<img height="1" width="1" style="display:none;" alt="" src="https://dc.ads.linkedin.com/collect/?pid=57470&amp;fmt=gif">

Schedule a demo

We’ll show you how our platform works so you can see for yourself what Skubana can do.

Someone from our team will contact you shortly

Tackling the Challenges of Ecommerce Operations - Recording

Featured Post Image

Ecommerce businesses experience operations challenges as they grow 🙇‍♀️. Sometimes, it's with forecasting 📊 and inventory management 📦. In other situations, there are delays in fulfillment operations, or there's time wasted and errors introduced through manual data entry 🗂️.

While every business is unique, in this episode, we pull at some common threads that eCommerce merchants are tethered by as they scale up... whether they realize it or not.

Watch the replay right here or read the transcript below:

PODCAST_ TACKLING ECOMMERCE OPERATIONAL CHALLENGES_play

Transcript

Robert Rand:

Hi, and welcome to an episode of the JetRails Podcast. I'm Robert your host. Today we're gonna be talking all about, Tackling the Challenges of Ecommerce Operations and really a lot of what's happening behind the scenes at e-commerce businesses. What would business owners and e-commerce managers and others in organizations are doing or should be doing in order to operate more effectively and efficiently. And so with no further ado I'm gonna introduce our guest and let him say a little bit about himself, Chad with the Skubana team. Would you do the honors of telling us a little about yourself?

Chad Rubin:

Yes, absolutely. Thanks for having me excited to share any wisdom or nuggets that I possibly can with your audience today. Background, I mean, I've been in e-commerce for over a decade now. Started off in with my own business manufacturing filters and home appliances selling direct to consumer, across many different channels roughly about 10 to 15 of them, so multi-channel operations. We also utilize a fulfillment center, 3PL. In fact I have two of them across the United States, and out of the challenge of running my business and automating, I couldn't find anything out there. I'd had a lot of failed implementations. I lost a lot of money as you can see, a lot of hair as well and time, right? And that's the most important thing 'cause you really never get that back. And so we launched Skubana to really focus on the mid-market enterprise merchants and brands that are out there to help them not have to go through a painful agonizing deployment of an operations platform, but also it's purpose-built for today's commerce. Also dabbled in the prosper show as an early board member which is really an Amazon Sellers Conference that was acquired by the Internet Retailer Conference and wrote a book called "Cheaper Easier Direct." So excited to be here today and share anything I possibly can.

Robert Rand:

Very cool. Yeah, I'm gonna ask one of my favorite questions. How did Skubana get its name? 'Cause obviously like I'm figuring SKU there as in an item, but did that take a lot of kicking around in order to figure that one out?

Chad Rubin:

Like most great names, the genesis derives from a lot of glasses of scotch. And so once we got at least four glasses in, we closed our eyes, me and my business partner, DJ. We close our eyes and we said, "what do all brands and sellers want in life?" And the thing that came from me, was this like vivid imagery of like being in Cuba, being out of hammock with a beer a child running around on the sand and having my business run itself. So we started playing with this idea of Cubana or Cubano. The male version of that, Cubana and then I was like Skubana and we were like, "Aha, that's freaking awesome, let's do it."

Robert Rand:

That is awesome.

Chad Rubin:

Yeah and so we launched and it wasn't that it wasn't like if I write to sort of I F Y last name I could have been like, Skubanafy or something like that, but like that was played out and we just started a new trend. And hence we were talking just before this call we were talking about like the fedoras the Cuban fedoras that we were giving out at the Internet Retailer Conference two years ago, that's really, really paying homage to the name and to the Cuban culture.

Robert Rand:

That's really cool. I mean, I'm here in South Florida where I get a taste of that culture regularly but there's something to be said for that. And it's funny that I was listening to podcast the other day about how Cuban culture and for a lot of American households got introduced through the I love Lucy show, which really became such mainstream Americana. And sometimes it's fun to have a little bit of real flavor into things like that. I mean, I'll admit for anyone that's seen the video from our podcasts that I've got this teal paint in my office and I was going for this vibe that I really figured if I was gonna be in here all day, I wanted to be able to imagine that I was out in the Caribbean somewhere and just kicking back a little bit and that it would, make it a more pleasant experience for everyone that it had nothing to do with jet rails colors or anything else in particular. It was just, this is what's gonna chill me out, as I work on technical documents and help that partners and do what I do. So sometimes something just has to strike you. It has, it has to feel right. That's really... I like that.

