for what you’re trying to communicate to customers, and then find that audience and market to them. But if you just have a product that is cool, sometimes that’s not enough.
George Wojciechowski (33:50):
You need a product that’s cool, but also a certain type of branding that an audience will see a part of themselves in or maybe who they aspire to be in. But you nowadays, to really stand out from the crowd, just having a cool product isn’t enough. You need a cool product with a message, and a message that people can resonate with, or at least certain subsets section of the population or an audience that is going to be able to see themselves in.
Liz Downing (34:17):
I am personally a big sucker for packaging. If the packaging is stellar, then a lot of times I will be fooled in thinking the product is better than it really is because the packaging was so good. I can be fooled that way. I do eventually catch on, but I get dazzled by fantastic packaging. Especially these days it’s very important to use recycled materials and to make sure that the package packaging is recyclable. But to be able to do that in a creative way and then to really cleverly communicate your brand and enforce your brand in your packing, it’s just a great thing. I don’t know. I just think that a lot of companies and a lot of brand owners miss the mark when it comes to the opportunities, even if you’re selling FBA. Even if you’re … Your internal packaging of your product can be awesome. Do you guys give advice on packaging?
George Wojciechowski (35:13):
Yes. I love that you made that point, Liz, and I was going to talk about that as well. Sustainability is now more important than ever to people buying products online and buying into brands. I know, and we’ve all had this experience, and I occasionally I do order something from Amazon because the convenience is outstanding. But my heart sometimes sinks when I get something as simple as a bottle of vitamins from Amazon, and it comes in a box that’s this big, and it’s got a bunch of the bubble wrap in there. I’m like, “My God! This whole box just to get shipped to my door, and now I’m going to collapse it and throw it into recycling bin. That was a huge waste.” I’m sure I’m not the only person that feels that way, and I’m sure tens of millions and hundreds of millions of people feel the same way.
George Wojciechowski (36:06):
Sustainability is super important nowadays. We have a fantastic partner called Packlane and another one called Arka that both takes … that are able to help our ecommerce merchants with sustainable packaging. Not only do they do fantastic design, but they are able to source sustainable packaging materials. I know in our fulfillment centers, not everything can be 100% sustainable, but we’re constantly looking to improve efficiency in that regard when it comes to recyclable bubble wrap or substituting something with another type of product. We are doing that, and we’re continuing to find out other ways we can do it. I will also … I don’t know how many people, I don’t know if you’ve heard of them this, but there’s a great company out in San Francisco called Pachamama.
Liz Downing (36:58):
Great name.
George Wojciechowski (36:58):
Great name. Actually, I think it’s actually a thing. Pachamama, somewhere like in the Amazon rainforest. But what they’ve done is they … Not only companies like ShipBob can neutralize their carbon footprint based on the algorithm that allows you to calculate what your carbon footprint is. But we built an integration into Pachamama that allows our merchants to do the same thing. When you put that on your website and say, “Hey, we’re a carbon neutral ecommerce company. Yes, we produce these products. Yes, we ship these products, but we also offset it with the carbon offset or buying carbon credits that offset what we’re putting out there.” I’m a huge fan of that, and I led that relationship early on and our product team ran with it and embraced it, and now we’ll have built out an integration that our merchants are using and also advertising to their customer base saying, “Hey, we are carbon neutral,” and it’s a great thing.
George Wojciechowski (38:02):
I can drop Pachamama into the chat. But one of the great things that they do differently than how it’s been done prior to this is that before you would go and tell somebody somewhere in the world, “Hey, don’t cut down this certain section of the forest,” and they would take your money and they would cut the trees down anyway. Pachamama utilizes cheap gas technology, satellite technology, and drones to confirm that the offset that you’re purchasing is actually being implemented in the real world, which I love.
Liz Downing (38:33):
Yeah. That’s amazing. Yeah, if you would pop that into the chat, that would be great.
George Wojciechowski (38:39):
I’m not the best speller in the world, but I will pop this in the chat.
Liz Downing (38:41):
You can check it out of your browser first. This is probably something you can answer while multitasking, but someone has asked how does ShipBob show us our inventory levels?
George Wojciechowski (38:56):
It’s in real time on our dashboard. I’d be happy to give anybody, again, a demo of our platform. But when you go into the ShipBob dashboard, we are showing your inventory in real time in each of our locations, how much you’re stocking, and you get automatic reorder for inventory when inventory drops down below a certain level. In addition to that, you can see where orders that have already been shipped out the door are in real time. Each order, once it gets fulfilled, has a hyperlink with the tracking number that you can click on.
George Wojciechowski (39:31):
When something happens, maybe there’s a delay because of the weather or a package is lost, you get that email that says, “Hey, there’s a problem with this package going to Chicago. It’s stuck in Gary, Indiana and here are the reasons why.” It’s very dynamic in terms of reporting on what your inventory levels are, and that’s spread out among all the locations where you have inventory. But also once it’s shipped, there’s a lot of information as to where that order is and if there’s any problems with it.
