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Retailers enlist help of fulfilment providers for faster last-mile delivery

WITH e-commerce showing no signs of slowing, retailers are increasingly looking to fulfilment providers to place inventories in position for faster last-mile services

15 December 2020 - 19:00
WITH e-commerce showing no signs of slowing, retailers are increasingly looking to fulfilment providers to place inventories in position for faster last-mile services.

As consumers continue to show hesitancy to shop in stores amid the Covid-19 pandemic, the emphasis on e-commerce requires positioning inventory closer to the customer in order to shorten the last-mile. As a result, retailers are turning to fulfilment providers with cloud-based technology capabilities to manage their inventories in real-time.



Fulfilment providers provide typical warehousing services such as pick and pack, returns, and inventory management for e-commerce sellers. Third-party logistics providers such as XPO Logistics and Geodis, and small parcel providers such as FedEx and UPS offer fulfilment services, as do a host of smaller tech-focused entrants, reports IHS Media.



'Suppliers that have traditionally only sold to stores are now having to supply stores and also to the retail brand's online store or marketplace,' said Sean Henry, co-founder and CEO of Stord, a technology platform and network for fulfilment and warehousing services.



Still, that comes with challenges. 'FedEx and UPS are faced with volume challenges and are placing limits on some retail customers. How long this lasts is unknown,' Mr Henry said.



He said there was now a trend for retail brands to reposition inventories closer to small parcel terminals and other locations where they can inject parcels into sort centres outside of key markets. Flexibility will be a key trend as the retail industry enters 2021.



As the focal point of e-commerce logistics, the fulfilment market is attracting a number of investors. Stord's latest round of funding of US$31 million brings total investments in the company to $46 million, and its valuation to $200 million. ShipMonk, another fulfillment provider, also announced funding recently of $290 million.



Stord plans to use its fresh funding to expand on its supply chain innovations by building additional solutions that optimise warehousing, fulfillment, and last-mile solutions. It also plans to continue to invest in technology solutions, such as a routing and integration platform.



ShipMonk plans to build out business-to-business (B2B) capabilities and expand within the US, as well as internationally.


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