Thought Leaders in E-Commerce: Gooten CMO Mark Kapczynski (Part 3)

Sramana Mitra: Talk to me about what is happening on the backend. You said you work with a lot of on-demand manufacturers. These are not your own manufacturing facilities but rather third-party manufacturers. 

Mark Kapczynski: It is based on the products that we are going to support on behalf of our merchant platforms. We source manufacturing globally. We go in and vet the manufacturer. We have to ensure quality and consistency so that we can get the same products with the same quality delivered all around the world.

We built a virtual network of our manufacturing facilities globally so that we can dynamically optimize where something should be manufactured. This is based on the availability of materials and shipping.

The example that our CEO always uses is, “If we know that UPS is having issues because of a snowstorm in Michigan, we should reroute the manufacturing center so that we can ensure the same product is manufactured at the same quality at a different location. We also need to know that it can get shipped out.”

We are always balancing this notion of where we have the capacity of manufacturing and where we have the same capacity for shipping. We optimize both of those for our merchants and ultimately their consumers.

If you, as a consumer, place an order and you are in San Francisco, we want to manufacture your item as close as possible to you so that we can reduce and control the shipping cost as efficiently as we can. If you are in San Francisco, we don’t want to manufacture the product in, let’s say, New York. 

Sramana Mitra: Given what you are doing and your view of the custom e-commerce space, can you talk about open problems in the industry?

Mark Kapczynski: I would equate it to doing it in the automotive industry. You could go to a dealership or online and pick out what kind of car you want. You pick out what kind of engines, tires, colors, and all the things you want. You push a button and the manufacturer starts to make the car.

You know exactly where it is in the production queue, when it’s going to roll off the line, and when you can get it picked up or delivered to you. There’s complete visibility and tracking across every single step of the way. In the industry that we are working in, especially in fashion and apparel, that’s not an acceptable norm. That’s not what the industry delivers on today. What we are trying to introduce with Gooten is more visibility into tracking across this full journey.

It covers the time they place the order, when an item is put up for production, when it’s going to go through quality control, when it’s going to be boxed up and packaged, and ultimately when it’s shipped and arrives at the consumer’s doorstep.

To do that today in the apparel industry is difficult. We are reliant on the major shipping carriers – the postal service and FedEx. Tracking in that world is best effort at best. That’s the biggest challenge that we have as a whole.

Imagine yourself as a consumer. You want to know where your items are at all times and when you are going to get them. We should be able to deliver on that promise. Unfortunately, when you get into shipping with the big carriers, there are so many hand-off points between all the carriers. You think you are paying for UPS, but half of their shipments go through the postal service and use the postal service infrastructure.

You end up not having full visibility into that tracking and when something will ship and arrive. We see that as a challenge and an opportunity to fix. That is a big area of focus for us. We want to have transparent visibility into tracking your order from all stages. We want to do that not just in the US but also on a global basis. 

Sramana Mitra: Thank you for your time.

This segment is part 3 in the series : Thought Leaders in E-Commerce: Gooten CMO Mark Kapczynski
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