Lost parcels and delayed deliveries are common issues in today’s digital world where e-commerce is booming and brands sell their products to global consumers through online platforms.
In most cases, merchants rely on third-party logistics companies to deliver their orders to save them the cost of creating their own in-house logistics team.
However, that often means merchants may not be able to track the passage of the parcel and by the time a merchant gets a complaint from a customer that the goods were not delivered, arrived late or were damaged in the transportation process, the brand’s reputation would already have taken a hit.
This issue was noticed by Arne Jeroschewski and Dana von der Heide, who met when they were both at DHL e-commerce. After realising they worked well together and share a common interest in helping merchants create a better e-commerce experience for their customers, the German duo got together and started Parcel Perform in Singapore six years ago.
CEO Jeroschewski had encountered this problem in DHL when he was the vice-president at Singapore Post (SingPost) eCommerce as well as the founding CEO of online retail platform Zalora.
On the other hand, Von der Heide is well known in the logistics sector as a member of the eFounder Fellowship Programme by Alibaba and an advisory board member of the German Logistics Association.
In an interview with The Edge Singapore, Jerochewski explains that Parcel Perform is a delivery experience platform that works with merchants with an e-commerce presence and logistics carriers globally.
The platform allows merchants to create unique end-to-end customer journeys and optimise logistics operations with data integration, parcel tracking, delivery notifications and logistics performance reports in real-time.
On a single day, Parcel Perform’s scalable software as a service (SaaS) platform executes over 100 million parcel updates and integrates with more than 800 carriers globally. As a datafirst company, Parcel Perform is also pioneering the innovative use of machine learning (ML) and artificial intelligence (AI) in e-commerce logistics.
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“What we do is we connect with the logistics carriers that handle the parcels of our clients — the merchants — and we grab all the information relating to those parcels, then provide the information back to the consumers too via tracking notification. The merchants will also receive this information but with further insights that they can use to further improve the services for their end-consumers,” explains Jerochewski.
There are several logistics providers out there that do provide such data to the end-consumer but Jerochewski explains that this information is shared with the end-consumer by the logistics company and not directly from the merchant.
With Parcel Perform, however, the consumer’s experience from purchasing to receiving the product is only with the merchant and the merchant’s brand is at the forefront of the whole purchasing experience.
“This is the key advantage that allows the merchant to build a better relationship and communicate with their end-consumers, which in turn could lead to retention of customers and introduction of new ones,” says Jerochewski, adding that the platform can help businesses increase customer lifetime value by up to 40%.
Tracking progress
The Covid-19 pandemic may have put a spotlight on online services and e-commerce but the way Jerochewski sees it, the pandemic was merely an accelerator of this trend which was already growing before the pandemic hit.
“Since the beginning of the pandemic, our business grew more than five times. There has been a lot of interest in our service, especially with e-commerce growing and the volume of transactions growing too,” tells Jerochewski, adding that the pandemic has caused people to have higher acceptance for e-commerce and hence allowing the industry to flourish today.
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“Just as long as e-commerce grows, our business will continue to grow hand-in-hand too,” adds Jerochewski.
He claims there are only a handful of players worldwide that offer similar services so competition in the space is not strong. Nevertheless, Parcel Perform’s approach to data management and data handling is unique and proprietary.
A good amount has gone into funding the group’s growth and improving its standing in the industry.
In its seed funding round led by venture capital firm Wavemaker Partners back on Jan 22, 2018, Parcel Perform raised US$1.1 million and was oversubscribed.
Parcel Perform then launched its Series A funding on Aug 11, 2021, which secured a whopping US$20 million ($27.3 million), was led by Cambridge Capital, Softbank Ventures Asia as well as existing investors Wavemaker Partners and Investible.
Currently, the company is profitable and is still seeing growth and interest from investors, according to Jerochewski.
“We set our hearts on building a scalable, sustainable and customer-focused enterprise software company. We grew our team to over 100 people and expanded our customer base from our roots in Asia to also working with leading brands, marketplaces and carriers in Europe and North America. Today, we are proud to support hundreds of customers by allowing them to leverage our platform as a true differentiator in their markets,” says von der Heide.
Some of the company’s notable clients include merchants such as Decathlon, Eu Yan Sang, Nespresso and Love, Bonito. Although Parcel Perform is making headway in the local and regional markets, Jerochowski notes that Asia still lags behind the US and European markets as e-commerce has been around much longer in these regions, resulting in more demanding and less tolerant end-consumers.
“Customers in Asia are still a few years behind [the US and Europe] when it comes to expecting a certain quality with their online purchasing experience. And their expectations are important because the merchant will only change if the consumers decide to take action against having a bad experience,” says Jerochewski, who predicts the region will see merchants investing more in the online retail experience over the next few years as customers become more demanding.
Delivering success
Since Jerochewski has identified the US and Europe as key markets, it is no surprise Parcel Perform is aiming to expand its presence in these regions as well.
Most recently, Parcel Perform announced that it has increased its footprint in the US and has opened its first office in New York City, enabling the company to provide on-site servicing of existing and new customers within the US, Canada and Latin America.
Data from Parcel Perform’s community and insights platform Parcel Monitor have revealed that the US e-commerce market is primed for growth. The Covid-19 pandemic has escalated the growth of e-commerce over 2020, which saw a 71% increase in parcel volumes during the Black Friday and Cyber Monday period. This trend has continued as proven by a 43% rise in e-commerce volumes during the same period last year. The country’s cross-border e-commerce market also shows excellent potential, with 23.9% of its international shipments originating from Europe in 2021 from 19% in 2020.
“I’m delighted that Parcel Perform is doubling-down on the US market, following our extremely successful expansion in the last 24 months, defined by new hires and partnerships,” says Jerochewski.
This year, Jerochewski says the company intends to increase its global market share through continued partnerships, deployment of innovations in data science and greater effort in acquiring new customers, using its recent Series A funding.
Asked if there could be another funding round soon, Jerochewski simply says it is still too soon and that the company will make the decision as its growth plans progress.
So, what type of private investors is it looking for? Jerochewski says: “Our investors should have a strong footing in the logistics industry and have market access to potential partners and customers. We have to make sure that when we bring in an investor, they must add value to the company apart from providing money.”
Jerochewski says there are no plans for a public listing as of now given the company’s current focus is to improve its operations and find opportunities to invest as he expects competition among e-commerce players to ramp up and the next two to three years to be pivotal for customer experience in e-commerce.
With the pandemic fast receding, brands that managed to survive will be keen to remain a step ahead of their competitors in today’s e-commerce landscape where “if you don’t exist on a screen, you don’t exist”.
And Parcel Perform wants to be at the heart of creating that seamless, smooth and pain-free retail experience.
Photo: Parcel Perform
