Newgistics expands its range of fulfillment and e-commerce services

August 22, 2013 10:16 AM

Newgistics Inc., a provider of online order fulfillment and returns services, announced several developments this week in its efforts to become a one-stop shop for e-commerce technology and services.

The company has bought software developer and consultancy Tacit Knowledge and entered into technology-selling agreements with e-commerce platform provider hybris AG and Manhattan Associates Inc., a provider of order management technology. Those moves will position Newgistics to help e-retailers operate across online and offline retail channels, says CEO Bill Razzouk.

“In the rapidly evolving and increasingly omnichannel world of retail, our end-to-end e-commerce solutions will help our customers stay ahead,” Razzouk says. Omnichannel retailing describes the ability of consumers to shop across multiple retail channels, including e-commerce, stores and mobile commerce.

Industry analysts describe the collection of deals as a positive move for Newgistics, allowing it to act as a single point of contact for e-commerce technology and services from four leading providers: Tacit Knowledge, hybris and Manhattan as well as Newgistics itself . In effect, Newgistics can now offer a range of technology and services covering consumer-facing e-commerce and back-end order management, order fulfillment and delivery. Newgistics also provides its own network of fulfillment centers throughout the United States, through which it forwards orders for retailers through multiple carriers to the U.S. Postal Service for local deliveries. “End-to-end solutions are always easier from the retailer’s point of view,” says Paula Rosenblum, a managing partner of research and advisory firm Retail Systems Research LLC.

One of the most important services Newgistics can now offer, and one that will differentiate it from some competitors, she adds, is the order management technology from Manhattan Associates. Because Manhattan’s order management system can route online orders to multiple sources of inventory, including multiple warehouses and retail store locations, it’s designed to help retailers manage orders and inventory stocks more efficiently. If a warehouse dedicated for fulfilling online orders is out of stock of a particular item, for example, the Manhattan order management system can automatically route the order to a different warehouse or even a  store that has the ordered item in stock.

Rosenblum says the new range of technology and services will help Newgistics compete against eBay Inc.’s eBay Enterprise, formerly known as GSI Commerce. EBay Enterprise offers an order management system that is designed to route orders to the most appropriate fulfillment facility among multiple warehouses and stores, based on criteria such as inventory levels and the proximity of each location to the end-customer, a spokeswoman says. Among eBay Enterprise’s business units are VendorNet, a company that also offers order management technology that can route online orders to multiple warehouses as well as stores and drop-shippers.

Peter Sheldon, an e-commerce technology analyst with Forrester Research Inc., says the expanded range of e-commerce technology and services at Newgistics will also help the compete against other providers of combined e-commerce and fulfillment technology and services from PFSWeb and Netrada, which also have connections with vendors of order management systems. “This will give Newgistics a better shot against their larger competitors,” Sheldon says.

Newgistics declined to reveal pricing for retailers that want to deploy all or parts of its offerings, noting only that the price “depends entirely upon the requirements and level of customization” that a retailer needs.

Newgistics, a privately held company, did not say what it paid for Tacit Knowledge, which designs and builds e-commerce sites on its own technology or on other vendors’ e-commerce platforms, including hybris Software,  Demandware and Oracle Corp.’s ATG Web Commerce. It also builds custom software applications, including product recommendation engines, site monitoring tools and shopping applications for mobile and social commerce, that can run on its own or other vendors’ e-commerce technology.

Newgistics has three clients among the top 1000 e-retailers ranked by Internet Retailer, including Title Nine and Frederick’s of Hollywood, Nos. 337 and 339 in Internet Retailer’s 2013 Top 500 Guide, and, No. 892 in the 2013 edition of the Second 500 Guide. Manhattan Associates has 12 clients listed in the Top 500 Guide and two in the Second 500 Guide; hybris has three clients listed in the Top 500 Guide.




Top Solution Providers