Robert Rand:

You kind of touched on that. You tried some other platforms, you didn't have good experiences, you lost money. If you had to peg a specific at the time feature set going back 10 years, was there something in particular that you found that at that time, because I'm sure things have evolved since. But that the market was really missing something that these other platforms just really all didn't have a leg to stand on for.

Chad Rubin:

Yeah. A couple of things. One is obviously a decade in e-commerce is sort of a lifetime in retail. And a lot of these platforms were built for a newbie seller in mind, right. In a very amateur or their entry level platforms sort of like trying to kind of state with a butter knife. And so they weren't built by a brand or merchant, right? There wasn't the framework of the platform. It just, somebody had an idea or they had an MBA and they went to Joe solve a problem. This was actually us dogfooding the business, meaning I had my problems. I experienced some real time and I needed these problems solved. And I knew exactly how to navigate that with my business partner who essentially architected the platform. So I think that's the first piece is like the technology was again, built incorrectly. And I think that was the start of it. And of course, as merchants and brands have grown these digitally native brands have off as being just direct to consumer, because of just the market conditions in general they sort of blown up into being direct to everywhere. And with that comes a lot of complexity. And you needed to have a platform that can solve for that complexity in the right manner. And I think we did it.

Robert Rand:

Yeah. And I think that's a common theme in the e-commerce world that, all of the major software integrations that I've come across through the years. And I've spent a lot of time on that side of the industry. You're connecting things that weren't built for e-commerce users. So whether they were CRMs or accounting suites or ERPs or point of sale software for in retail stores, these are things that were built for brick and mortar. They were built for wholesale channels that dealt with phone orders and faxes and other modes not necessarily for communicating effectively with a leading e-commerce platform. And so I'm completely with you that I think that that's where the market is in some cases struggled, because it's kept trying to integrate things that really weren't a great fit in the first place legacy software.

Chad Rubin:

The question is, how do you build a next generation business on last generations technology? It's impossible to do it. And so you have to remove that friction. You need to have an agile software in order to unlock nonlinear growth.

Robert Rand:

Yeah. And so thinking more about the individual problems that this leads to in the case of operations, and what would your team solves for, what are some of those actual challenges that these companies are facing when they're not using a proper solution when they're still in Excel sheets or when they're using legacy software or other solutions that just aren't properly achieving what should be achieved in today's market?

Chad Rubin:

Sure. So there's a broad range, right? There's the entry-level merchants and brands, and then there's the ones that are more advanced. So I'll start with the entry level merchants first. Those are the people that are using Excel spreadsheets. They're using a shipping software. It doesn't connect to an inventory software or a desk net, but it's very slow or there's a latency involved, or it's missing unified data to be able to make decisions in your business. So when you're using all these different softwares and it's not unified, nobody's on the same page, right? So you need to have, there's this notion of you have one analyst using this software, another analyst using this software and to actually run a systemized business it requires use everyone on the same page using the right language, the same language. And so that's what Skubana does for these entry-level merchants and brands, right? We unify everything in one place where you take shipping and then everything else you need to run the business into one platform. And now you have day-to-day act on. When you look at these mid-market enterprise level brands and merchants that are doing e-commerce and they've been doing it for a really long time, sometimes they're growing out of these entry-level softwares, or they're growing out of a low level competitor that Skubana has, and they want more to thrive. And so these brands and merchants are looking at a big build like NetSuite or SAP or Microsoft division, right? These businesses were never built for e-commerce. In fact, there is no E in commerce when they first even developed a software. So they try to sort of, they buy this Ferrari, and nobody knows how to service it. Nobody knows how to drive it. And you're stuck through this agonizing painful deployment that goes three acts or four acts above budget. Whereas Steven has a three-week deployment cycle, right? Our implementation is three weeks did onboard our system. We have solution engineers in-house so we're really trashing the way people are viewing how to run their business and what you really what are the tools or the systems that you need to run it even as you get to the later stages of your own brand?

