Giants from all walks of life are racing across borders to cross-border e-commerce logistics, which is an increasingly hot track.

Deliverr to buy logistics service provider for $2.1 billion

Amazon has Amazon Global Logistics, Shopee has Shopee Logistic Service, Alibaba has Cainiao Network…

Recently, Shopify announced that it will acquire Deliverr, an e-commerce fulfillment company headquartered in San Francisco, California, for $2.1 billion in cash and stock .

The deal, the largest acquisition in Shopify's history , will allow the company to create an "end-to-end logistics" service for millions of sellers.

For Shopify, our goal is not only to level the playing field for independent customers, but to make it work in their favor — turning their scale and agility into their superpower.

Together with Deliverr, the Shopify Fulfillment Network will provide millions of growing businesses with a simple, powerful logistics platform that enables them to keep their customers happy time and time again.

After the acquisition is completed, Shopify's logistics and fulfillment capabilities will be greatly improved, and the use of Deliverr's technology can well enhance the ability of Shopify Fulfillment Network (SFN) to manage merchant inventory from port to doorstep.

It is understood that Deliverr, established in 2017, is a logistics network service provider in the United States, serving marketplace sellers on multiple platforms such as Walmart, eBay, Google Shopping and Shopify. After raising $250 million in Series E in November last year, the company The most recent valuation was around $2 billion.

Deliverr combines disparate, independent warehouses using a common software layer, allowing relatively small sellers to take advantage of a nationwide network of warehouses to facilitate faster shipping.

Previously, Deliverr helped merchants on Amazon, eBay and other e-commerce platforms get products to consumers in two days or less.

In addition, Deliverr can predict items that buyers may be interested in, and accordingly locate items in the warehouse network for fast delivery.

Currently, SFN is in the process of merging with Deliverr to remove logistics supply chain complexity for Shopify and non-Shopify merchants.

At the same time, SFN and Deliverr will also launch a new service called Shop Promise, which will provide consumers with "two-day" and "next-day" delivery , as well as more for storage, shipping, inventory preparation and returns Choose to easily fulfill orders on third-party e-commerce platforms and own websites. Delight buyers with fast, reliable, predictable, and affordable order fulfillment.

Overweight logistics services for millions of merchants

The acquisition of Deliverr is undoubtedly an effort by Shopify to achieve its two-day delivery goal, and Deliverr's network can help Shopify achieve and accelerate this goal because Deliverr has always promised customers fast fulfillment timelines.

Similar to Shopify's current fulfillment service, Deliverr allows retailers to ship inventory to a single location, where Deliverr fulfills it across a network of warehouses.

Without Deliverr, it would take years for Shopify to compete with Amazon in logistics, the people said . Despite the "expensive" cost, the deal would be a positive addition to Shopify's goals.

It is reported that Shopify is constantly improving its logistics network. In 2019, Shopify acquired 6 River Systems for $450 million.

6 River Systems is a company that makes fulfillment software and warehouse robots. The company's acquisition enhanced Shopify's fulfillment capabilities and offered sellers an affordable shipping option so it could quickly ship orders to consumers.

In recent years, Shopify has continued to increase its investment in logistics, by taking the form of "talent acquisition" and acquiring smaller startups to recruit employees from these companies, such as the acquisition of social shopping startup Tictail in 2018 and the acquisition of augmented reality in 2021. Startup Primer.

Ensuring logistics efficiency and intensifying competition with Amazon

It is understood that the global market share of US e-commerce is 19%, second only to China. Since the outbreak of the new crown epidemic, the congestion of ports on the West Coast of the United States has increased, the global supply chain has been under pressure, and there are many uncertainties in the external objective environment. For Shopify, how to improve and ensure the efficiency of cargo delivery is particularly important.

Following its earnings report in February, Shopify's stock price fluctuated between gains and losses and halved on forecasts of slower growth. To reinvigorate the platform, Shopify's president came up with a plan: Shopify must Amazonize its business, with the ultimate goal of offering two-day or less shipping to more than 90 percent of the U.S. population.

Data shows that Shopify's share of the online retail market in the United States has increased from 0.2% to 14% in 2012-2021, which means that more and more American consumers place their trust in Shopify. In 2021, Shopify's share of retail e-commerce sales in the United States is second only to Amazon, and surpasses retailers such as Walmart and eBay.