Liz Downing (40:00):
That’s super cool. What do you think the hottest channels are right now? New channels? We’ve got our Amazon people. A lot of people started on eBay.
George Wojciechowski (40:17):
Yep. [crosstalk 00:40:18]
Liz Downing (40:18):
What are you getting asked about the … What is it? Is it international Amazon Marketplaces? New Amazon international marketplaces? I know Poland just got … Well, that was today, wasn’t it? Is it Poland just went live today?
George Wojciechowski (40:35):
UK. UK.
Liz Downing (40:38):
No. I mean, the UK has been around for a while. But I think the Polish marketplace just opened today on Amazon.
George Wojciechowski (40:43):
For Amazon? I didn’t even know that. That’s super interesting.
Liz Downing (40:46):
Yeah. Yeah. What is the channel that people are asking about the most?
George Wojciechowski (40:54):
Obviously, there’s always questions on Amazon. There is Walmart’s been coming on really strong. People are seeing Walmart, just perhaps a refreshing alternative to Amazon. Facebook, people are excited about what Facebook and Google are going to do with their respective marketplaces, and those are both marketplaces that we already have a very early relationship with. Both of those companies haven’t fully expressed yet what they’re going to be doing with their marketplaces. But you can bet that they see this as an opportunity to help build on the audiences, the tremendous audiences that they’ve created over the years and capitalize on it. I think there’s going to be some exciting things coming out of Google, Facebook, Instagram. Yeah, we get asked about those a lot.
Liz Downing (41:52):
Yeah. I bet. We did too. What kind of action are you seeing on eBay? I’m seeing more and more brands selling on eBay, all of a sudden, that didn’t sell on eBay before. Are you seeing that too?
George Wojciechowski (42:03):
Yeah. I first noticed that two holiday seasons ago. Not 2020, but 2019, that a lot of brands were coming back to eBay and seeing that as a relevant channel for them to sell into. It’s been cool to see that eBay had that a little bit of this Renaissance that they’ve had. But I still don’t know how sustainable it is. I know that they’ve had some turnaround in terms of management there and things like that. But I think it’s a great opportunity in a very natural direction for them to embrace. For us, we’ve always had an eBay integration. It was actually the first integration that we built, eBay and Shopify back in 2014.
George Wojciechowski (42:50):
But yes, eBay is actually … If you’re a brand and you’ve got a lot of different SKUs, it’s a little bit of an undiscovered marketplace if you’re taking a more traditional ecommerce approach versus … Formerly eBay was a big garage sale. But if you actually have a brand and you’re trying to … and you’re listing it in the eBay marketplace, there’s opportunity there because there isn’t that much competition yet.
Liz Downing (43:20):
What I love is that it’s both though. I’ve got a big soft spot for eBay personally. I shop on eBay a lot. I have been known to sell things. I have a whole stack of things to list on eBay right now. I do have a … I like that it can still, because it’s stuff that I like. I’m cleaning out this one room in my house, and I’m like, “Hey, I could probably sell that on eBay.” [crosstalk 00:43:39] It can still be the garage sale, but it’s also a great launch pad for brands or a great expansion channel for brands too. It can be both and it’s letting itself be both, and I love that about it. But that’s just me.
George Wojciechowski (43:52):
Oh, I agree. I agree. I love the novelty of it and I love discovering new brands that are usually priced really well on eBay. The novelty for me, the fact that they’re still holding onto that and then that that is the main part of their business is awesome. Sometimes when I just do lazy internet browsing, it’ll be just find out what cool thing can I find out on eBay.
Liz Downing (44:16):
Yeah. Yeah. My signed William Shatner ephemera and I can also buy things from my favorite brands there. It’s a win-win situation. Back to Amazon, it’s always back to Amazon, we do have-
George Wojciechowski (44:32):
They are the leader, and so all these other channels who are trying to build out marketplaces usually look to what Amazon is doing and are replicating at least a good percentage of how Amazon has set it up. So it’s-
Liz Downing (44:44):
Totally.
George Wojciechowski (44:45):
… [crosstalk 00:44:45] leader.
Liz Downing (44:48):
When somebody is using ShipBob, how do they know how much inventory to send into Amazon? You’re taking care of the FBM orders. Are you grabbing those from Amazon, or are you getting those from your actual merchant? Then in turn for someone selling on FBA, do you tell them how much to send into FBA, or do you do that through an integrated tool?
