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August 3, 2015 Issue

The Most Powerful Name In Corporate News and Information


Automated eCommerce Platform that Matches Purchases with the Optimal Shipping Solution



Jeremy Bodenhamer

CEO, Founder




Interview conducted by:

Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – August 3, 2015


CEOCFO: Mr. Bodenhamer, what is the vision and the concept at ShipHawk?

Mr. Bodenhamer: The vision and concept are slightly different things. When you go online to make a purchase, there are two transactions that have to occur. One is payment processing and the second is transportation. Now, no matter what site you go to, the payment portion of the transaction is always the same. It does not matter whether it is PayPal or Visa. You trust these companies to go into your bank account many times and take out just the right amount of money and transfer it to the seller. It is very, very consistent. When it comes to receiving the goods the transportation element, it is never the same. Different service times, different quality of service providers, different prices, sometimes there are no prices, or you do not trust what you see; it always impacts your service or your purchase decision. Over four trillion dollars is left abandoned online in shopping carts each year. Six of the top eight reasons are for shipping, but no one is sitting here blaming Visa for that abandonment. Therefore, our vision is to be the standard for use on any eCommerce platform, and trusted by the buyers on any platform, to match their purchase with the optimal shipping solution.


CEOCFO: How can you accomplish that?

Mr. Bodenhamer: That is very difficult. I discovered with the last company I owned that nobody could tell you what it costs to ship something. That was the number one reason I started this business. Therefore, we started with a calculator just to answer that simple question— what does it cost? We provided rates based on real items, not based on this kind of crazy language the carriers speak. When you or I are going online and we want to buy a lamp or a skateboard or a table, we want to know what is going to cost to ship a table, not what it is going to cost to ship a 48X48X48 cube that weighs 227 pounds and is freight class 225.


After building the calculator, we knew that this technology needed to be accessible in eCommerce platforms, in the shopping cart itself where transactions were actually occurring. Therefore, we built APIs to help retailers access the calculator. Then we started building robust packing algorithms so that we could assemble orders instantaneously. We could put single items in the most optimal box or multiple items in multiple boxes, and multiple boxes on multiple pallets and assign them to the right trucks. It gets really complex. However, these are the nuts and bolts of how we do it. We just look at each individual problem that prevents these shipping companies from being able to accurately price and with technology, we just buckle down and solve those problems.


CEOCFO: Who is using your services today? What types of companies?

Mr. Bodenhamer: Our focus so far has mostly been in the furniture and home décor space. We have a bunch of furniture companies and auctions and antique resellers and that type of clientele primarily, at the moment, and we are expanding.


CEOCFO: Are you working directly with a home décor company as opposed to working with a platform that is providing their eCommerce or are there two ways that you could engage?

Mr. Bodenhamer: That is a great question. We work directly with the company in all cases. However, how that company accesses our technology may vary. They may access it via a custom API if they have a custom platform that they have built, or they may access it via an extension, like a plug-in to Magento or Shopify or WooCommerce, if they have built their online presence on one of those platforms.


CEOCFO: Would a company tell you, “These are the truckers we want to use, these are the truckers we could use,” or are you providing them with some options? 

Mr. Bodenhamer: Many customers initially call us because they want access to more carriers. They always think that more carriers is the answer to lower prices -- and sometimes it is. Sometimes it is not. However, the direct answer to your question is that we do both. Most customers will come to us and say, “I have this carrier that I really like,” and sometimes they say, “I also have this carrier that I do not really like. I want to make sure that I keep getting rates from the guy that I like,” and that we also return rates from other carriers side by side so that each order is being optimized, so they are always getting the best deal.


CEOCFO: Each purchase is customized with a number of rates from a number of different carriers?

Mr. Bodenhamer: It depends on the commodity type. There are different carriers that will take different types of shipments. The easiest example is someone like FedEx or the US Post Office is traditionally only going to want to take parcels. Therefore, if your item gets too big it is not going to work with their infrastructure. In that case, you have to go to a freight company, or, if it is furniture, you have to go to a furniture company. If the furniture is used, there are certain used furniture carriers. If it is new, you go to your new furniture carriers. It gets very complex, even for the new guys, even down to separate carriers for the line haul and the final mile. A bunch of people could order some furniture and all of that furniture is delivered to the port in LA, and then a line haul company will take that furniture throughout the country and drop it into a different carrier’s ecosystem that does those final miles of delivery. Our system basically organizes all of that in real time and then selects the best opportunity based on what that customer puts in his or her shopping cart.


CEOCFO: Does the customer have to make any choices?

Mr. Bodenhamer: That is up to the seller. The seller may only show one option, or the seller may show no option. They may just say shipping is free, and it ships as it ships. They may show a cheap ground service and overnight or some sort of express service if they want to give people a faster option. It really depends on the seller.


CEOCFO: Have businesses been looking for a better way? Do they even realize it might exist? How do you get them to know?

