Re-assessing drop shipping—again

Back in the early days of online retailing, the term “virtual merchant” meant just that—such retailers were all but merchants. Many stocked no inventory and had no customer service reps.

That was the market that Commerce Hub Inc. targeted. Founded in 1997 by Frank Poore, an ex-computer salesman and logistics expert who was familiar with the vagaries of retailers’ order management systems, Commerce Hub identified as its market retailers who wanted to sell online but didn’t want to stock inventory. Instead, they would fulfill orders via drop shipping—the retailer is the conduit for the order and the manufacturer fulfills it.

Drop shipping was nothing new, but Poore had a notion that the web would change the way retailers and manufacturers communicated to make drop shipping work. “Every retailer has a different file format, wants different selections of products and has different business rules,” he says.

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