Brazil’s e-commerce market continues to thrive, but logistics-wise, buying online can be a bit of a headache. Company builder Project A Ventures is tackling the problem head on with its latest project, Intelipost.
The software gateway for e-commerce logistics launched this month. It integrates diverse transport options onto one single platform, facilitating the management of the entire shipping process and including real-time quotes, delivery monitoring and business intelligence services. It seeks to benefit retailers, shippers and consumers alike.
At the helm of Intelipost is Stefan Rehm. Originally from Germany, Rehm has led Project A Ventures’ São Paulo business development efforts since 2012. He spoke with us about this latest project and the challenges dogging e-commerce in Brazil.
Emily Stewart: A number of consumers in Latin America avoid exchanging or returning products because, logistically, doing so is so complicated. How are you addressing this problem?
Stefan Rehm: You are right. The return/exchange process is more complicated than in the U.S./E.U., where Amazon, for instance, already prints the return label and puts it in the box when delivering the product. The consumer then just needs to put return label on the outside of a box and drop it off at a local postal office.
In Brazil, we are not there (yet), as returns are not as frequent as in other countries. Retailers do not incentivize it because returns are expensive. The logistics providers do not like returns because they is logistically complex and thus expensive for them, and end consumers do not exercise their rights as much because they need to proactively request a return ticket from the shop.
The latter also seem to avoid returns due to unclear and nontransparent processes at the respective e-retailer. We aim to solve this problem through technology. We’ll be the logistics platform for tracking, exchanging information, and requesting returns between all players, from the end consumer via the transport company to the e-retailer.
We know this pain, and that is why we put this feature on our roadmap to be ready soon.
ES: What are the biggest challenges still involved in e-commerce logistics in Brazil? What problems have generally been solved?
SR: Brazil is a continental sized country. Logistical challenges are not only related to the vast size of territory that companies need to cover. Other issues include:
- Professionalism in the transportation segment. There are many very small providers that neither pay the full amount of taxes nor use any kind of technology.
- Complexity in everything – pricing process, contract setup, communication, customer service, etc.
- Technology in general. Except for a few very large players, it is very difficult to find logistics provider with a ready-to-use API to access tracking data, and many processes rely on manual steps.
- The price focus of e-commerce shops. Often, the only criterion for choosing a delivery provider is based on price, ignoring quality of service.
All fronts have seen improvements in the past years , thanks to the professionalization of e-commerce in general. But we are still far from the standards of the U.S. and Europe. This is why we think that Intelipost can make a big difference in e-commerce logistics in Brazil.
As we connect the e-commerce to the transport company by means of an API, we tackle one of the above challenges specifically. We will introduce a quality score per shipment so that the market can shift the focus away from a cheap delivery price to quality of service.
ES: What scale of businesses is your solution best fit for?
SR: Today, our solution will bring most benefits to the medium-sized e-commerce companies beyond the top 20 e-commerce giants, as we are gaining traction and improving our feature set. We will target the giant e-commerce operations in a bit, but with a slightly different value proposition.
ES: Do you plan to take this outside of Brazil?
SR: Yes, absolutely! The need for such a solution is not restricted to Brazil. As a result, international expansion is a set cornerstone in the roadmap of the Intelipost.