Data has become a crucial part of logistics and supply chain management. On this 108th episode of The E-Comm Show, Andrew interviews Jordan of Obibox, co-founder and co-president of Obibox – a data-driven platform that helps businesses streamline their logistics operations and deliver an Uber-style experience.
From building an instant pool of delivery personnel to optimizing routes and improving customer satisfaction, Jordan will discuss how Obibox is revolutionizing the logistics data sector. This episode is not to be missed if you're looking for ways to optimize your logistics operations!
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Jordan Arshinoff Foss
Dedicated father, passionate entrepreneur and fitness enthusiast, Jordan Arshinoff Foss left his successful career to follow his dreams, launch his own company. In 2016, after noticing how quickly the ecommerce industry was growing, he launched Obibox, a technology driven, eco-friendly, last-mile delivery company. From a dream to a real business, Obibox is now among the fastest growing last-mile delivery companies in their space.
Transcript:
Jordan Arshinoff Foss 00:03
So it's so important that in e-commerce brands aligns themselves with a really strong logistics partner. And that aspect is oftentimes overlooked at the end of the day
Andrew Maff 01:03
Hello, everyone and welcome to another episode of The E-Comm Show. I'm your host, as usual, Andrew math. And of course today I'm joined by the amazing Jordan, who is the founder of Obibox Jordan, how're you doing today? Ready for good show.
Jordan Arshinoff Foss 01:15
Very good. And thank you so much, Andrew, for having me.
Andrew Maff 01:18
Miss super excited to have you on the show. I love to do the stereotypical thing and let you kind of kick us off. Tell us a little bit about you know, your background and obviously more about Obibox. We'll take it from there. Okay.
Jordan Arshinoff Foss 01:30
Sounds good. So, a little bit about me. I spent a while I'm, I currently live in Montreal, Quebec. I am father of a very quickly growing three year old. So I added that to the entrepreneurial journey to become a dad thrown all that happily married, worked 17 years in the corporate world and decided to launch my own business with First of all, we were myself and a co founder. And then we were joined by two other co founders down the road. So today, we're actually co four co founders of of Obibox. But yes, six years ago, I left the a well paid corporate position with great benefits and high salary and everything that you could dream for to jump out of the airplane on my own and build a parachute as they fell, which was called the Obibox.
Andrew Maff 02:18
That's, that is how it always is. And that is very, very good way to explain how it feels. So tell us a little bit about Obibox like it just pretend no one knows anything about it? What's the process behind it, who you're working with? What's the overall goal?
Jordan Arshinoff Foss 02:34
Fantastic. So when I decided to start a business, I wanted to start a company in a sector that was really moving. And so me and my initial co founder, Paul, we sat down and we looked at various industries. And we saw that the E commerce sector was growing exponentially year over year. So on one side, you kind of had Amazon that was dominating the space, growing rapidly worldwide. And then you had everyone else. So you had the Shopify stores, Magento stores, Wix. And then we said, okay, ecommerce is really growing, but where are the main pain points within that sector. And we kind of divided the E commerce sector into three main components. So the first component is the whole online aspects. So the stores, the marketing, the branding, the products that are sold, the descriptions that that are linked to the products. So that's sort of the whole product side. The second step, once a purchase, once a product is purchased online, it's the fulfillment aspect. So once that purchase is product, it needs to be put in a box with a label and packaging and whatnot. And then the third step, that product needs to be shipped. So where we saw the biggest pain point within that flow was the last step. So we looked at the last mile last mile logistics side of econ, and realized there's a huge opportunity here, there's a lot of players that are kind of deconstructed so we could probably have an opportunity to create a company that could offer a last mile logistics solution. And that's what we did.
Andrew Maff 04:02
Beautiful. So my background is very much in the E commerce marketing side. And then when we get into like, operations, inventory fulfillment, I am useless. So gonna ask you some rookie questions here. So obviously, the last mile side essentially being literally what it is, which is the person who's basically dropping the package off at the at the customer's house or their apartment or something like that. Right? So explain to me once an order is placed, you know, comes out of someone's warehouse. Are you taking it directly from the warehouse? Are you is it going into you know, a FedEx ups? I'm like that, and then you're picking it up from there, like, what does that process look like?