George Wojciechowski (45:15):
Through an integrated tool. We’re not going to tell you how much to send to FBA. Merchants, again, they’re either sourcing that data and making those decisions on their own, or they’re using a adviser like Channel. Channel.net is a great advisor who’s able to help navigate you on the Amazon Marketplace. Tinuity is out there as well, and that’s not our job. We don’t see ourselves as having a certain expertise in that regard, and so we’ll leave that to the merchant or one of the integrations that we have to help the merchants make that decision.
Liz Downing (45:49):
Well, and if you’re just working with FBA again, I suggest that you check out RestockPro. That’s what … Go to ecomengine.com because it’s not crazy expensive and it’s really good for if you’re at that place where you want to automate just your FBA, you want to know how much to send it into FBA, and you can do your item stickers and your labels and all that kind of stuff. If you want to, or you can just tell ShipBob, “Hey, send this many, because it’s all already there.” But it’s a really good tool for that. Someone else has asked how competitive are ShipBob fulfillment fees compared to Amazon, and I’m imagining that’s if Amazon fulfills your Shopify orders, for instance, what’s the difference in cost of having Amazon fulfill your Shopify orders or having ShipBob fulfill your Shopify orders?
George Wojciechowski (46:42):
Yeah. They’re always comparable. You’ll never find somebody who’s doing fulfillment here and another company that’s doing it way up here. There was always 10%, 20% differential in pricing. We consider ourselves at the mid range of the market. We’re competitively priced but we also know that the fulfillment network and the technology that we offer is formidable. So we’re offering you essentially the same ability to do what Amazon does, but keeping your branding and keeping that relationship with your merchants and making the sales and collecting the email addresses.
George Wojciechowski (47:22):
There’s great value in that if you’re building out a business, being able to execute how Amazon executes their fulfillment, how major, major US retailers and world retailers execute, but with being a fraction of the size that they are. We’ve built out that infrastructure for you to do very similar things, to do the same exact thing. We can’t price ourselves at the very bottom of the barrel of the market. We’re going to be competitively priced, but it’s also going to come with an acknowledgement that we’re allowing you to level up and execute on a strategy that otherwise would require tens of millions or hundreds of millions of dollars to build out.
Liz Downing (48:04):
Do you have predictive inventory for restocking based on sales volume trend?
George Wojciechowski (48:09):
Yes.
Liz Downing (48:10):
So seasonality, all that jazz?
George Wojciechowski (48:13):
Yeah.
Liz Downing (48:13):
Cool.
George Wojciechowski (48:13):
It’s obviously a work in progress-
Liz Downing (48:17):
Sure.
George Wojciechowski (48:17):
… in the sense that there’s a long way to go for not just logistics, but in all aspects of AI to do predictive analytics and to make those … look at the data that exists and make predictive assumptions as to what you should expect. But we deliver that information as best as we can at this point, and we are actively trying and how we can improve on making that even better in the future.
Liz Downing (48:44):
Can a brand ship branded boxes for you to pack their multiple orders in?
George Wojciechowski (48:49):
Yes, absolutely. That’s something that ShipBob’s been behind from day one. We’re a ghost. We want to do the job and get the product into your customer’s hands, but we don’t even want your customer to ever know or care about who ShipBob is. From the very first day we started the company, we’ve been all about expressing yourself through your own branded boxes, through your own inserts, through however you want your vision to be executed. When the customer receives that package on their doorstep and lays it on their kitchen table, we want you to be able to execute that as accurately as you envision it.
Liz Downing (49:22):
When we’re not live in front of more than 100 people, George, I’m going to send you a list or talk to you on the phone and ask you, because I’ve got a high list of 10 brands that I love because of their packaging and I’d love to know if you’re doing that. Because like I said, big sucker for really good packaging. This seems like a plant question, and I’m going to read it in its entirety because it’s beautifully worded and it’s challenging to you, and I think that you’re going to have a good answer for it. At a time when ecommerce velocity has greatly increased over the past year and will continue in the future, what is ShipBob’s strategy for keeping up with improving and growing your service offering at a time of such great velocity? It’s the age old how do you change out the engines on your plane when you’re in the air flying at 400 miles per hour?
George Wojciechowski (50:15):
Fantastic question. Thank you for asking that. We listen to our merchants. We build because merchants tell us what they need, and I think that is the best roadmap as to how to keep up with that velocity and continue to offer a product offering that will be attractive to ecommerce merchants and to have them choose ShipBob as their partner for pick, packing, and shipping their product and getting it into the customer’s hands. Yes, we look to see what everyone else is doing, I guess, to a certain degree, but the number one decider as to what we build in our product offering is because merchants are telling us to build it.
George Wojciechowski (50:58):
If you’re a merchant of ShipBob or if you have ideas and you’re not a merchant of ShipBob, reach out to us and tell us what you think will be cool and what you think you need, because we have over, I think, 65 engineers at this point and are in a pretty robust product team that is literally built on continuing to satisfy our merchants needs. We’d love to hear it, and if we hear it enough, we build it.
