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BusinessCanadaCompany earningsFinanceNewsToday's Pickup

Today’s Pickup: Shopify taking slow road in gunning for Amazon on fulfillment

Canadian e-commerce company sticks to measured approach to building out its U.S. fulfillment network after reporting nearly 50% jump in sales.

Good day,

Shopify (NYSE:SHOP) offered a glimpse of its plans to carefully build out its fulfillment network — and wade deeper into Amazon’s (NASDAQ:AMZN) territory — as the Canadian e-commerce company reported a 47% increase in revenue during the fourth quarter.

The company said it intends to continue its “measured approach” to growing the Shopify Fulfillment Network by focusing on merchant experience and “adding scale only at the rate at which service levels can be maintained.”

Shopify recorded $505.2 million in revenue during the fourth quarter, a 47% improvement over the same period in 2018. The company, which reports in U.S. dollars, had an adjusted net income of $34.3 million, or $0.30 per share, versus $44.1 million a year earlier.

Shopify's stock performance as seen on FreightWaves SONAR platform.
Shopify’s stock performance as seen on FreightWaves’ SONAR platform.

The company also deployed automated warehouse technology at a fulfillment provider from its recently acquired 6 River Systems

Shopify announced the launch of its U.S.-based fulfillment network in June. It leverages third-party warehouses where Shopify merchants maintain inventories and ship to customers.

Did you know?

Ice road truckers can earn $30,000 to $40,000 in just three months of dangerous work, making them some of the highest-paid drivers out there

Quotable:

“You don’t know what you don’t know until you know it, and then you have to do something about it.”
— Sherri Brumbaugh, president and CEO of Garner Trucking, discussing carrier profitability during the Katz, Sapper & Miller 2020 Trucking Owners and Leaders Roundtable 

In other news:

California lawmaker wants to raise speed limit for trucks

A California State Assembly member proposed a bill that would increase speed limits for commercial trucks and buses to align with passenger cars. (KSBY News

Florida trucker charged with assault, DUI after pitbull attack

A Florida truck driver faces assault and drunken driving charges after police say he set his pit bull loose on police officers, who fatally shot the dog. (Daily Voice)

Coronavirus hits Vietnam-China freight

The coronavirus outbreak is hurting Vietnam’s cross-border trucking companies and freight forwarders that rely on business with China. (The Load Star)

Seafood hauler says imposter spoiled his driving record 

A truck driver for a Canadian seafood company says he can’t drive to a neighboring province because of unpaid traffic fines incurred by someone using his name. (CBC News)

Final thoughts:

Shopify’s slow ramp-up of its fulfillment business seems to reflect the approach of founder and CEO Tobi Lutke. He revealed on Twitter in December that he seldom works more than 40 hours per week. 

“The only times I worked more than 40 hours in a week was when I had the burning desire to do so. I need 8ish hours of sleep a night. Same with everybody else, whether we admit it or not,” he tweeted. 

Hammer down, everyone!

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Nate Tabak, Border & North America Correspondent

Nate Tabak is a Toronto-based journalist who covers Canada for FreightWaves. He spent seven years as an investigative reporter, producer and editor based in Kosovo. He previously worked at newspapers in the San Francisco Bay Area, including the San Jose Mercury News. He graduated from UC Berkeley. Contact Nate at ntabak@freightwaves.com.

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