INSUBCONTINENT EXCLUSIVE:
The world has gotten so much faster
Amazon has made two-day shipping the standard and same- or next-day shipping commonplace
And that doesn’t even include the collection of on-demand players that can get us everything from groceries to alcohol to services like
concierge storage and in-home cleaning with the press of a button.But the logistics around same- or next-day delivery are incredibly
complicated, which usually means that only the biggest, most successful brands and platforms can pull it off.Enter Ohi.Ohi was founded last
year by Ben Jones, with a mission to democratize e-commerce by offering Amazon-level speed to smaller brands
The company today announced the close of a $2.75 million seed round led by Flybridge Capital Partners .Ohi partners with landlords to turn
what would normally be leased as commercial retail property or office space into micro-warehouses within major cities
The company then offers those warehouses on flexible leases that can be as short as three months, which help D2C brands distribute their
inventory and power same- or next-day delivery of their products
Ohi employs 1099 workers to handle pick and pack at warehouses, and partners with Postmates and Doordash for last-mile courier
services.Eventually, Ohi has plans to turn this into a full-fledged platform, paying landlords based on volume
For now, however, the startup is doing traditional leases with landlords, taking on more of a financial risk with the spaces, as it scales
up the brand side of the platform.Ohi charges brands a fixed monthly access fee to the platform, which starts at $750/month
More expensive tiers unlock premium intelligence features around matching inventory to warehouse location, as well as access to more spaces
At the transaction level, Ohi asks for a fee of $2.50 for pick and pack.Jones says that delivery is actually a higher cost for brands than
storage, and that same-day shipping can cost upwards of $50/package for a brand, with same-day pick and pack costing about $10/item
The hope is that Ohi can bring down the price of same-day and next-day delivery by using this Ohi network of commercial space, pick and pack
and courier services to compete with Amazon.Moreover, Ohi believes that the platform can go well beyond bringing down the price of same-day
The company says its brands are also seeing a decrease in cart abandonment when customers see that same-day or next-day delivery
option.Plus, through the data it collects by handling fulfillment for brands, Ohi expects to be able to use its tech to predict demand based
on geography and category, helping brands understand their own customers and customers shopping in their particular category.“There is a
lot of positive momentum behind what we’re doing,” said Jones
“Every brand we talk to knows this is the future.”Jones came up with the idea for Ohi after suffering a serious back injury that left
him for more than a year unable to get around easily or carry things
This forced him into a situation where e-commerce was his only option for just about everything
Many of the orders he placed offered three- to five-day shipping, leaving him waiting for what he needed.He started to investigate how a
service could democratize the convenience of same-day and next-day delivery for brands and their customers
And Ohi was born.Ohi currently offers its service in Manhattan and Brooklyn in New York City, and is launching in Los Angeles this
week.“The greatest challenge we face is how to scale quickly without making mistakes,” said Jones
“It’s not quite as simple as a piece of software that has one-to-many distribution
We’re actually holding brands’ inventory and there’s a physical aspect to this business that makes it more complex
Making sure we can scale that efficiently without making mistakes is going to be one of the biggest challenges.”