Mr. Bodenhamer: Sellers are always looking for a better way, however, they aren’t aware of the options available to them. Many companies will call us or look for other solutions just based on price. All they care about is getting the cheapest price. Once they get the cheapest price, if they are working with, for example, a low-quality carrier, the customer may have exceptionally high damage rates and they may have to start from scratch again. Now they are looking for the most value, which is the best price at a service level that is not going to damage many items. There is a sweet spot where you have certain shippers out there that provide really high-quality service. They take care of the goods and they are reasonably priced. Most companies, after enough time, end up with that type of combination service/price solution. From there, the companies try to use volume to drive prices down.


However, the right solution depends on the problem that is in front of them today, and there are so many problems in our space. Pricing is one of them, Service standards and damage are two others, but there are many more. It just depends on what they are experiencing today and what their customers are telling us based on what solution they are looking for. Whether their businesses are price and/or service driven, most companies still approach fulfillment the way it's always been done, by getting recommendations about carriers from their industry connections and then calling around to get the best deal. Shiphawk's biggest challenge is getting companies to know there's a better option, a technology solution that offers the best shipping options & rates, automates processes, and provides transparency from cart to customer. We still have a lot of work to do to build that awareness in the industry.


CEOCFO: What else are you providing? I see on your site that you can track all orders in a unified dashboard. What are some of the bells and whistles that you provide?

Mr. Bodenhamer: The dashboard is definitely one of the primary benefits. If you think about it, it is like a skin over the technology. It is a single interface that allows them to see what is going on inside their supply chain. It does not matter if they have loads in transit with dozens of carriers. They can see and manage all of that from one location. Does that include tracking? Absolutely! The customers’ data, all of the paperwork, any claims information; everything can be managed from this one dashboard. That is definitely something that is highly unique to ShipHawk. Although, to be honest with you, our software is unique even without the dashboard, so I like to think that everything else we add is either a bell or a whistle.


CEOCFO: When a company is talking with you do they understand easily what you are doing and the value or does it take some explaining for them to see how it can really make a difference?

Mr. Bodenhamer: The industry is changing so fast these days that it is hard for anyone to keep up! Most people that contact us are very educated. However, when we dive into the details there are always things that we can bring to light. For example, one ecommerce customer contacted us wanting help with their parcel shipping and we asked for some sample data so that we could evaluate what they were doing. They gave us ten thousand transactions. We pulled out the first item on the list and we analyzed this one item. In this customer’s distribution center they have eight boxes that they stock. This one item was packed in five of those eight boxes with a chargeable weight difference of thirty pounds, total. This means that they were losing money on half of that item’s orders. While this company had contacted us just for generic parcel help, what we found in doing an analysis is that they had no standardization in their distribution center and so the guys pulling these items off the shelf are throwing them into any box, causing the company to lose money. We help companies find inefficiencies they may not be looking for, and often encounter enormous amounts of money left on the table in the process.


CEOCFO: Where are you in development and commercialization and usage? How far along is ShipHawk?

Mr. Bodenhamer: I’d like to think we are well underway. We have a handful of high volume customers using our API product. We have a lot of customers using our dashboard product. So, we have significant volume going through our system every day and customers realizing tangible value. We are now expanding into new verticals that our technology applies to. That is because we have had so much success where we started. I would say that our future is bright


CEOCFO: What have you learned so far? What has changed from the initial thoughts?

Mr. Bodenhamer: Everything has changed.


CEOCFO: Did you know that was likely to happen from your previous ventures or are you still surprised?

Mr. Bodenhamer: No! I have started companies before, but nothing of this magnitude. The last company that I ran was a failing company I bought. I built it up and sold it, and it is so much easier to walk into something that is already broken and see what doesn’t work than it is to create something from nothing and try to guess at or set up systems to indicate what will work. I think one thing that I have learned is that everything will change, that we are making the best decisions that we can make today based on the data that is available today, and that sometimes we have to sprint and sometimes we have to jog and sometimes we have to walk. We just have to make sure that we are always preparing for that next phase of the company. That is because every single day that we walk in there are different demands, different customers and different rules to live by. I mean, everything changes every day.


CEOCFO: Are you funded for your next steps for moving into new industries? Are you seeking partnerships or funding?

Mr. Bodenhamer: We closed a Series A in October of last year. We are well capitalized for all of the moves we are making right now. Our revenue growth has also allowed us additional flexibility, which has been really nice.


CEOCFO: Why should people pay attention to ShipHawk? Why is it an outstanding company?

Mr. Bodenhamer: Truthfully, because we are a team that is doing the hard work that no one else has wanted to do. Most of what we do is not rocket science, it is just incredibly difficult. There continue to be inefficiencies in distribution and shipping because nobody has conquered the hard problems. The ShipHawk team came from the logistics world so we understand first-hand the pain retailers and sellers face in shipping goods.  We are looking at each of these hard problems one by one and figure out how to solve them in a way that creates a better experience both for buyers and customers.”


“Whether their businesses are price and/or service driven, most companies still approach fulfillment the way it's always been done, by getting recommendations about carriers from their industry connections and then calling around to get the best deal. Shiphawk's biggest challenge is getting companies to know there's a better option, a technology solution that offers the best shipping options & rates, automates processes, and provides transparency from cart to customer.”- Jeremy Bodenhamer









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