The e-Commerce Store’s Hero in Logistics: Rakuten Super Logistics
One of the facts of life for any business is that your leverage with suppliers increases as you grow on the way to reaching enterprise size. For growing e-commerce businesses, economies of scale derived from your leverage with logistics partners just aren’t available. That puts growing business’ in this sector at a significant disadvantage.
Additionally, the fact is the big players have set customers’ expectations high: because consumers can order today and get expedited, free delivery, every other retailer has to offer the same service levels, whether it’s affordable for the seller. For growing e-commerce shops, margins are going to be thin – sometimes non-existent.
What’s also become obvious to many logistics industry watchers is the tendency (fast becoming a full-blown trend) for certain carriers to maintain peak pricing rates for longer and longer. In some cases, those peak rate pricing structures have somehow become part of “the new normal” — and it’s the little guys in this competitive sector that suffer. Smaller e-commerce retail outlets are forced either to pass on higher or slower delivery options to their customers or take the high logistics costs on the chin and look elsewhere to shave costs. Either way, it can be a struggle to stay on the right side of profitability.
There is, however, bright light at the end of the tunnel. Rakuten Super Logistics is bringing the massive buying power of a global business to bear on behalf of the smaller retail operators. It’s a big company that will naturally benefit from economy of scale when it buys logistic capacity wholesale (Rakuten worldwide turned over $13.6 billion in sales last year). And it passes those savings on to its customers in smaller e-commerce shops.
Right out of the box, that means an average saving of 6% to 8% on carrier costs for even the smallest outfit. By sourcing delivery services from a menu of household name national logistics companies and thousands of regional delivery firms, Rakuten Super Logistics can choose the best rates and the best deals on behalf of its customers.
Typically, e-commerce businesses need to spend a lot of time cross-comparing carriers’ rates, switching from one supplier to another depending on that week’s extant pricing. Even the best deal, once tracked down and made good into a firm offer, may not last — and it certainly won’t be the low price offered to the huge retailers.
But with Rakuten Super Logistics onside, every business can now offer fast, expedited delivery at low or no cost to the customer without taking a hit in margins.
Michael Leung, CEO of Sleepypod, has been using RSL. He said, “[Its] fulfillment network stretches across the United States and enables us to reach our customers quickly and with guaranteed accuracy. RSL also gives us the ability to expand our operations without worrying.”
Currently, there are three tiers of service from Rakuten Super Logistics that can be offered to your customers: Xparcel Priority, Xparcel Expedited and Xparcel Ground.
To reach anywhere in the continental US in 2-5 days, Xparcel Expedited offers fast, reliable, and secure service that previously will maybe have had to have been reserved for VIP customers or special deliveries at special rates. Now, even for a startup e-commerce retailer, passing on this premium service at no (or very low) cost to every one of your customers can be a reality.
There’s also RSL’s Xparcel Ground service for packages that comes with the quality of service you’d expect from the likes of USPS and DHL, but at a significantly lower cost than going direct, thanks to those economies of scale available to Rakuten Super Logistics. Xparcel Ground service reaches your customers safely in 3-8 days with an even lower price tag than the Xparcel Expedited tier.
Just launched in January 2022, Xparcel Priority service reaches consumers in 1–3-day transit times. The new service provides the fastest shipping times with significant cost savings for e-commerce businesses.
Regardless, average savings are — and we think these figures merit repeating — between 6% and 8%. That comes from RSL’s deep integration in the background with thousands of delivery services across the country. RSL’s algorithm sources the best possible deals for every consignment and passes on the low price it finds to you, the eCommerce retailer.
Now there is a service (or rather, two services, Xparcel Ground and Xparcel Expedited) designed for the growing and medium e-commerce businesses. This service creates a level playing field for companies to differentiate themselves positively from heavyweight competition. With delivery options and prices level, your e-commerce shop can create personalized customer experiences that consumers today demand. Being small has benefits like quickly responding to changing market conditions and even news events to carve out market share from the big players. With RSL you compete on delivery and CX, but benefit from being fast and agile, too.
There are plenty of case studies on Rakuten Super Logistics’ website, but this quote, from the CEO of an apparel company, sums up the sentiments of many: “RSL can manage [my] inventory[…] with much greater efficiency than I ever could because those are their core competencies [editor’s italics]. My strength is in building brands and running an organization. That’s where my energy and time should be focused. I need to keep my eye on the bigger picture.”
To read more into the detail of RSL and its logistics and fulfillment services, we urge you to download this whitepaper to see for yourself how a big business is, for once, on your side. Say goodbye to being treated like a second-class citizen by the big carriers and learn how to benefit.
With the success of Xparcel Ground and Xparcel Expedited, RSL will be launching Xparcel Priority in January 2021. Xparcel Priority will feature the same shipping cost savings in a 1-3 day transit day option.