Robert Rand:

Yeah. This is a pre-recorded show but I can hear some listeners pretty upset that you can deploy something like Skubana in three weeks, given what they've been through.

Chad Rubin:

Yeah. I mean, that's sweet a year and a half, two years in a sales team is so good there, that they sell you on the bare bones and then suddenly as there's a reseller, there's a consultant involved and now suddenly you're three or four acts above the scope of whatever you needed initially.

Robert Rand:

That's the model with a lot of big software and you think of something like Salesforce, it's not just the licensing fee, it's the amount of customization that you need to really get your money back out of the software within your organization.

Chad Rubin:

Yep. Yeah.

Robert Rand:

What are the major feature sets that you wound up focusing on as Skubana came about? I imagine that there was a core of features and that ince you've continued to expand just a little bit further.

Chad Rubin:

Yes. So my issue when we first started Skubana, was I just overselling inventory. And Amazon doesn't talk to eBay, eBay doesn't talk to Magento. And so I was just overselling inventory and not providing a delightful customer experience. So initially I just wanted an inventory system. I was like, "that's the meat and potatoes." That's all I wanted. And DJ, my business partner was like, "no, you need to because there's an extra E now in commerce, "you need to actually combine shipping the order "management system and the inventory management system "together, it'll reduce latency." And you build a pull in the shipping cost of that whether it's a three PL or it's, or it's a shipping software like that we built internally pulling that dollar value. And now you can actually plug that into our analytics module and have real-time business trojans to like move your business beyond where you ever imagined. And so we built orders, which is everything after the checkout, right? So orders, inventory, forecasting, demand, planning profitability diagnostics, all in one platform with an app store that helps you add strength to the platform with a click of a button.

Robert Rand:

We just had a, one of our most recent episodes was about black Friday and cyber Monday and the holiday shopping season, Q4 2020. And it strikes me that one of the challenges that we chatted about or that I chatted about with our guests had to do with returns. And it was pointed out that you don't even know at this point, we're now toward the end of January, 2021. And you don't know exactly where your balance sheet sits because you haven't taken into account returns. And that so many marketers and so many brands focus so much on return on ad spend on row as for marketing campaigns without taking that kind of data into account. So I can see easily where, where these sorts of things are really difficult when the information is siloed, when the right people don't have access to the right data. And they're working on some form of miss assumption or just perhaps misinformation about what the true winners and losers are across the business.

Chad Rubin:

Yeah. And just to piggyback on that, right? Returns is one aspect, but let's, let's peel back the onion a little bit further. Let's let this flower blossom. So you'd have returns but on top of that, let's just say, you're selling across five different channels. You're selling across target, Amazon you're on Magento or perhaps Shopify or big commerce, right? And maybe you're on a few other long tail channels. So as you're actually processing these orders QuickBooks or NetSuite, they show you your revenue, they show your expenses and they show your profit. They don't show you why you're making or losing money specifically what SKUs on what channel. And so we pull in all that information, so you actually have the why, which is the most important part of it is that, you know exactly what SKU, what channel is your winner or your loser on? And if you're losing money on that channel how you can just right the ship to make more money and increase your contribution margin, or that specific SKU on that specific channel, or just liquidate it. And so I think that kind of operating profit per SKU, which is to me the Holy grail of what every e-commerce merchant wants, they can't get it out of these clunky softwares but you couldn't get it out of Skubana. Just an example.

Robert Rand:

Well, how much might you spend with a consultant with one of those clunky platforms to be able to pull that one report?

Chad Rubin:

Yeah. That's on top of it, correct?

Robert Rand:

Yeah. That makes sense from my perspective. I think that that's where a lot of businesses struggle. We see the same at jet rails where a lot of businesses don't have a good understanding of how their loading speed is impacting, their overall revenue. And we can pull reporting for them based on Google's data on where their speed is out and what that's costing them. There are all sorts of things that often they just go neglected because merchants don't have the data at their fingertips. They don't have a pulse on some of these things that they can be extremely impactful to a business, so...

