Amazon is setting the bar very high for e-commerce merchants in terms of delivery. Read how the industry is responding.
Sramana Mitra: Let’s start by introducing our audience to yourself as well as to Ruby Has.
Rafael Zakinov: I’m the Founder and CEO of Ruby Has Fulfillment. We’re an e-commerce-focused fulfillment company. We’re based out of Long Island, New York. We have locations throughout the United States servicing both coasts. We have come to be a real brand name amongst emerging B2C brands.
Sramana Mitra: What scale are you at? How many customers are using you? What size customers are you particularly suited to?
Rafael Zakinov: We currently have over 180 customers. Our customers really range. We have startups to VC-backed companies and also publicly-traded companies.
Sramana Mitra: Can you talk a little bit about the trends in your industry? Where do you feature in that conversation?
Rafael Zakinov: With respect to the key industry trends that we see, everything was about cost three years ago. Now it’s about speed. After you click the buy button, how fast can the customer get the product? Right now, that is a major industry trend. Back in the day, it was free shipping. Then, it was three-to-five day shipping. Then, two-day shipping and now, it’s same-day shipping. Companies are struggling to accomplish that and we’re bringing solutions to our customers.
Sramana Mitra: How do you do that? How do you compete with Amazon on same-day shipping?
Rafael Zakinov: Amazon doesn’t necessarily spend more money to get it to the door faster. They bring their distribution centers closer to the consumers. We have centers very close to major populous hubs where we enable same-day delivery. Let’s say one of our customers is Brooklyn Inn. If you buy something at 11:30, it will be at your doorstep between 6 PM to 7 PM.
Sramana Mitra: But how?
Rafael Zakinov: We use couriers. We use a multitude of products to enable us to achieve that.
Sramana Mitra: It’s all about the placement of the delivery centers – nothing else is critical in this algorithm?
Rafael Zakinov: As far as the algorithm goes, we track and see where the consumers are by zip code, ensure that the zip code is serviceable by same-day delivery. If it is, the option is displayed to the consumer on the shopping cart level. That’s how that’s enabled.
Sramana Mitra: At what level of delivery center coverage have you achieved scale in being able to do that for your customers? Like how many delivery centers do you need to be able to do this?
Rafael Zakinov: It depends on what cities you’d want to reach. Right now, we have New York covered. We’re launching LA and San Francisco for next-day delivery. Essentially, you would need to place your centers very close by – within a 50-mile radius of major cities. That is the trend that we are tracking and executing on.
Sramana Mitra: If I’m an e-commerce company and one of your clients, you only have New York, and you’re starting LA and San Francisco, how am I covering the rest of the deliveries that I need to make?
Rafael Zakinov: We currently have three facilities in the US – New York, New Jersey, and Las Vegas. The other zip codes are achieved with two to three-day shipping depending on what kind of service levels they’d like to offer their customers.
Sramana Mitra: Can you help me understand the ecosystem of the options that the e-commerce companies are working with right now?
Rafael Zakinov: With respect to fulfillment?
Sramana Mitra: Yes.
Rafael Zakinov: You have many options. There’s the traditional route of having your own warehouse. You then have the option of using a third-party provider such as ourselves or Amazon. Those are the two options. The least one that is used is the third option of having it drop-shipped, which is rarely used especially for e-commerce brands and entrepreneurs who make their own brands.