19/09/2019
Shopify to invest over 1 billion USD in their own fulfilment network
Shopify has been one of the leading eCommerce platforms in the past several years in terms of the flexibility and affordability, and as such is one of the favourite options for the retailers who operate on a smaller scale or just starting their online operations. The very fact that this SaaS platform requires a very low initial investment and that they provide a myriad of options via their integration partners was good enough to persuade many smaller businesses to opt for them.
Still, these same businesses had a rather serious problem with fulfilment as integrating and using multiple carriers was a rather costly option that lowered the initial high value of a cheap and flexible platform the Shopify is.
Now, things are changing in this department!
The new fulfilment network
In order to remedy this issue and increase competitiveness at the time when Amazon begins to dominate the market, Shopify decided to offer a real answer to that challenge. Namely, they decided to invest over 1 billion US dollars in their own fulfilment network that would be at the disposal of the businesses using their platform!
This is important for several reasons. Firstly, this is a direct competition to the Amazon FBA, and the move is designed to persuade sellers to maintain their regular online shops instead succumbing to the lure of selling on the Amazon just because the fulfilment options are better and easier to manage if they do so.
The second reason is getting an upper hand over the competitors in the segment of eCommerce platforms, as this approach is rather unique and is not being offered by other platforms. That way they hope to encourage the sellers using other solutions to migrate their operations under Shopify, as it will allow them simpler management of the fulfilment process, which is one of the most complex operations in the online retailing business.
Shopify executives claim that this huge investment will allow their clients to fully focus on the sales and attracting people to their websites, as the off the shelf option for fulfilment becomes instantly available. It is a reasonable assumption and it is to be seen how it will affect the distribution of the clients between the eCommerce platforms. It will surely make Shopify a prime option for all the smaller companies with limited budgets and limited goals.