Inside Logistics

Shopify opening U.S. fulfillment centres

Company to spend $1 billion on developing network


June 20, 2019
by Ian Bickis, THE CANADIAN PRESS

TORONTO – Shopify Inc. has launched a network of fulfillment centres in the United States to expand its suite of offerings for merchants in the competitive world of online retail.

The network will allow merchants large and small to gain access to advanced logistics technology and simplified warehousing and shipping, chief product officer Craig Miller said.

“We’ve taken something that used to be costly, complex, and well, convoluted, and made it totally approachable,” he said.

Speaking at Shopify’s annual Unite conference in Toronto on Wednesday, Miller said the network will also give merchants more control, both over the customer experience through things like branded shipping boxes, and over the actual sales data.

Without naming Amazon, a key rival in the space, Miller said some order fulfillment companies are using data to create unfair competition.

“Recently we’ve started to see market chasers using data like order volume to actually decide to create knock-off products for less money and lower quality, potentially competing with the actual merchants.”

The network will initially be rolled out to qualifying merchants who ship between 10 and 10,000 items a day, with plans to expand it to anyone who sells between three and 30,000 items a day, he said.

Shopify plans to spend over $1 billion over the next few years on the network.

The company did not disclose if and when it will expand the fulfillment network into Canada.

The network is part of the company’s strategy to reduce areas of friction, and level the playing field for everyday entrepreneurs, CEO Tobi Lutke said.

“Shopify is driven towards pain, wherever there is pain in the experience of building the kind of businesses we celebrate on stages like this,” he said.

“We want to have a conversation about how far can we take this idea of making it more approachable and simpler for more people to reach for their own independence, and build the kind of businesses that they might have always wanted to build.”

Other announcements at the conference included support for 3D imaging, more language and currency offerings, updated designs for online stores and point-of-sale, and a new platform for larger merchants.

Shopify, which says it has 820,000 merchants as customers, is a technology platform that helps retailers sell merchandise online.