The e-commerce industry is booming, and it is expected to proliferate as technology continues to supplement a more connected globe of buyers and sellers. In 2018, North America e-commerce increased by 16 percent to over $500 billion. However, cross-border e-commerce is forecasted to continue growing by 25% annually - almost twice as fast as domestic e-commerce.
A considerable focus of e-commerce is placed on marketing to attract and convert buyers - and, in many instances, rightfully so. However, an emerging startup, Hipshipper, is targeting the international shipping component of the burgeoning e-commerce market. By explicitly focusing on a unique shipping solution that is seller-centric and provides end-to-end logistics and support services, the company is rapidly gaining traction in a crowded international logistics field.
"Our aim is to simplify international shipping for online sellers," says Hipshipper CEO, Yohai Ben Shmuel. "As selling globally is a must for any online retailer looking to expand their business, our solution enables exactly that, with minimal changes to current operation."
Addressing the Returns Problem With International Shipping
Hipshipper highlights that the growth of cross-border e-commerce is creating both new obstacles and opportunities for global logistics in the sector. The problems of international shipping are well known: it's expensive and complicated.
In particular, international returns have become a boiling point for many retailers. E-commerce returns tend to be 2-3 times more frequent than for brick-and-mortar retailers. The problem lies in the burdensome impact that returns have on retailers' margins, especially smaller ones. As methods for tracking packages and returns become more developed, one can assume that retailers will try to disincentivize product returns through various means.
However, Hipshipper has recognized the trend of deterring returns in international trade as an opportunity and built a singular solution to tackle this issue without putting restrictions on the buyers. "What we offer that is totally unique is free international returns," says Ben-Shmuel. "It allows sellers that refrained from shipping outside the US to enjoy the cross-border e-commerce boom, without the pain of costly returns."
Ben-Shmuel co-founded Hipshipper with Jonathan Birger, both with extensive backgrounds in the e-commerce sector. They pinpointed the problems with international shipping from their own challenges, and have instituted free international returns where return costs are actually 100 percent free for the seller -- something you'd be hard-pressed to find anywhere else.
The company started by targeting SMB marketplace sellers, focusing on eBay, where the leading solution is eBay's Global Shipping Program - the international shipping service used in over 30% of all eBay advertised items. Though a successful service that handles tens of thousands of shipments every day, Ben-Shmuel and Birger felt they can build a complimentary shipping solution to eBay GSP that is more comprehensive in its offering and better addresses eBay sellers' pains and concerns; a service that creates higher value for current GSP users, and more significantly - allows the 40% of eBay sellers that do not ship internationally at all to reconsider their choice and join this booming market.
"We enable marketplace sellers to grow their business, sales, and profits by using our SaaS and logistics operation that is deeply integrated with eBay (and soon Amazon and Etsy) as well as order management platforms," says Birger.
At its core, Hipshipper is an end-to-end online, logistics and customer service solution for the international shipping process. Sellers ship their products to Hipshipper's US-based shipping center, where they take care of everything needed to send the shipment internationally including product inspection and repackaging, and, of course, free international returns. Another unique focal point of Hipshipper is a dual customer service for both the end buyer and more importantly, acting proactively on behalf of the sellers to keep their marketplace metrics intact.
Their platform is integrated with multiple third-party services, offer reduced fees, and allow the choice for sellers whether to pre-charge customs. Their model has quietly been gaining traction among sellers - Hipshipper closed 2018 with over $2 million in revenue, and has over 700 online sellers actively using the platform.
"The combination of free returns with the ability to profit from the actual shipping enables US online retailers to offer their products to an international audience risk-free. If you have products that appeal to consumers, there's absolutely no reason why you wouldn't be selling worldwide."
E-commerce is finding its way into nearly all of the international logistics verticals. Ignoring the worldwide shipping market in a growing e-commerce industry is not a prudent business practice for sellers looking to gain an edge and expand their business. Therefore, innovative solutions to reduce costs and retain the simplicity of domestic shipping should naturally become the preference of e-commerce retailers.
The Snowballing Global E-Commerce Market
According to DigitalCommerce360 Global Sales Report, China e-commerce market has suppressed the U.S. already in 2017, and the trend is likely to accelerate as internet connectivity reaches a broader audience in China. Other Asian countries like India, Japan and South Korea are also making significant headways and are expected to take larger market shares in industries like fashion, beauty products and stationery purchases.
With free international returns and end-to-end international shipping service, Hipshipper is positioned to become the solution of choice for US-based sellers looking to expand their operations internationally but are hindered by high transaction overhead and the convoluted nature of international shipping. Profit margins for many marketplace sellers are often razor thin, and as e-commerce continues to balloon, look for sellers to seek more convenience and flexibility with cost-effective services like Hipshipper.
"What we offer to US marketplace sellers is quite straightforward - ship global like it's local. Continue to do exactly what you're doing. You'll hardly notice the transition to selling globally, except of course seeing your business grow."
The outsized growth of e-commerce is indicative of a dominant trend towards a more connected world. For marketplace sellers, scaling internationally is the way to success in the future retail market, and something that Hipshipper is aiming to help facilitate in an increasingly global era.