Chad Rubin:

Hey Robert, When you say loading speed are you talking about the website load time?

Robert Rand:

Absolutely. About different page load speed.

Chad Rubin:

That is so fundamental, so important to not only getting someone to actually convert on your site, but also for SEO purposes as well. Like, I can't focus on that enough when I talk about it. People think I'm just nerding out but I'm like so focused on speed.

Robert Rand:

Yeah. And it even has an impact on some of the ad campaigns. So platforms like Google ads they use the page speed of your web pages when they're factoring in a page scores, which are gonna have to do with how much you're bidding and how often your ads are being shown and what position at what cost. And sometimes some of these things when you actually do the math on what a slow or slower than it should be site is costing you. It's not just your conversion rate which is absolutely impacting, but absolutely it's stopping you in some cases from earning the shoppers foot traffic into your website, so to speak and from getting into the site in the first place. So a lot of these things, there are these interconnected webs within e-commerce of how one thing bleeds over into another one thing impacts another. And that's where understanding your data and having the right solutions in play. It absolutely makes a lot of sense. You mentioned Amazon and eBay, and certainly some of the major e-commerce platforms. Are there any up and commerce that you've seen? Anything else that you see really coming about? We mainly see the, the big ones continuing to take up most of the market share. I think it's gotten a lot harder for new players to really break in with any major market share with any exponential growth, but you've got your Magentos and big commerce and Shopify guys, and add something to the world.

Chad Rubin:

I think most importantly as a brand, you want to be where customer lives or where they are, where they shop. Wherever their eyeball are, that's where you're can get wallet share. And so for me, for specifically on my home appliances and accessories business, I still have today, but that is automated with Skubana. We are selling on home Depot, we're selling on Wayfair, we're selling overstock, we're selling through those marketplaces that people don't even know exists. Google shopping actions, for example, is another one that is a Google has converted a lot of their PPC into actually a referral commission share model, where they getting where it's more important to get a conversion over just a click. And they're making money on the actual sale itself. And I think for each business is very different. And for example, if I was in beauty, I wouldn't be on home Depot. I would probably be on Sephora and a drop ship vendor model where selling through that channel target has target plus now, the target marketplace that's fairly exclusive, really focusing on digital nated brands. And so I think you just have to sort of think about where the demographic of your ideal client profile, where they shop, where they spend their time and focus on attracting their time and attention towards your ad spend.

Robert Rand:

Makes sense to me, if your shoppers are Walmart shoppers then it's probably a good place to be.

Chad Rubin:

Yup.

Robert Rand:

When folks get to Skubana, I know that I still run into merchants that absolutely are still keeping a lot of this data in spreadsheets. I still run into a lot of merchants that are on products like QuickBooks and such for accounting and trying to run some inventory and other things out of there. Do you find that there are particular platforms or situations in which people are more readily upgrading and getting onto a more modern stack? Is there any sort of, I don't wanna ask anything too proprietary, but any sort of an audience that is moving faster than others? I think in the last year. So we've all seen a lot of merchants making a lot of upgrades to a lot of things because they needed to catch up with curbside and in store pickup, they needed to catch up with the end of life of Magento. One, they needed lots of things happening of course . Any trend lines that you're noticing?

Chad Rubin:

