Though supply chain turmoil has brought its fair share of uncertainty to brands in 2021, the disruption has delivered an opportunity for third-party logistics (3PLs) and fulfillment providers to expand and innovate for these sellers.
After raising $15 million in new funding, end-to-end logistics, fulfillment and order management provider MasonHub has expanded its platform and services to satisfy the growing challenges its customers face. The additions include building out a new distribution center, building out its technology and engineering teams, and in turn deploying new features including split orders and drop shipping.
As part of MasonHub’s business model, retailers can ship their stock directly to the company’s fulfillment centers, where its order management system tracks inventory across all channels, down to the SKU level. MasonHub then fulfills orders for the retailer, which can access a dashboard that keeps track of multichannel inventory, pick-and-pack statuses and carrier updates.
In interacting with retail brands throughout the tumultuous year and a half, CEO and founder Donny Salazar understood that there was a massive uptick in consumer demand for same-day and next-day delivery. Yet with so much of those demands coming at a hefty price for brands, he identified a need for solutions built on strategically placing inventory at the right place at the right time.
To help fulfill that need, MasonHub opened a 200,000-square-foot East Coast fulfillment center in Wilkes-Barre, Pa. in June, tripling the company’s fulfillment capacity and enabling two-day ground shipping to 90 percent of U.S. consumers.
The second fulfillment center comes as brands worry about two major problems: rising shipping costs and speed-to-consumer. With these new bicoastal fulfillment capabilities alongside the technology’s intelligent routing logic, brands can split orders based on inventory availability and location. If the brand wants to prioritize speed and an order contains a backordered item, the available item will ship first. This way, the shopper doesn’t have to wait for the full order to come in stock before any of it heads their way.
In an era when out-of-stocks are becoming more problematic, particularly as the holiday season kicks into gear, this can benefit brands, particularly West Coast companies that want to get more products to East Coast consumers and vice versa.
The added feature also can mitigate risks for the carriers in MasonHub’s distribution network, according to Salazar.
“There’s just a lot of delays and capacity constraints from the carrier perspective,” Salazar told Sourcing Journal. “By splitting inventory, you’re mitigating your risk and basically dropping orders into the carrier networks, and you’re not logjamming. So for instance, if you’re in one area, and the carriers are having capacity challenges in Southern California, by splitting your inventory, you’re also mitigating the risk that your carriers are going to end up over capacity.”
The cloud-based third-party logistics (3PL) provider also recently integrated with electronic data interchange (EDI) provider SPS Commerce to support drop shipping capabilities, leveraging APIs to enable brands to sell in different retail channels. That way, a retailer transmits an order directly to MasonHub, which can then ship the product using its branding, shipping and packaging requirements.
“What we love about that is that we open up several different new channels to our brands to be able to transact,” Salazar said. “The reality is that it’s no longer about just selling your product on your dot-com site or your store. You have to be wherever the customer is, right? And so that could be on another retailer’s website. It could be on another marketplace. And so what this product enables us to do is open up these different channels for our brands to be able to transact on these marketplaces.”
By extending into different retail channels, Salazar and the MasonHub team want to help consolidate many of functions that 3PLs provide, especially as brands patch together numerous companies on their back-end at once. In many cases, these tech providers, may have expertise in one channel, but not several.
As brands seek to unify their systems and send shipping and order management information to all parties, MasonHub is currently developing another product helping brands integrate with multiple platforms across different functions, across the back and front ends.
“We can push and pull information to all the different systems that we require, be it your ERP, it could be your front-end e-commerce platform or cart, it could be a system you’re working on to help with inventory management,” Salazar said. “Because we sit at an interesting intersection of having all the data around a customer’s inventory, wouldn’t it be great if we can just send all that inventory, or data, or whatever information that you want to all the different platforms that you’re working on? What’s happening is that there’s just this massive architecture of all these different platforms, but you need one center repository of someone that can send all the data back and forth.”
Since late 2019, MasonHub has expanded from about 10 fashion clients including activewear seller Carbon38 and plus-size luxury apparel brand 11 Honoré, to more than 40, touting brands such as DTC intimates seller Mindd, streetwear label Brain Dead, sustainable apparel brand Outerknown and more.
In April, the company onboarded a head of people, Evelyn Lee, to help accelerate the hiring process at MasonHub—the business tripled its technology team in 2021, largely consisting of new engineers. And to help handle the increased scaling of both the new hires and the overall business growth, the fulfillment provider also onboarded a senior vice president of operations, Patrick Ringston, that same month.
Although the $15 million has gone a long way for the company, MasonHub isn’t on the hunt for new funding.
“However, for us, it’s always about understanding what the opportunities are, and constantly reviewing that to determine whether or not it makes sense for us to go out into the market,” Salazar said. “If there is the opportunity for us, whether it be marketing, whether it be technology, or increased capacity, we’ll make that decision to determine whether we can put those dollars to work for us.”