Jordan Arshinoff Foss 04:40
And that's a really good question. So from a shoppers perspective, the last mile segment looks pretty simple, right? I mean, the parcel is put in the box and then needs to get to your doorstep. So it looks like it's pretty easy, but in actual fact, what we've realized after six years of trial and error is that there's six key stakeholders For a last mile logistics operation to work properly, so you have the shipper. So in order you have the shipper, the middle mile carrier that picks up all of the parcels in bulk at the final point of packaging. So whether it be the shippers location or maybe a third party logistics, that's, that's fulfilling the orders for the Econ merchant. So you have the shipper, the middle mile, sorting facilities, then the last mile partner, and then the recipient. And throughout all that you need a system that can optimize routes, can can have real time Key Performance Indicator tracking as well. So what we realized was we needed to create a technological ecosystem that basically linked those six key stakeholders together to make sure that everyone was properly served. Because at the end of the day, what the recipient wants to know that online shopper wants to know what time the order is going to arrive at their place, that it's delivered on the right day, the right time. And that the right instructions are followed right up until the last step. And it's so important because in any commerce merchant that goes into that, that puts all sorts of energy and effort into positioning their brand, sourcing sustainable elements to create their products, then they put all sorts of effort into their packaging, maybe even a personalized note. And then afterwards, their shipping partner drops the ball and offers a horrible experience, that online shopper is not going to buy from that brand again. So it's so important that that a an E commerce brands aligns themselves with a really strong logistics partner. And that aspect is oftentimes overlooked at the end of the day.
Andrew Maff 06:36
Yeah. How does that work for different types of packages? So obviously, you know, you've got stuff that's like massive and it's extreme, they don't they consider overweight or oversized, then you've got stuff that's got to be in a cooler are kept at a certain temperature, like how does that type of specialty box and work.
Jordan Arshinoff Foss 06:54
So we've kind of broken down the the e Commerce Industry into three main segments. And these are actually the three main segments that Obibox has, has grown to be to be quite proficient. And so we deal with business to business, B to C food. So you mentioned you mentioned freshness, and I'll circle back on that in a second. And then B to C E commerce. So that's the standard sporting goods, baby apparel, toys, essentially anything that you can buy online that's putting the Flexi Packer in a box. But if I circle back to that second segment that I mentioned, the b2c food sector, it's a bit of an interesting segment, because we all know of the meal kit companies that are out there, so they're ready to cook, ready to eat, I mean without mentioning the names, but I mean worldwide, that's also an industry that kind of popped up and follow the same trends of of the e Commerce of the E commerce sector, it just kept on growing exponentially. But ready to ready to cook ready to eat means that everything that's picked up today needs to be delivered tomorrow, because otherwise, the ice pack melts, the dry ice evaporates, and the product is lost. So we build our operational procedures and also our technological stack based on the needs of that particular industry. And within that particular industry, if you want to succeed, you have to offer a 99.5% success rate success rate means on time in full instructions followed. So that's where we started. So once we felt that we could satisfy the needs of that particular industry segment, then we kind of offered the same type of SLA to the the b2c E comm guys and the b2b guys as well.
Andrew Maff 08:33
Beautiful. So let's go through that. That overall process again, right, so you mentioned starting off with supplier going through the middle mile, that kind of stuff. So at what point do you guys take over? And then is it up to who's hiring you? Is it the E commerce sellers hiring you? Is it the middle mile, like what's what is that work? And
Jordan Arshinoff Foss 08:55
we deal directly with the shippers. So essentially, we take that that whole sort of flow that I explained before shipper middle mile sorting facility last mile, and then recipient and then that oversight layer, that and I call it an oversight layer, it actually is kind of the core of the engine. So it optimizes the routes and also offers real time key performance indicators regarding where parcels are at and if they're on time and whatnot. We take charge of all of those different partners within our technological ecosystem. So we hook to the shippers and then offer them essentially in a white glove Uber style delivery experience for all of their their e commerce customers.