For sure on our website, we have a good friend at Skubana and also client is Tushy and they make these bodegas. And so during the pandemic, obviously there was a run on toilet paper. People couldn't get TP. And so what they did was, they really wanted the bodegas. And so this company blew up. And as you're reaching a certain, a steep philosophy and as you're scaling really quickly, one of the fundamental pillars of Skubana is really complexity. So the more complex, the faster you're growing the more things are breaking, the more we thrive because we actually can actually help you overcome those complexities and do it in a very beautiful way. And an efficient way as well. And so they needed to ship directly from Hong Kong or Asia directly into the United States and pivot super quick into a different third-party warehouse to get their merchants, what they needed and to delight them. And we were able to accomplish that. And we have that case study on our websites. That's just one example. I was saying that the rising tide of the shift of spend to online retail, from offline retail, sort of the rising tide lifts all ships. We had our best year ever. I think a lot of our brands and merchants had our best year ever. I would probably say that if you're in the travel category, that has probably taken a little bit of a dip, right? 'Cause I travel. Stops and perhaps the brands that were focused on high-end fashion or started working on a comfortable fashion, right? Work from home fashion, being comfortable with yourself and with the clothing that you're wearing when you're working from home, and still looking good. So I think our brands had a great year it's of course across a really terrible backdrop, but we've been at least it's Skubana. The way I look at it is like we've been positioned to help. We help our customers stay in business. We helped our clients, our brands, our merchants stay in business during a crazy turbulent time with a lot of unknowns. And we were there for them to help them grow. And I think that's most important. But yeah it was a tough year for a lot of people out there. And my wife went to yoga studio. Right? Which is a yoga studio in New York and it's been decimated with the pandemic. So not everybody has had the same experience that we've had being the fact that we're in e-commerce, but I feel very blessed.

Robert Rand:

Well said. I think that in e-commerce there are a lot more to put it a little bit inelegantly, more winners than losers if we were to look at it on a spreadsheet. A lot of categories, significantly app, I mean as a web host, you know, we helped a lot of businesses through their scalability challenges. And we got to see some of the benefits of where we sit in the ecosystem as a result. That's not to say that everyone was growing. So there are websites that we may have been dealing with that are selling event tickets or other things that we're not having that kind of a year. And thinking about that pivot for a lot of businesses, I know that a lot of the offline businesses have to get online quickly and that that has its own set of challenges for a retailer or a wholesaler that now really needs to do a much better job of making ordering catalogs and ordering available through the internet the way that they probably wanted to earlier but just hadn't been pushed to, or hadn't achieved yet. What about the folks that were selling more? So either direct to consumer through Amazon or a wholesale through retailers. I've seen growing into e-commerce aren't necessarily net new to the industry per se, but maybe they just didn't have their own e-commerce retail sales channel before. Have you been running into any all variations?

Chad Rubin:

Yes, so suddenly e-commerce became, this is an area we need to focus on right away. And it wasn't getting a lot of mind share internally at big corporations and they need to pivot and they're using these legacy technologies that I'm talking about where they can't. It's just for them their technology leaves them in a model. So they've been discovering Skubana, through their RFP process and we've been helping them. So, yeah, we've seen a ton of like traditional retailers, making the move embracing e-commerce as an actual channel and really putting a lot of mental energy into winning market share in the e-commerce world. And that's trickling over by the way into Amazon as well because Amazon was like frenemy to a lot of retailers and sort of people didn't wanna embrace it, and now obviously Amazon being 50% of e-commerce share in general of transaction share. They're now like, okay, we need this as a channel, we need to optimize and start selling through and you're seeing ad spend crushing people on specific categories now like big companies, who don't have to worry about this budget, just go are going crazy. Which is increasing the advertising cost of sale for all those that are actually in that specific category.

Robert Rand:

In a sense, the reason that I watched from the early days of platforms like Google ads and lots of others, where the cost per click was relatively cheap just like SEO, the competition wasn't as fierce you could rank with a new site relatively quickly compared to what we experienced today in a much more full market. So to speak online, that having such fierce competition that having already so many others vying for the same rankings and the same shoppers and the same customers, it brings its own challenges to the internet. And I think that, that's where you have to have your sharp margins. You have to be really operating efficiently. You have to be able to pull apart your winners and your losers and really get it right because it is more competitive. And when people are shopping somewhere like Amazon, I always think of it as whoever's selling the item the cheapest, is gonna get the buy box or a similar item that it's much more of a commodity play. They're not really your customers they're Amazon's customers. They're gonna find what they're looking for. I mean there are some cases where they're looking specifically for a name brand, but in a lot of others, they're very flexible.

