Shopify and Flexport team up to launch a one-stop logistics and transportation solution!

It is learned that according to foreign media reports, in order to compete with Amazon, Shopify is expanding its logistics and delivery capabilities. Recently, Shopify has reached a cooperation with Flexport, a global leader in supply chain technology.

It is reported that through this cooperation, the Flexport application will be listed on the Shopify app store, providing small businesses with a one-stop comprehensive solution to meet their global trade needs.

After the Flexport App is launched, merchants can directly quote, book, track, and ship products to the United States. Merchants can also seamlessly integrate product libraries in their own Shopify stores, obtain SKU-level in-transit inventory visualization, and select the best shipping solutions for their business development, including LCL and FCL services, as well as smooth customs clearance and enhanced cargo protection services. Merchants can also grasp cost estimates in real time and use enterprise-level reporting and analysis capabilities to remove common obstacles in freight forwarding.

It is learned that Shopify has been continuously improving its logistics and delivery capabilities. In September 2019, it acquired warehouse automation company 6 River Systems for US$450 million; in May 2022, it acquired transportation service provider Deliverr for US$2.1 billion; last year, it also invested an undisclosed amount in Flexport.

After two years of a pandemic-driven e-commerce boom, the online share has fallen from nearly 60% to around 14% of the retail market. Many retail companies are considering cost-cutting options to adjust online sales strategies that were developed when e-commerce was booming.

According to The Wall Street Journal, having the ability to manage goods from overseas factories has become a top priority for logistics providers operating through e-commerce platforms.

Shopify Logistics CEO Aaron Brown said Shopify is expanding the functionality of its e-commerce platform to "level the playing field" for small retailers, including startups.

“Arguably the biggest challenge is logistics and delivery,” said Aaron Brown. “If we can level the playing field for any merchant — including new merchants — to get the same benefits as large retailers before they make their first sale.”

Notably, Amazon has not offered discounts to sellers who use its logistics services, but has instead increased fees as it faces slowing sales growth, rising costs and an overexpanded logistics network.

In 2022, Amazon's average fee for each sale exceeded 50% for the first time, according to research from Marketplace Pulse, as the e-commerce giant is squeezing more money from the nearly 2 million small businesses that sell products on its online marketplace.

It is learned that as Shopify strengthens its service capabilities for merchants on its digital platform, some physical retailers, including specialty clothing makers Gap Inc. and American Eagle Outfitters, are challenging Amazon's dominance in physical logistics by reconfiguring their distribution centers and warehouses.

Editor ✎ Nicole/

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