Andrew Maff 09:36
Beautiful. So that information is fed back into whichever platform they're in, let's just say like a Shopify, and that's essentially what keeps up to date, all the tracking and where things are at and if it's been delivered and all that fun stuff. Exactly. Beautiful. How did you come up with this? What were you doing before this?
Jordan Arshinoff Foss 09:53
It was completely different and maybe there's a bit of self reflection there of becoming less relevant I was in a very traditional industry that hadn't changed in the past 100 years, it was in the world of industrial packaging. And I mean, that's an industry that's very traditional, hasn't changed. And I was 35 years old at the time, and I was just watching, you know, the world, the world evolving really quickly. And my co founder is a tech guy. And so kind of back to the origin story, when I said, we were looking at an industry that was really moving, we also wanted to find an industry that had a problem that could be solved with technology. So we knew it had to be something that was growing quickly, or there were some major pain points, but also that they could be solved with technology. And again, maybe it's just me that wanted to make sure that I stay relevant and, and whatnot. So I wanted to kind of jump out of a traditional industry and jump into a tech focus that kind of cutting edge logistics state of the art sector. So yeah,
Andrew Maff 10:51
so it's a very interesting jump you took there?
Jordan Arshinoff Foss 10:55
I thought I knew you don't know what you don't know. And I thought I knew a lot more six years ago than I realized, I don't know today.
Andrew Maff 11:03
It's you and me both fan. Alright, so the one thing I do know as well is that you guys have been growing like a weed. So you're not the only one out there. I know that. So what is what if, without telling your competitors, obviously, who maybe are listening to the show? What, uh, like, what's what's helping that what's what's fueling all that growth?
Jordan Arshinoff Foss 11:29
Well, so and that's an interesting question. And our competitors within our local spaces, they know who we are. So I would say, it's, it's interesting, because it almost comes down to the company's DNA. So I've been talking a lot about technology. And oftentimes, what you'll see is when a company or when someone starts a transportation business, they'll start off in a more traditional way. So they'll start off by a couple of trucks, managing their customers through phone calls, and Excel spreadsheets and whatnot. And then at some point, someone will come to them and say, hey, you need to offer a sexier tracking experience. So they'll go to a tech company that offers a tracking experience. And then they'll kind of hook the tracking software into their flow. And then they'll realize, Okay, we have so many drivers on the road, we need to build, we need to get an app that can manage the drivers, we need to get a routing system that can manage the routes. And so the lead of creating an integration layer with all sorts of external SaaS products, but they're still a transportation company, using software to fulfill the needs of the different stakeholders that I've been mentioning, ever since before. But we started off saying, we're going to build our technology from scratch, from ground up, it's going to be more expensive, it's going to be pretty difficult. But we're going to maintain 100% control over the user experience. And by user experience, it's not just the shippers experience or the recipients experience, it's also the drivers experience, the sorting facilities, it's the way that we manage sorting facilities, the way that we manage our middle mile carriers. So the fact that we control everyone's experience from A to Z, the fact that we can transfer the information of each individual parcel through each one of those platforms in real time, gives us the ability to to offer a way, again, sexier experience to all of those different end users that need to be a properly service within our technological ecosystem. So we are a tech company first, and operations company second.
Andrew Maff 13:26
Gotcha. Okay. So, again, novice question, I apologize. The so let's say I'm a Shopify seller. And, you know, I'm trying to, you know, figure out fulfillment, and how can I make sure my customers get everything on time, that kind of stuff? Why would I go to you, as opposed to dealing with like the FedEx is UPS isn't all that fun stuff of the world.