Chad Rubin:

I think 70% of the search volume on Amazon today is actually not named brands. It's just the generic word. I'm looking for tinfoil. I'm looking for a water bottle versus a name brand. So I think you're seeing a lot of brand equity being diluted specifically around that business. Now people shop based on reviews and ratings and what Amazon gives them on the first page and discovery process. So yeah, you're seeing a lot of that happening right now. And just to address where you're speaking about that profitably earning that customer's business in 2020, what I saw in 2020 was a lot of venture capital spending a lot of money, to invest in these direct consumer brands and that all people cared about was top-line revenue. So 2020 to me was like the year of revenue 2021 to me is a year of profitability. Now people are really starting to smarten up and say, "what is the lifetime value of our customer?" "What's our cost of acquisition to get that customer? "How do we increase that over time? "How do we actually make sure "that we're profitably making money "and sustainably scaling the business a miss the pandemic?"

Robert Rand:

It's no small order. It's a big challenge to be able to... Look ,building business that drives some revenue is one thing being profitable is quite different. As a lot of us in techno. There's a lot of really popular tech brands that are yet to turn a profit. So seeing venture capital head in, as you've suggested into these direct to consumer brands and other things, I think that that's a challenge that they're gonna have to overcome that with tech we're always estimating customer lifetime value and trying to elongate it and figure out how we can be stickier and bring more value and all these different things. I think it's not that it's not that a consumable or other thing that they're not trying to figure out how can they do that? But I think depending on what was being invested into, some of the best brands that have gone direct to consumer online companies like Warby Parker how often am I buying new glasses? Companies like Casper with mattresses, how often am I replacing my mattresses? There are challenges to some of the models. I'm sure that some of that knowledge isn't lost on investors. But I'm gonna circle back for a second 'cause I know we've talked about a lot of sizes of merchants. How big do you think a merchant typically needs to be before they're gonna start really running into these challenges? Is it about the number of products that they have the amount of sales or revenue that they're having? Is it about some other metric that is kind of the breaking point when they start to really feel the pain of still being in spreadsheets or still using legacy systems or otherwise not being analytical enough and nimble enough in the market?

Chad Rubin:

Yeah, I think a Notorious Big said it best. He said "more money is more problems." And so what happens is, as you're scaling an e-com brand, once you hit a specific revenue threshold and you start wanting to expand, it could be in a SKU count, it could be in fulfillment methodology or warehouses or how you fulfill, maybe you're having two warehouse footprints, or maybe you're going from five SKUs to fifteen SKUs and you're doing bundling and kitting. But regardless of that what we see at Skubana, is typically at about 2 or $3 million. That's really when the problems start to arise of revenue, and it goes all the way up from there. And then on the flip side of that is you have these big brands that are trying to embrace e-commerce right now and trying to figure out, how do I sell direct consumer? I can't do it on my green screen technology that I have from 1972. So I need to upgrade. So I think you have two different things that are happening but it comes down to the fundamentals, which is just complexity, the more complexity. The more money you're making, the more SKUs you have, the more channels you have, the more fulfillment places you have. That's where Skubana becomes a powerful.

Robert Rand:

That certainly makes sense. And I, don't often on the podcast talk so much about partnerships but it's what I do when I'm not taping podcast episodes. And I think it's particularly interesting. You talk about a systems like Microsoft dynamics and division, nav and others. I don't imagine that those teams are spending nearly as much time working on their own integrations via API APIs and working on solving problems with others in the e-commerce ecosystem, the way that it seemed like yours might be. How has partnership really impacted what you do and how you operate?

Chad Rubin:

Partnership is a very great channel for us Skubana specifically, one is because like I mentioned we have an app store. So the app store helps us add strength to the platform and bring best in class softwares into the mix where we don't actually play in that space. So I think that's a very important piece of it is the technology integration that we have in the app store. And then B, when it comes to partnerships I think about what's one step removed from Skubana in the e-commerce world. So it could be a channel like Amazon or Walmart or E-bay or anyone else or read or target, or it could actually be like a three PL. So we have a really symbiotic relationship with fulfillment centers because essentially they kind of go hand in hand. Skubana as an operating system and a third party fulfillment center, if you're moving 3PLs you need an operation system. If you have an operation system and you're considering fulfillment 3PLs are always part of that conversation.

Robert Rand:

Cool. And, I'm gonna pick your brain just a little bit before I let you run for the day. Anything new coming down the pike, anything else interesting or exciting crossing your desk?

