Shopping online has never been simpler, but behind every e-commerce purchase, there’s a complex logistics network working to get that parcel from a distribution center to the customer’s front door — and Uber wants to cash in on it.
Ahead of its initial public offering — for which it is seeking a valuation between $80 billion to $91 billion — the ride-hailing company has been building its Uber Freight arm with the aim of creating “a transparent, on-demand marketplace that seamlessly connects shippers and carriers,” according to its SEC filings.
The documents also reveal that, since its launch in May 2017, the Freight business has grown to include more than 36,000 carriers and has served over 1,000 shippers, including retailers. In the final quarter of 2018, it generated more than $125 million in revenue, and Uber considers it one of its “high-growth emerging offerings,” along with food delivery platform Uber Eats.
On Monday, the company announced a partnership with software giant SAP to integrate Uber Freight into the SAP Logistics Business Network, putting the technology in front of an even greater number of businesses.
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“For the world’s biggest shippers, an efficient, digitalized supply chain is critical to their success,” said Uber Freight’s senior director Bill Driegert. “Uber Freight is partnering with SAP to bring shippers and carriers together at the level where freight decisions are being made. This innovative tech-forward approach to freight means shippers can spend less time sourcing quotes and capacity and more time getting goods to market.”
Logistics is a rapidly growing industry in part because of the rise of e-commerce. Online sales currently account for about 10% of total retail sales in the U.S., according to the Department of Commerce, but that number is expected to reach 17% by 2022, according to Forrester Research Inc.
Uber is also taking notes from the biggest force in online shopping. “Cars are to us what books were to Amazon,” Uber CEO Dara Khosrowshahi said at a Fortune conference in July. “Just like Amazon was able to build this extraordinary infrastructure on the back of books and go into additional categories, you are going to see the same from Uber.”
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