Jordan Arshinoff Foss 13:48
We're faster, or very cost efficient. The transparency in terms of how we are, I should say, the customer experience that we offer the online shopper. So if you receive a parcel throw of you box, you're actually going to have an Uber style experience. So you're going to be able to track the driver in real time communicate with the driver to update delivery instructions. So we've really built all of our different platforms based on real time on real user feedback, because we kind of grew with our customers. So you really get again, a white glove experience but at scale because we're using technology to offer it. And also, what we've started pushing on really hard over the past, I'm gonna say 18 months at this point is is reduced our carbon footprint. So within Quebec, we were one of the first companies to have electric vehicles on the road at the scale that we did so for a small business. Last year we purchased 21 electric vehicles. And at this point, now we've started to push our delivery partners towards electrifying their own vehicles, and we're a little over 30% right now of our of our parcels are delivered delivered in electric vehicles. So sustainability as well as a strong company. Only two of our of our core values.
Andrew Maff 15:01
Beautiful. How does that work from like a logistical standpoint of like, Don't the electric cars like die after like half a day? Or do they have to stop and charging? Like, what's that? I'm just completely off topic but super curious.
Jordan Arshinoff Foss 15:15
No. And that's, that's a really good question. And one of the reasons why we consider ourselves an acid free company. So again, going back to those different stakeholders that I've been mentioning ever since before, it's basically all partners that were that we're managing within our technological ecosystem. But then I just mentioned that we own 21 electric vehicles. And the reason why we purchased 21 electric vehicles, it's because we see the way that the industry is shifting, we see that more and more consumers are allergic to greenwashing. So they don't want to just hear about what great initiatives companies are doing to try to reduce their carbon footprint. They want to see tangible actions being taken. And so as we see the industry shifting towards more and more electric vehicles on the road, we realize that our routing software needs to be able to manage the constraints linked to managing a fleet of electric vehicles, which means managing the autonomy of the vehicles, managing the charging stations, managing a checking how weather affects autonomy, how does weight affect autonomy, the type of driver as well. So we said what better way to understand specifically what constraints we need to hard code into our routing software to be able to better support our our delivery partners down the road, then to own a fleet of 21 electric vehicles, and run them for 18 months. So yes, in the middle of winter, we had a couple drivers phoned us up and say, hey, the battery's dead? Can you Can I get a tow truck? Or can you come and boost me? Because we kind of had to explain? Well, that's exactly how it works. So So yeah, we learned a ton over the past 18 months running electric vehicles.
Andrew Maff 16:51
Interesting. Oh, that's pretty cool. What, um, the Uber thing is so interesting to me, right? Because like, as if I'm purchasing a package, and I really want to know, like, where is this thing, like, super excited for it to show up? So you're telling me the way that that technology works, it's just as if I were, you know, calling an Uber driver, I can kind of see where they're at, and then obviously, get some kind of notification and when it's been dropped off? And that whole thing, correct?
Jordan Arshinoff Foss 17:19
Oh, yeah. I mean, we spent a lot of time deconstructing the the real last mile experience. So from the moment that that so forget about all the other steps I was mentioning before middle mile and all that, from the moment that the parcel leaves the final sorting facility and is on route towards the online consumer or the online shopper. What type of information do we need to communicate it what step so off the bat. And that's actually it's a bit of a, it's kind of interesting, because sometimes you over manage your customers and create false expectations. And I'll explain, if if, if an online website promises delivery, let's say next day delivery between seven o'clock in the morning at five o'clock in the afternoon, and then when our truck leaves the warehouse, it gives them a 60 minute time window. So that parcel will be there between 11 and 12. And then there's a bit of a delay, and finally, it shows up between 12 and one. And then all of a sudden, the customer is unhappy, because they say Oh, well, you said between 11 and 12. But the the initial shipper had promised between, you know, seven o'clock in the morning and five o'clock at night. So it's kind of interesting that we have to reconcile our delivery promise with what the customer with what the shipper is promising on their website. But ultimately, we offer 60 minute time delay time windows, and then right up to the point where when the the the customers the next delivery, you can actually track your driver in real time. And like I said before, communicate with your driver, update delivery instructions. And then we manage the final 20 meters. And that's when the driver shows up in front of the house, there's a whole bunch of things that needs to happen for the experience to remain white glove, including following instructions, walking up the driveway and not through the flower garden, making sure the parcel is hidden, making sure that the proper pictures are taken that the proper note is entered into the application. So So we work really hard on making sure that each one of those steps are followed and audited as well.
