B2B E-commerce Feature Updates Freight Insights Logistics Technology Longform

Unlocking crossborder B2B e-commerce: launching Freight-as-a-Service

In the beginning, there was nothing.

Okay, that’s not true. There was a Sears catalog. But then, for a long time, there was nothing. Brick and mortar, together with catalogs like Lands End, LL Bean, and even Oriental Trading, shaped how we bought things in the comfort of our home. 

Of course, as has been repeated ad nauseam, COVID radically accelerated e-commerce, with a 36% YoY growth in US e-commerce sales over the past year. Yes, outdoor-starved humans will click buy on anything. 

The E-commerce Enablers

The real enablers for e-commerce today are the building blocks that have been developed over the past two decades – plug and play payments, fulfillment, returns, inventory management, and more.

Each of these emerged piecemeal. Pre-Paypal, the eBay experience was challenging, to say the least. UPS and FedEx evolved to be API-first companies, enabling direct integrations into checkouts and saving the Jeff Bezos’ of the world from needing to walk to their local post office with every shipment. 

This triggered the evolution of the platform as we know it today – digital backbones that enable consumer e-commerce at scale. These are sometimes invisible, like Stripe accepting payments, Shopify providing cataloging, or Shippo providing aggregate shipping prices, or, more rarely, visible and closer to aggregators, like Amazon.com.

The existence of these Lego pieces has dramatically lowered the cost of selling, converging with the COVID-demand spike to open up a treasure trove of e-commerce. Some of them, especially on the delivery side, may have been started off lower-profile but have since exploded into mainstream visibility with a series of high-profile investments in companies like ShipMonk, Stord, and Deliverr.

B2B and Me

It took time but eventually, hitting the book button jumped over the pond as crossborder commerce grew (and not to jump forward…but it still is, with crossborder e-commerce growing 21% this year). Platforms fueled e-commerce growth, which then could spread out around the world. 

And then came B2B.

In 2018, the anticipated growth of B2B e-commerce passed the one trillion dollar mark, one year earlier than anticipated, on track to hit $3.6 trillion in 2024. While likely immortalized in investor decks around the world, it is a market segment that is much harder to acquire. B2B isn’t one category; it’s a hugely stratified layer cake of different verticals, purchasing models, and industries. 

However, it follows the same building-block patterns that B2C follows. You need to see what you’re buying, to pay, to communicate, and to ship.

So while e-commerce buyer behavior and technology helped B2B e-commerce growth, the crossborder aspect is where things fell apart.

Which brings us to freight. Finally.

One of the ubiquitous signs of e-commerce is the pile of boxes “hidden” next to your front door. You buy it online – a mattress, a six-pack of sparkling water, or glasses – and it comes to you. Massive economics of scale, of delivery vans and sorting facilities and courier networks hardened by decades of e-commerce make that happen. 

For international freight, though, it’s more complicated. There are dozens of surcharges per shipment, an average of 3 days to even get a price quote, offline tracking that pushes half of importers to use spreadsheets as their shipment management system of choice… 

It’s complicated, which means that one might fear B2B cross border e-commerce – the kind that requires pallets and containers, airlines and ocean liners – could never be low touch, scalable, resilient, and, honestly, fully global.

Luckily enough, that’s exactly what we’ve been working to solve for, oh, five years.

The Marketplace to Platform Shift

Over the last five years, beginning with a SaaS-enabled marketplace model, we’ve built the world’s largest digital freight marketplace, helping over 10,000 customers import tens of thousands of shipments, driving millions in revenue to dozens of logistics providers, and automating pricing, communication, and management on both ends to make the process smoother for everyone involved. 

Building a marketplace for freight – rather than a digital forwarder – wasn’t an obvious solution but we’ve had strong conviction in the model for a few reasons. It supports resilience at scale, surfaces the best value and capabilities, and leverages very diverse supply. As we scaled, increased investment in this same technology began to shine a spotlight on the fact that beyond buyer aggregation, the combination of our network of digitized suppliers and tooling had serious utility on the platform side. 

Enter Freight-as-a-Service (FaaS). WIth a series of a few APIs, FaaS enables any B2B e-commerce platform to integrate crossborder global air, ocean, and trucking freight. Just like e-commerce vendors leverage courier APIs, FaaS helps B2B users price out their freight options, book, and manage their shipments all in one place.

And we already know this works. We started big, partnering with alibaba.com, the world’s largest B2B e-commerce sourcing platform to power international freight pricing. And it really worked. 

Integrated freight, not a freight integrator

As e-commerce expands and the ecosystem matures, we’re seeing this demand pop up in a variety of places. When you’re a platform, a lego block, you become available for opportunities you never imagined. What I’m excited about is how we’re not in this shift alone; more logistics providers, carriers, and service providers are shifting towards an API-centric approach towards logistics. From an opportunity perspective, it’s a thrill to be opening the door for truly digital global b2b e-commerce.

Let’s do this.

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