Chad Rubin:

Interesting, exciting. Everyone loves shiny objects, and Skubana certainly is. Our back in operations and automation, isn't the most setty thing to a lot of people, but to me it's one of necessity. It's not a luxury. And I just love shaping what our mama gave us. I wanna really focus on making our clients happy, and once they have that outcome, it'll be a great outcome for everybody at the company. In terms of things that I'm seeing right now, there's a lot of buzz around. We talked about 3PLs, there's a lot of buzz about 4PLs. Are you familiar with the 4PL?

Robert Rand:

I'm gonna have you educate our audience. So I'm gonna play dumb for a second here.

Chad Rubin:

Got it. So I it's like 3PL or 3G, 4G 5G. And so you're seeing 3PLs, which are fulfillment centers, that we have really good relationships with. Let's just say it's Ruby Has, or a Shipmonk, for example will be another one. Now what you're seeing is instead of the fulfillment center owning the underlying asset, the warehouse, they're saying hey, "we're gonna go find these fulfillment centers, "we're gonna white label them with our own brand, "and you'll be able to use their idle space "almost like an Airbnb for fulfillment warehouses."

Robert Rand:

Makes sense. So we were going from a third party fulfillment and logistics to a fourth party logistics center where it's on demand. It reminds me of what we do with AWS, where, we have our own servers and out in Chicago and we host lots of our clients on bare metal that we manage but we use AWS where you don't know exactly which rack somewhere you're actually using. You're leveraging a network that's already up and running. And so you're not responsible for all of that infrastructure. They handle it. It's just, it's so interesting that so many facets of technology and the e-commerce industry as a whole running into that paradigm of, you don't need to own it, manage it, pay for everything all the time that we can have more of this shared economy for it, even in some ways the way that I think about open source you don't need to code everything yourself that we can do this as a community and maintain it together. And it's an economy that scales much better than everyone else out there responsible for all the costs by themselves. So that's particularly interesting. I haven't seen as much. I'm reading more about folks building these brand new pristine fulfillment centers, that they're not gonna be using directly, that they're gonna be leasing out in this sort of a way like they're perceiving the demand.

Chad Rubin:

But there's a lot of money going into this right now into this 4PL model. Now, interestingly though, being a brand and merchant also working with brands and merchants who are always suffering from the pain of working with these fulfillment providers they never deliver on their promises, and over promising, under deliver, they make mistakes. They contribute to a lot of their returns. They have no customer support. It's gonna be interesting to see how these 4PL models shake out. There's a lot of money being put into this right now. I'm curious, and I wonder if, how sustainable it will be because people wanna be able to be nimble and agile. Built a move like we're agnostic. So Skubana is agnostic to any, if you use 1, 3PL, and you wanna move another one, you can quickly shift resources very very quickly and plug into those resources. But if you're tied to a network and you're also using software, that's tied to the network and you can't sort of unlock that. It's tethered together, it's in a run into a lot of challenges, scaling issues into the future.

Robert Rand:

Yeah. I think that we're gonna see a lot more money moving into this. Anything tech in the last year to anything e-commerce gets the market's really excited gets investors really excited because it's the future it's growth, but I I'm with you that it's gonna bring its own challenges as these things evolve that as often happens. Chad, you've been really generous with your time today. I'm sorry that we're not getting to catch up in person like we normally do, but this was absolutely fantastic. I really appreciate you coming on today. And we hope to hear some updates from you soon and hopefully there'll be a lot more good news coming out of the e-commerce industry so...

Chad Rubin:

Totally. Thanks for having me on, thanks for letting me share. And if anybody wants to find out more you can always email me. And my personal email is just chad@skubana.com.

Robert Rand:

Awesome. And for our listeners, thanks as always for tuning in happy selling and stay safe out there.

Comment (0)

More from Skubana

Ecommerce Automation Automation Hacks for Ecommerce Operators - Recording Read Article
Ecommerce Best Practices Accelerate: Ecommerce trends to watch in 2021 - Recording Read Article
Ecommerce Best Practices Innovative Ecommerce Insights 2021 - Recording Read Article

Watch Webinar

It's as easy as entering your information.

Invalid input