E-commerce innovator Kunal Thakkar: Operating expertise
July 5, 2016 11:41 AM
When Kunal Thakkar, senior vice president of operations at online electronics retailer Newegg Inc., finished his master’s degree in engineering management, the plan wasn’t for him to stay in the United States, but rather to return to his native India.
“My family has three businesses over there,” he explains.
Then he landed a job working for UPS Supply Chain Solutions and, well, those plans changed.
“UPS Supply Chain came up with an opportunity for me to work with them, and I decided I must get some experience here before I head back,” he says.
Fifteen years on, he’s still gaining experience. He has carved out a successful career in operations management, spending four-and-a-half years at UPS before joining lingerie and costume manufacturer Leg Avenue as vice president of global operations and business strategy in March 2006 and then moving to Newegg in 2012.
“I started with Newegg as a vice president of global operations and within nine months I was promoted to senior vice president of global operations reporting into the CEO,” he says. “Today with Newegg, I’ve got the entire global operation with me, everything from fulfillment to transportation to logistics infrastructure.” Global expansion has become more of a priority for Newegg. In August 2014, the retailer announced it was expanding into India, Ireland and Singapore among other countries. Newegg is also ranked No. 24 among online retailers in China, according to the Internet Retailer 2016 China 500.
While Leg Avenue was his first foray into the world of retail, he says it was his first job at UPS that has proven critical to his success at Newegg, which sold an Internet Retailer-estimated $2.943 billion online last year, making it No. 17 among online retailers in North America, according to the Internet Retailer 2016 Top 500 Guide.
“Having that experience at UPS helped me to build the foundation for Newegg’s network and figure out how do we get to the customer fast and in the most economical way to exceed expectations,” he says. “More than anything, UPS helped me gain the fundamentals of the supply chain that I could bring to Newegg to help strengthen its infrastructure.”
One of the ways that Newegg has strengthened its infrastructure under Thakkar’s watch is to cut the amount of time it takes for shoppers to receive their orders by building additional fulfillment centers and improving existing ones.
He and the company have taken a number of steps to accomplish this, including placing an emphasis on same-day order fulfillment from all six of its warehouses in North America.
“We created an omnichannel experience by putting in a few initiatives, including creating a same-day fleet service so we have our own trucks that provide same-day delivery within a 50-mile radius of our warehouses,” he says. “Today we are offering that in Southern California. We are also offering that in New York/New Jersey in partnership with [the U.S. Postal Service’s] MetroPost.” The e-retailer plans to extend the service to Indianapolis and Memphis.
Thakkar says Newegg isn’t necessarily feeling the heat from Amazon.com Inc., which has steadily reduced its delivery times and now fulfills orders in as little as one hour. But he acknowledges customer expectations have evolved as a direct result of those initiatives.
“Customers are getting used to the two-day and the one-day (delivery),” he says. “We are working diligently to make sure our logistics strategy can give the customers what they’re looking for.” For example, the e-retailer is looking to devise ways to give shoppers greater control over where and when they receive their packages.
The challenge is being able to meet, and exceed, those fast delivery expectations while making sure Newegg makes money. It’s a challenge Thakkar says he and his team meet by working closely with the delivery services Newegg uses, including FedEx, DHL, and the U.S. Postal Service.
“We make sure that we offer various options on the website,” he says. ”We will tell consumers we have a same-day, two-day or three-day model open, and here’s the cost you may have to incur. This is the way we try to grow the top line and maintain a profit at the bottom line.”
Internet Retailer staffers profiled six e-commerce innovators for the July edition of Internet Retailer magazine. For more information on how you can get your free monthly subscription to Internet Retailer magazine, click here.