Liz Downing (51:25):
That’s awesome. I know that there are people that have questions about what product innovations you’re working on right now. I think that those are probably best questions to ask George by emailing him, George@shipbob.com, because he seems very open to your questions, very open to your suggestions, and very open to building the very best thing to help you scale your business. We do have one tactical question that I want to address, and then I want to give out the relevant information and get everybody along before the top of the hour. If you do have questions, pop them in guys, because we only have about six minutes left. Does your service provide any shipping security? If something is lost in transit or marked as delivered, but the client didn’t get it, what happens for ShipBob?
George Wojciechowski (52:13):
We self-insure up to $100 on all packages, and then we also have partners that you can … You can also choose to buy insurance for higher priced goods. Yes, insurance is something that we’ve always offered up to $100 automatically, and anything over that, you’re available to purchase insurance as well
Liz Downing (52:38):
Rocking. That’s great. Most of your merchants are D2C customer, but can you support B2B? If somebody’s got a B2B order for a wholesaler or for stores, can they attend those orders via ShipBob or do they need an integration for that?
George Wojciechowski (52:56):
Yes. More often than not, absolutely. It’s been really great to see over the years that merchants start off with us and maybe doing 200 orders a month four or five years ago, and now they’re coming to us and say, “Hey, I just won this big contract with Sephora,” and we’re like, “Oh my gosh, you’re really building out an amazing company.” Yeah, D2C is the main focus of ShipBob. But obviously, those D2C merchants are going to have needs to sell to retailers and to sell B2B. More often than not, we’re able to execute it. I think where we do ever run into problems is that when a new merchant comes to us and on day one, they’re like, “80% of my orders are B2B, and then I have about 20% of my volume is D2C, can you still take this on?” We’d love to see that D2C. But for the majority of our merchants that are selling B2B, it’s not a problem for us. We will prep it, we will work with the merchant to make sure that they satisfy the requirements of their B2B partner.
Liz Downing (54:01):
Awesome.
George Wojciechowski (54:02):
[crosstalk 00:54:02] B2B vendor.
Liz Downing (54:05):
Do you integrate with NetSuite?
George Wojciechowski (54:08):
Yes.
Liz Downing (54:09):
Cool. I’m actually going to pop your integrations, your partners page into the chat.
George Wojciechowski (54:14):
Yeah, it’s a work in progress. Again, similar to QuickBooks, it can be done through a third party, like CartRover, with NetSuite. But looking at a deeper integration with NetSuite, a direct integration is something that we’re looking in our product roadmap. As of right now, we don’t have a robust direct integration with NetSuite. However, merchants do integrate between ShipBob and NetSuite via a third party who’s able to bridge that integration.
Liz Downing (54:45):
Now we had a question that I know part of the answer to. If you came late, George was telling us that he just got a 3PL in the UK. Now there are two locations in Europe. What’s the other one?
George Wojciechowski (55:01):
Ireland.
Liz Downing (55:01):
In Ireland. Okay. Sorry?
George Wojciechowski (55:05):
Kilkenny, Ireland. Correct
Liz Downing (55:08):
Where my family’s from.
George Wojciechowski (55:10):
Really?
Liz Downing (55:11):
Yeah.
George Wojciechowski (55:12):
Amazing.
Liz Downing (55:13):
That’s pretty cool. Well, one side of it. But that’s important now, and we didn’t even touch on Brexit, but they’ll have to save that for next time. But what about Canada? You have-
George Wojciechowski (55:29):
Yeah. Yeah, absolutely. We built our first facility outside of the United States was in Ontario, Canada. It’s in Ottawa. We have a phenomenal partner out there. Like a lot of our partners, they’ve been doing fulfillment for 15, 20 years. They know the business really well. Well, what they don’t know … what they are not so great at is resonating with today’s modern ecommerce business. Yes, we do have a partner in Canada, and it was our first location outside of the United States and I’m very, very happy because they’re really great people and really great partners. That location has been doing very well, and a lot of ShipBob merchants have been utilizing it successfully to get their products into Canada and closer to their merchants.
Liz Downing (56:21):
Well, it’s a great central location too. It’s a very strategic location. Well, George, this has been great. You’re just so much fun to talk to. Like every webinar that Teikametrics does, I will be writing a recap of this, I’ll be sending you the recording to your email. If you registered for this, you can watch it on our website, you can watch it on YouTube. You can reach George at George@shipbob.com. He will answer your questions. If you’ve got great ideas about what’s needed to make it to the next level in ecommerce, he’s all ears, as am I. LDowning, D-O-W-N-I-N-G, @teikametrics.com. George, thank you so much for joining me today.
George Wojciechowski (57:02):
You’re welcome, and thank you, guys. It’s been a pleasure.
Liz Downing (57:04):
We’ll see you all next time. Bye.
