Matching spare space to storage demand

Its founder, Chris Hopkinson, is pleased Zupplychain has got out of the blocks so quickly and has been talking about how the idea came to him.

Chris’ background has included founding and running a kitchen and bathroom distribution business and as a non-executive director and major shareholder in the appliances e-tailer, AO.com, which floated in early 2014 with a market valuation of over £1.2bn. This distribution and e-tailing experience inspired Chris to consider how the web could enable a ‘market disrupter’ to solve the warehousing and storage issues faced by a business with excess stock levels.

Chris’ distribution business had 300,000 square foot of storage space, up to £10m of stock and 1000 regular trade customers. ‘Kitchen and bathroom products are notoriously difficult’, says Chris. ‘Physically they can be quite ‘ugly’ to store – particularly bathrooms. Both industries innovate at pace, proliferating SKUs whilst older products often staying in the range for product guarantee reasons. Demand is seasonal and, in some channels, promotionally driven and unpredictable; major range changes can often lead to dual running stocks. To top it all, in-bound lead-times from component manufacturers (usually in Europe, China or Turkey) are long – 4 to 12 weeks – but lead-times out to trade customers – kitchen shops – are a matter of days’.

‘The problem of too much stock was usually solved by ringing a familiar local option for over-flow storage,’ Chris continues, ‘with a sense that prices might not be the best or that moving the stock problem ‘round the corner’ rather than to a strategically better location was a poor man’s answer’. 

So the concept of Zupplychain grew out of the sense that the warehouse community of 3PLs and those operated by manufacturers and distributors needed a market-maker to better match the ‘over-spaced’ with the ‘under-spaced’. Chris felt the Zupplychain concept could help warehouses fill their space more quickly and easily than traditional business development methods, particularly with customers who generally addressed short term warehouse space problems with makeshift, local solutions; and long terms ones by building or long leasing another warehouse.

‘We drew inspiration from other ‘peer-to-peer’ websites such as Airbnb, E-bay, Zoopa and even dating websites! We aim to show users the best solutions for their ‘search’, with clear pricing and to offer an easy and quick enquiry and transaction platform. In time we will have ratings and reviews as part of a fully interactive warehouse operator and customer community’, explains Chris.

However, the vision for Zupplychain goes beyond matching warehouses to customer requirements. Right from the beginning, the idea of creating a ‘warehouse management system in the cloud’ has been integral to Zupplychain’s goal of enabling businesses to fully outsource their warehousing and logistics functions and concentrate on what they do best, be that manufacturing, sourcing, product development or sales. 

In the last few years, Chris has sold his distribution business and floated part of his stake in AO.com, giving him the time and funds to turn the Zupplychain idea into reality. He concludes, ‘We have plenty of plans for Zupplychain, both in terms of product width and market depth, and have built a platform with the scale to achieve that, both in the UK and beyond. But first, I’m looking forward to us launching the search facility in May and bringing together warehouses and customers’.