Locad speeds up D2C retailers’ fulfilment, shipping of orders

Shrey Jain’s startup helped Havaianas shrink its delivery period from 15–30 days to as short as 24 hours.

Entrepreneur Shrey Jain observed that many retailers have begun exiting marketplace engines like Lazada and Shopee to build their own shops and shift to a direct-to-consumer (D2C) model. Retailers who made the shift, however, are having a hard time fulfilling their orders which is why he started Locad.

The startup helps D2C retailers in two ways: fulfilment and shipping.

Under its fulfilment engine, Locad provides retailers a network of fulfilment centres which help them put the stock closer to their consumers. Currently, the startup has 20 fulfilment centres across Southeast Asia.

“The service that we provide is pick, pack, store and ship. So when the e-commerce brands sign up with us, they send us that inventory. We distribute the inventory across our fulfilment centres in the region, and our software then integrates to their storefronts to sort of process the orders and get them fulfilled,” Jain told the Singapore Business Review.

Once fulfilment of the orders have taken place, orders will be picked up and dispatched which Locad does through its shipping engine.

Jain, however, clarified that Locad does not have its own carrier, but has a network of partner carriers across the region.

What Locad does, through its smart shipping agent technology, is select from which channels and location retailers their products should be shipped, based on parameters like price, coverage, Service-level agreement (SLA), performance, and cancellations of the carrier.

“This helps our customers lower their shipping costs and provide reliable delivery to the end customer,” Jain said.

“By having a network of carriers integrated into our system, what we can do is we can play the game or play the role of an orchestrator that chooses the best man for the job. In a sense, we choose the best last-mile carrier for shipment level, and we can then make very intelligent decisions on who we ship to particular parts of it,” Jain added.

Jain said being asset-light has also put Locad in a “position of being able to scale very quickly.”

“Asset-heavy operators, which most other logistics companies are, would have to set up their own warehouse and lease the space which is very capital intensive. Whereas, what we do is that we partner with the facilities on a shared tenancy basis which in effect allows us to scale to a very local and very widely distributed system and network very quickly,” added Jain.

A step forward for Havaianas

One of Locad’s clients is flip-flop sandals brand, Havaianas.

Before Locad, Havaianas took 15–30 days to deliver an order because the brand had to manage the end-to-end fulfilment of orders on their own.

When Locad entered the picture, the brand was able to shrink its delivery period from nearly a month’s wait to as short as 24 hours.

“From paying for our own real estate, managing that real estate, hiring people to cover X square metres of that real estate — all of that has been lifted from us and now we are only looking at the cost per unit,” said Christine Brunermer, e-commerce lead at lifestyle-creation company Terry SA which carries the Havaianas brand.

Apart from saving the brand time, Locad also helped the brand with checking inventory and stock.
“Right now, what our customers see [in] our e-commerce store is consistent [with] what we physically have in our warehouse,” Brunermer said.

Fulfilling goals

With the US$13m (SG$17.30m) capital Locad has raised so far, Jain hopes to beef up the startup’s technical expertise.

“So far, we’ve spent a lot of the capital in building up our technology teams in the region to build a stronger product, to build a more robust engine, and to sort of close the feature gaps,” Jain shared.

Apart from improving Locad’s technology, Jain said he also plans to use the startup’s capital in horizontal expansion.

At present, Locad’s markets already include Singapore, the Philippines, Australia, Indonesia, and Malaysia.
Jain plans to add Vietnam, Laos, and Cambodia to its roster of markets.

“What we aim to do is to capture the growth of this shift of brands from marketplace models to direct to consumer in a way that accomplishes the goal of providing end to end fulfilment services to brands that are now transitioning from market based models to D2C,” he said.