OneVentures

Matthew Lewin

Logistics has come a long way from humble beginnings of simply getting goods from point A to point B. The shifting sands in the ‘new normal’ means that consumer expectations are constantly changing and the supply chain itself is being constantly disrupted by both tech and labour force pressures. In addition, economic and diplomatic tensions continue to escalate, not to mention that the way retailers operate (dark stores/dropshipping websites) is evolving at pace - which are all impacting logistic frameworks.

At its heart though, logistics is essentially an interaction between the business, its goods or services, and the customer. In a post-pandemic world, the customer has been emboldened with a new set of expectations – that of frictionless service, full transparency, unflinching trust, and unlimited accessibility. These are the expectations of on-demand commerce and an on-demand society – defined by unbridled convenience. This convenience is now the primary proposition in commerce as opposed to price and product, with attaining the loyalty of the customers celebrated above everything else.

The invisible world of online retail delivery

There have been numerous issues delivering on the promise of convenience in the new digital world. The intermittent step between the business and the customer - the businesses’ logistic operations - has been lacking the same desired qualities; being plagued with friction and inaccessibility. Shipping, delivery, and fulfilment have all been fraught with manual hassle, lack of transparency, and inaccessibility - making it hard for SMEs to keep up with consumer demands. For dropshipping websites (for example), the customer essentially buys from a retail aggregator website which never sees, handles or packs product. Having a lack of transparency between the retailer and the suppliers (which may be numerous, offshore and evasive) can create a large problem in being able to assure quality, expediency and fulfillment of expectations. There may be up to 6 or 7 different companies involved in the delivery of one transaction – who holds the responsibility for customer satisfaction?

"There have been numerous issues delivering on the promise of convenience in the new digital world"

These issues, in addition to shipping bottlenecks in everything from semiconductors to toilet paper has been attracting more attention to technology that can reduce the friction of logistics for SMEs, boost efficiency in distribution networks, and decrease the rising costs associated with increased demand. This is being reflected in the amount of investment into the space, with supply-chain / logistics technology startups raising $50Bn in 2021, up 65% from the prior year, according to PitchBook Data. At OneVentures, we see the growing need for improved logistics services, and look for companies to invest in who can really deliver a solution to create a positive and profitable experience for all stakeholders through the supply chain.

Creating delivery transparency and accessibility is key 

In Australia specifically, many technology companies seek to bring transparency and accessibility to logistics. For example, Shippit is Australia’s leading multi-carrier shipping technology company, allowing SMEs automate carrier selection through Shippit’s platform. From Standard, Express, Same Day or Click and Collect, Shippit lets you offer multiple delivery options in your shopping cart by connecting the company with the leading carriers. This gives SMEs access to all the leading carriers in one place and choose between pre-negotiated or exclusive delivery rates for their customers. This then provides businesses with transparency and data through real time shipping rates and analytics dashboard to track orders across multiple stores – offering suggestions on estimated delivery time, cost etc. The company continues to see success, having raised a A$65M Series B from Tiger Global in May 2022, as well as providing for a host larger retailer like Sephora, General Pants, and Cotton-On.

In addition to Shippit, companies like Fluent Commerce are providing transparency through an order management solution, helping SMEs handle to complexity of logistics, while Ofload and Explorate act as marketplaces for trucking and freight services respectively – supporting the accessibility angle. Factor in environmental concerns, and companies such as Zoomo - a producer of e-bikes with a focus on last mile delivery – have a huge amount of potential in an industry that will only continue to grow.