- 24 February 2016
- Transport / Logistics Services
US same day delivery startup Deliv has announced it has a new investor – United Parcel Service (UPS). The company, which specialises in getting goods from brick and mortar stores to peoples’ homes within a few hours, has said that UPS formed part of its latest USD $28 million funding round and will take a seat at the company’s board of directors.
According to the Wall Street Journal this will take the four year old company’s funding to something over $40 million yet it is in a very crowded marketplace. Delivery within the hour seems to cost customers around $5, and as a result the margins are wafer thin. Add to this, competition from giants and super giants such as Amazon and even the US Postal Service and Deliv is up against companies that can afford to run at a loss just to take on their smaller upstart competitors in the mix as well. eBay was one such ‘upstart’ to try and fail in this sector, so even companies with piles of money can fail in this sector.
Deliv however has a strong and wide customer base, counting over 4,000 retailers on its books. The company’s Chief Executive Daphne Carmeli said, “Since you’re fulfilling orders from local stores you can get it to customers pretty quick!” Though she refused to talk hard figures she did say that the business is making a profit in around 45 of the areas it serves.
The internet has long been seen as the Wild West of commerce and as one area matures such as the retailing itself, so other facets of e-commerce are prone to cutthroat, cutting edge innovation. It seems that led by the US, delivery seems to be in this phase now with wild sums of cash being poured into new ventures, and not all those investing walking away with buckets of cash at the end…