Dive Brief:
- UPS subsidiary Ware2Go is expanding its warehouse footprint and bolstering its fulfillment options for Amazon sellers through an agreement with e-commerce platform Whitebox, the companies announced Tuesday.
- As part of the deal, Ware2Go will add three Whitebox facilities in Baltimore, Las Vegas and Memphis, Tennessee, to its network of on-demand warehouses, CEO Steve Denton said in an interview.
- The deal also allows Ware2Go to offer new fulfillment solutions for Amazon merchants, specifically Fulfillment by Amazon prep and first-party inventory services. Businesses selling through the e-commerce giant are a notable portion of Ware2Go's client base — more than 20% of merchants using Ware2Go use it for Amazon fulfillment services, Denton said.
Dive Insight:
It's been a fast start to 2023 for Ware2Go as parent company UPS pursues revenue streams beyond package delivery. Ware2Go announced a team up with Gap's GPS Platform Services last week to strengthen its logistics and fulfillment capabilities, which Denton called "a home run.”
With the Gap partnership and the three additions announced Tuesday, Ware2Go now has access to 43 warehouses, Denton said. This expanded footprint provides both improved geographic coverage and synergies with UPS' same-day delivery unit, Roadie.
"As we continue to build out our footprint, it gives us the opportunity to start thinking about same-day delivery for our clients through partnering with Roadie in some of these large metro markets," Denton said.
Ware2Go also plans to expand its workforce by bringing on customer-facing employees from Whitebox, including salespeople and account managers, Denton said. For Whitebox, an e-commerce platform with an in-house Amazon advertising agency, moving away from warehouse fulfillment services provides a chance to tighten its focus.
"They didn't want to be in the supply chain business anymore," Denton said, of Whitebox. "They just wanted to focus on their marketplace business, so it was really opportunistic for us to be able to bring in the supply chain business and all those capabilities."
Whitebox will provide Ware2Go clients with services to drive their Amazon sales growth, and it will keep building products for aggregating and analyzing e-commerce data, according to a news release from the company. The partnership will help Whitebox's clients grow by providing them with "insights derived from an expanded logistics network," CEO Marcus Startzel said in a statement.
For the next several weeks, Ware2Go is focused on ensuring a smooth transition for clients that used Whitebox's warehouse fulfillment services, Denton said. Beginning in March, Ware2Go plans to start placing additional clients into the three new warehouses it has gained access to.
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