Learn how car care company AutoGeek decided to move their DTC orders to ShipBob’s fulfilment centre to improve margins and throughput.
AutoGeek is an online car care superstore that offers all of the products that car aficionados need to keep their car clean. In addition to popular brands like Chemical Guys and Turtle Wax, AutoGeek offers its own in-house brand of car care items.
- 12 operations employees
- Up to 4,000 orders per day
- $106 average cart value
- 65,000 sq.ft. in warehouse space traded for 1 ShipBob fulfilment centre
Before the age of online shopping (or even shopping via infomercials and QVC), catalogs were the most common way to purchase the latest products. Just like Sears sold appliances via catalogs, AutoGeek was the premiere auto care retailer that offered a magazine-like mailer where people could order everything they needed to clean and detail their car.
When the internet became a tool for selling, AutoGeek was an early adopter, snapping pictures of their various cleaners and conditioners to post online. In fact, they established themselves as a one-stop shop for novice and car care aficionados by offering in-depth instructional videos on how to use the products they sold.
In the late 2010s, new car care companies emerged on the scene, but none of them compared to the expansive product line AutoGeek carried. For decades, AutoGeek has been a predominant player in the auto care industry.
But with a considerable order volume, an expansive product catalogue and growth beyond what their warehouse could accommodate, AutoGeek decided they wanted to pivot from shipping orders from their warehouses to outsourcing fulfilment.
We spoke with the AutoGeek team to learn more about their transition from in-house fulfilment to using one of ShipBob’s fulfilment centers.
Finding an outsourced fulfilment partner when in-house fulfilment was no longer scalable
As told to ShipBob by John Lewis, President and COO of Vision Investments, AutoGeek’s parent company, and Juan Sierra, Chief Technical Officer at AutoGeek.
Not too long ago, AutoGeek had a 30,000 sq. ft. warehouse in Florida and a 35,000 sq. ft. warehouse in Indiana. While we had more than 65,000 sq. ft. to work with, as a scaling company, we realised we were going to hit the walls and run out of room. There was only so much we could do.
While we’re still fulfilling B2B orders out of one of our facilities, we decided that we wanted to move our DTC orders to a fulfilment partner. The seasonality of our business is a little bit different than a typical online seller, so we knew we needed to make a change before our “peak season.”
While most of our customers are in warmer states like Florida, Texas, and California, customers in states like Pennsylvania and Wisconsin aren’t washing their cars from November to February because it’s too cold outside. That means our holiday season is the end of Q1 and the beginning of Q2, as the US begins to wake up from winter. That timeframe is really important for us.
I sent an RFP out to 5 fulfilment companies, one of which was ShipBob. I first spoke with ShipBob in October of 2022 and then visited ShipBob’s Cicero fulfilment centre. What impressed me most was their robust software, which also has all of the courier’s rates and courier selection logic. For example, if we want to sell a certain bottle of wax, we can see which courier can send it the cheapest: DHL, FedEx, USPS, and even others.
“The ability to have variable costs and competitive pricing for shipping is important to us. That’s ultimately why we chose ShipBob. Compared to fulfilling orders from our warehouses, our shipping costs have come down since partnering with ShipBob. ”John Lewis, President and COO of Vision Investments
The ability to have variable costs and competitive pricing for shipping is important to us. That’s ultimately why we chose ShipBob. Compared to fulfilling orders from our warehouses, our shipping costs have come down since partnering with ShipBob.
Plus, we know that ShipBob has over 50 fulfilment centers and plans to grow into more. Even though we aren’t ready to be in multiple fulfilment centers, we know it’s an option for when we are. As a mom-and-pop shop, if we’re going to compete with Amazon, we need to be able to get our products out to customers in 2 days.
Outsourcing fulfilment to improve margins
There were a couple of main reasons we decided to outsource fulfilment: scalability and labour. Between warehousing and labour, our costs were fixed. There was no variability in our model. We needed to find a solution that could help us be more flexible.
The fixed cost was ultimately what made us pivot from fulfilling from our warehouse to using outsourced fulfilment through ShipBob.
For example, one day we’d need to get 1,000 packages out the door, and we’d have a team of around 30 people. There would be employees receiving, picking, packing, and then people who put orders on the trucks. The next day, we’d only have 400 orders going out but we still had 30 people in the warehouse. It didn’t make sense for us to carry all of that overhead.
When we had our own warehouse, our fulfilment costs were a lot higher. We’re already seeing those numbers go down with ShipBob. That helps with our margin a lot.
Managing a catalogue of 2,400 SKUs
AutoGeek used Yahoo as our ecommerce store platform for many years. At the time, we had about 70 brands being sold on our store. That resulted in us creating too many bundles, which made our product catalogue very large. We’re currently going through all of our bundles and kits to try to set them up in BigCommerce, our new ecommerce platform, so they show up as individual items in ShipBob’s dashboard.
There are around 2,400 SKUs on the AutoGeeks website, and we tend to have a high item per order ratio.
Car care is a hobby based clientele. Our customers have a tendency to order several items at a time. For example, if you want to wash your car, you aren’t going to just buy shampoo – you also need polisher, tire cleaner, interior cleaner, rags, etc. These hobbyists also talk to each other and make recommendations and suggestions so people tend to order a lot at once.
When people come to our site, that’s when we see larger orders. Especially because we have a free shipping threshold. Our average cart value is about $106, and our average order size can be high – we recently had an order come through that had 58 items in it.
All that said, the large items really bogged down our shipping department. It was challenging for us to manage those large orders efficiently from our warehouse. We’re thankful for our partnership with ShipBob because they can take those high-volume orders on.
“Additionally, our order volume fluctuates throughout the week, and we see a spike in orders on the weekend, so using ShipBob’s model is beneficial for us. We know that orders placed over the weekend are going to be sent out on-time on Monday and we don’t have to manage which orders are being sent out by a certain time. That’s been a blessing. ”John Lewis, President and COO of Vision Investments
The mass throughput with ShipBob has been as promised. There was a day that we had 1,400 orders and it wasn’t a problem for ShipBob, they got it all out.
Additionally, I really like the ShipBob dashboard, which is good since I’m in the dashboard about 12 hours a day. I can go in and look at any outliers, and If I see an order that has a higher than normal fulfilment cost, I’ll dig into it. Usually, I’ll find that someone bought 8 gallons of cleaner or a detailing cart that has a large dimensional weight.
What’s next for AutoGeek?
We’re focused on optimising our operations and setting ourselves up for success for this new chapter in our business. I think we’re going to grow really quickly and we’re looking forward to utilising ShipBob as a partner in our growth. ShipBob and AutoGeek are one – we’re figuring out how to navigate it together.
The best part of partnering with ShipBob for fulfilment is that we don’t have to manage as many people. So now that we’ve outsourced our fulfilment, have been able to shift our focus on other aspects of the business.
AutoGeek’s team at ShipBob
Cole is the Enterprise Account Executive that brought AutoGeek into ShipBob.
Christina is the Senior Merchant Success Manager at ShipBob who supports the AutoGeek team.
Divey is ShipBob’s Co-Founder and Chief Operating Officer. He is AutoGeek’s Executive Sponsor.
Get started with ShipBob
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