Andrew Maff 19:11
How does that work from a cost structure? Is there a recurring fee of some kind that's in place to leverage all the technology? Or is it kind of built into the shipping cost? Is there just shipping costs? Like what what's that price structure look like?
Jordan Arshinoff Foss 19:25
So from a shippers perspective, we are offering a delivery service, a delivery service with all of the components that I was explaining before, so we keep our costing pretty simple. Example there's no I mean, what we've seen in the industry, oftentimes there's a lot of hidden fees, residential delivery, Oh, you want a picture with that it's an extra 75 cents or $1.50 or whatever. So as it's all pretty straightforward. It's, here's your here's your price per zone. If your parcel is within this size range, and our size ranges are pretty big. If it's within the size range, this is how much it's gonna cost you So it's straightforward. And that makes it easier also for the the E commerce shipper to build their own cost structure, and then use it as a marketing tool as well and say, Okay, if you purchase for over $99, it's free shipping. And they know that the cost that they're absorbing is a $7, straight and not going to be $9.50 at the end of the day, because there were hidden costs. So we keep everything pretty straightforward and the way that we manage internally, it's a little bit different because it is a, it's a managed logistics fee. And so it's a little bit like Uber. So we have our top line revenue, then we pay all of our partners that we have our net revenue. And that's what that's what funds are our r&d, and our technological development, and also some of our operations as well.
Andrew Maff 20:43
Beautiful. I love the cost structure, because I know that that's the biggest, again, I'm on the marketing side, so very rarely have to deal with it. But I hear about it all the time, which is just shipping costs are just there's surprise stuff all the time, there's stuff you expect to stuff you don't expect, and just stuff comes out of left field and ends up completely ruining people's bottom line. So that's a total is a very commendable approach to take. And I'm sure a lot of people appreciate that.
Jordan Arshinoff Foss 21:06
It's actually in to go back to your question before, it's probably one of the reasons also why we're growing the way that we are.
Andrew Maff 21:12
Yeah, I bet because it makes it predictable. Sometimes I find that that to be one of the most interesting things is that you'll find these different businesses, whether they're apps or services or anything, where they'll have relatively low cost, but then they nickel and dime you throughout it and becomes completely unnecessary. Then you have others were like, Yeah, costs a little bit higher, but at least it's predictable. And you know, what you're getting, so you're not like surprised one month or something like that. So I completely, I appreciate the approach.
Jordan Arshinoff Foss 21:40
And what I find them i It's It's, I find it a pretty horrible practice, actually in the shipping industry. Because what happens even for us when let's say we're pitching to a new customer, and we present the pricing grid, and then they say, Oh, well, you guys are whatever 20% higher than what I'm currently paying. And then we have to say don't don't look at your quote, look at your actual invoice, and then come back to us and say, Well, you guys are actually 25%, lower, we see that and because we're showing you the cost all in and you're not looking at the cost all in. So it's really important to be comparing oranges with oranges when we're at that level of discussion. But it sometimes makes my job a little bit tougher, though for sure.
Andrew Maff 22:18
But beautiful, Jordan, I really appreciate you having on the show. I don't want to take up too much of your time. I know you're super busy. But I'd love to hear a lot where they can find out more about you where they can find out more about Obibox and we'll wrap it up from there.
Jordan Arshinoff Foss 22:31
Absolutely. So my personal LinkedIn is a good source of information. The Obibox LinkedIn is not too active right now but will be become very active very soon. We do have a website www.obibox.com. You can write to anyone us any one of us. So myself, Michael, my co founder, Paul, my co founder and FrostWire, my other co founder, our first name at Obibox.co as well. And at this point, we have a pretty large team of internal sales guys that can answer all your questions and otherwise I'm happy to do so.
Andrew Maff 23:02
Perfect. Jordan, thank you so much for being on the show. Obviously everyone who tuned in thank you as well please make sure you do the usual and rate review, subscribe all that fun stuff or head over to whichever podcast platform you prefer. or head over to theeccomshow.com and check out all of our previous episodes but as usual, thank you all for joining us and I will see you all next time.
Narrator 23:22
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