EBAY eBay Inc

By Jennifer Smith 

Online marketplace eBay Inc. is rolling out a fulfillment service aimed at helping its high-volume sellers ship orders to customers faster and more cheaply.

The service, a new step in the growing competition over shipping of online orders, will rely on a network of third-party logistics providers using an eBay technology platform to store, pack and ship inventory from "strategically located warehouses across the country," the company said Wednesday.

Launching next year, the offering comes as more e-commerce companies are extending into physical distribution operations as retailers and online brands competing with Amazon.com Inc.'s fulfillment network look to slash distribution costs and position their products closer to customers.

Last month Shopify Inc., which provides internet shopping platforms and other services that help companies sell items online, announced a similar service that uses machine learning and other technology to allocate inventory and route orders.

EBay's offering, known as Managed Delivery, will allow sellers in categories with fast-moving inventory such as electronics and fashion to offer their customers free shipping and faster delivery, eBay said, potentially boosting their sales. Sellers who qualify for the service will be able to tap into eBay-negotiated rates for overnight, two- and three-day shipping and use eBay-branded packaging.

Buyers will also be able to track delivery of those packages.

Such options are proliferating as startups such as e-commerce fulfillment company ShipBob and Flexe Inc., an on-demand warehousing marketplace, launch services pitched at retailers that vie with Amazon for consumer sales. Those companies are competing with providers such as Belgian Post Group-owned Radial, which was formed from the 2016 merger of eBay's former enterprise fulfillment unit and Innotrac Corp., and provides technology and e-commerce services for retailers such as Dick's Sporting Goods Inc.

Traditional logistics operators are also getting in on the game. FedEx Corp., United Parcel Service Inc. and XPO Logistics Inc. have all launched fulfillment and warehousing services aimed at small and medium-size companies.

EBay's move comes as the company is struggling to contend with larger rival Amazon. While the company's second-quarter revenue rose 2% to $2.7 billion, the total value of goods sold on its site has been falling, and dropped another 4% in the quarter to $22.6 billion.

Write to Jennifer Smith at jennifer.smith@wsj.com

(END) Dow Jones Newswires

July 24, 2019 14:29 ET (18:29 GMT)

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