Highline Commerce local delivery program: part 1

Highline Commerce’s flagship warehouse is in Brooklyn, New York.

You’ll find third-party logistics providers in urban places like Chicago and LA, but New York City is really unique. It’s crowded, compact, and cut off from the mainland by the Hudson River.

It’s one of the reasons why Highline is so popular with early stage e-commerce brands; it’s close to where customers live and where brand operators work.

Needless to say, local logistics are core to Highline Commerce’s offering. Local logistics include:

• B2B wholesale distribution to New York City businesses
• DTC fulfillment to the 30 million residents living in greater NYC
• And receiving – from co-manufacturers and suppliers in the Northeast inbound onto Highline Commerce’s shelves.

And Getcho is Highline’s partner of choice for local operations.

DTC same-day delivery in the big apple

Same-day delivery is generally achieved in one of three ways:

1. Fulfill orders from retail locations close to customers (“ship from store”). The catch is you need to have retail locations that carry a good chunk of SKUs and some sort of store fulfillment capacity.
2. Using third-party channels like GoPuff and Amazon in select markets. The catch is that your customers shop for your merchandise on other channels; Amazon owns the customer.
3. Thirdly, you can fulfill orders from an urban warehouse like Highline - first-party all the way!

Now here’s the thing. 3pls are set up to do mass-shipping: specialized pick-pack, batched label printing, daily UPS/FedEx/USPS and Parsel pickups via truck. They use robots to sort packages into gaylords corresponding with each carrier.

So here’s how we slotted same-day delivery into this operation.

Shopify powering most DTC brands doing same-day delivery

57% of US DTC brands are powered by Shopify. Of course most warehouse management systems (WMSs) integrate with Shopify; it’s table stakes. In Highline Commerce’s case, orders flow from Shopify into Packiyo, their WMS (in fact only orders associated with Highline Commerce end up in Packiyo).

At the most basic level, you can tie Shopify shipping methods to WMS shipping services. For example, a customer sees “standard free shipping” which may map to the cheapest shipping rate between UPS and the regionals (hint: it’s the regionals). And “express shipping” might map to UPS next-day shipping.

Well, local delivery is a bit more complicated. It has to live on Shopify’s side, but only for certain zip codes rather than the entire state, which is the granularity Shopify offers on Shipping Profiles. Shopify has Shopify Local Delivery, but it won’t do:

• It’s not a normal shipping method with the typical fulfillment flow, so Packiyo and other WMSs don’t receive these orders
• Local delivery cannot be gated by SKUs (i.e. only see LD when the cart meets certain requirements), practically speaking, a core requirement
• Local delivery doesn’t use Shopify Carrier Rates meaning we can’t offer prices based on item sizes, only distance

So Getcho offers its own same-day delivery rate on brands’ checkout pages AND instructs WMSs like Packiyo on how to handle local delivery orders.

When we say handle local delivery orders we mean:

• Increase the pick priority for these orders. A typical 3pl order might be slated for a 4:30pm UPS pick-up, but with local delivery, every minute counts.
• Update the fulfillment record with a branded live tracking page. Local delivery tracking pages are really key because customers open them 4x on average and stare at them – you can see the driver moving on the map.
• Pack listeners. When an order is packed, Highline prints the shipping label which is Getcho’s cue that the order is ready.
• Contactless pick-up: the warehouse team shouldn’t need to direct couriers

1. The text2. The live tracker

Tap the tracking card to open the live tracker.

Local delivery fleet optimization

For conventional shipping, a 3pl will rate-shop a bunch of carriers and typically take the best price, perhaps optimizing for volume discounts (sending more volume to UPS to get better rates). And the shipping cost is a function of zone (distance), dimensions, service (air, ground, priority).

With local delivery we have cut out the first and middle mile, so it’s a little bit more interesting than that. Carriers like Uber Direct and DoorDash and Roadie tend to charge per mile but parcel sizing is more generous; there probably isn’t a cost difference between an 18x18x18 box and an envelope.

What’s more, there is batching calculus that saves money, especially on local carriers like Flot and DBX.

Getcho dispatches local deliveries to carriers using both a rate-shop as well as a holistic routing strategy designed to keep costs low while still hitting <2 hour delivery. Every new order might influence an existing route. It’s really fascinating.

Courier pick-up operations at a 3pl

Highline and Getcho keep it contactless. When Highline prints a Getcho shipping label for a local delivery order, it goes onto the Getcho shelving unit in a location communicated to the driver via text, and if necessary, voice agent.

When it goes on the shelf, it’s off Highline’s plate.

They know it will be picked up right away and delivered. And Highline’s brands know their customers will have a delightful experience.