When Matt Chasen’s mother called him in tears because she couldn’t afford to pay US$800 to ship an heirloom dresser across the country, he set out to solve the problem. His solution was the genesis of an innovative online company called uShip.
The light bulb moment came when Chasen was driving from Seattle to Texas to enter the McCombs MBA program at the University of Texas. The Boeing engineer took note that his rental truck was two-thirds empty and began brainstorming about how he could lower shipping costs by matching excess truck capacity with people’s oversized deliveries.
“I didn’t need to reinvent the wheel,” Chasen, founder, president and chief executive of uShip, in Austin, Texas, told the E-Commerce Times. “Our business model is similar to eBay’s. UShip is a peer-to-peer marketplace that connects drivers with shippers.”
Emerging Concept
This emerging concept is sort of like a reverse auction for shippers anddrivers. Shippers list details of their freight, and feedback-rated movers, freight carriers and independent drivers make bids to deliver those shipments. The bids are often at prices far below retail rates because the drivers are filling unused space in their trucks.
The concept is catching on. UShip has attracted more than 3,000 drivers and brokered more than $1 million in shipments since launching the company in March 2004. Other services, like U-Haul’s eMove and a Canadian start-up called Hitchpack are also in the online shipping and hauling business.
UShip’s portion of the pie totals just a small fraction of the 43 milliontons of cargo shipped in the U.S. daily, according to Applied Data Resource Management (ADRM). ADRM reports trucks are responsible for 64 percent of all shipments. Analysts said there is a vast opportunity to revolutionize shipping logistics, and online auctions like uShip are driving toward it.
Tapping eBay
With what he perceives as a remedy to eBay shippers’ pain, Chasen hasfocused much of his marketing efforts on customers of the leading online auctioneer.
To be sure, eBay sellers are often limited to regional listings of bulkyitems because, like Chasen’s mother, buyers aren’t willing to pay megabucks to ship large, albeit sometimes low value, items.
“This is a solution that the eBay community needs badly,” says Janelle Elms, lead instructor for eBay University and author of eBay Your Business, told the E-Commerce Times. “Now sellers have the opportunity to sell beyond their 50-mile radius. It opens up their customer base.”
“UShip is on the radar screen at eBay,” Elms said. “The company’s acceptance rate is very high because they are doing the things that the eBay community is asking them to do. UShip has proved itself to the eBay community.”
Trust Factor
At this point, the biggest challenge for sites like uShip, Hitchpack andeMove is not competition. No, the biggest challenge is one that eBay alsohad to break through: the trust factor.
“If the seller has to wait around for the buyer to figure out how they will arrange for delivery, the seller is not going to be happy,” InaSteiner, editor of AuctionBytes, a news and information service for online auction users, told the E-Commerce Times.
“The two parties have to trust each other — usually complete strangers — and you want to get the transaction completed as quickly as possible.”
UShip is taking a page from payment processor PayPal’s playbook to help overcome that hurdle. It allows eBay sellers to copy and paste a click through logo onto their auction pages that says, “I offer uShip.” The strategy is paying dividends. UShip typically has about 800 listings on any given day.
Furnishing Feedback
However, that’s not Steiner’s only concern. “If it’s someone I don’t know, how do I really know they will deliver the item to me?” she asks. “That’s why the professional listings are critical to shipping-service marketplaces.”
Online shipping auctioneers have taken these trust issues into consideration and have implemented driver feedback rating ala eBay. Over time, the companies believe this will build credibility.
“The first person that bought Superbowl tickets for $1,000 on eBay wasprobably a little nervous,” Chasen said. “We have to build the feedback of our shippers and drivers to the point where people are comfortable trusting the brand and our members to fulfill the transaction.”
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Much of what has been said in the previous post is true! – Many of the "vendors" on uship are not operating correctly. We have been bidding on projects there for a year, and are constantly being underbid by operators who have only a pickup and trailer, no markings or anything. Buyer beware – those of us with real trucks, insurance, and experience are going to cost more then your next door neighbor with a pickup truck – BUT the chances of success are WAY higher, and your stuff does not run the risk of being tied up in court as evidence when the DOT catches these idiots!
Also consumers should know that UShip double dips on fees, this is how it works: You submit an item to be ship, you take bids for a period of a few days. You deside that you are going to accept the cheapest bid for an example: the bid was $500.00. So $500.00 is what it’s going to cost to ship your item across the states. You are asked to make a deposit to the Transport Carrier of $72-$75.00 plus your fee to ship the item. In reality the Transporter never sees the deposit it’s UShip Fees and it goes directly to UShip and you as the Shipper pay it.
Second most Transporters on UShip are illegal using false documentation or someone elses. UShip doesn’t weed these people out because they would loose money.
Most Transporters if you look at they’re profile photos never have a business name or numbers on their vehicles they use for hauling. Why? because they are running illegally even if they have a high feedback some people just don’t care and take the chance.
Think about it some of the bids that are placed on most of the items shipped are rediculously cheap. I’ve seen some as cheap as .23 a mile after fees. How can you opperate with that? I’ve seen it were Transporters ask the shipper that he will do it for a tank of gas? It’s like the old saying "If it’s to good to be true" well you the rest.
People should Google the Transporter and see if they have a website. That would be the best and all around cheaper and safer.
Also UShip is in a law suite also by some major transport companies around the United States.
So Shipper beware!
Double dipping is an understatement. UShip charges 16-17% of every load for the carrier and 16-17% for the shipper. Then they charge the carrier $1.00 fee for every $20.00 when we transfer our money from them to our bank. Or they charge $10. for every check they send you. I’ve only been doing business with them for a short while and have lost so much money. So I say shipper beware? No CARRIER beware!!!