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No it’s not. It’s a partnership. It’s our software; it’ll be our robots, but they own it, it’s their business. We do have one that we own ourselves. It’s almost like a laboratory, it’s here in Ottawa, so we can do some testing. But those fulfillment centers, those nodes are all third-party owned.
So what does that deal look like? I happen to own a warehouse. I’m like, “Man, I’m getting crushed. I gotta call Shopify.” Do I just one-click order a robot and you take it over? How does that work?
You own a warehouse. You have all this capacity. You call Shopify, or we call you because you’re in a particular region that we really like. And we say, “Hey, we think you’re a perfect candidate to be in the fulfillment network.” We go in there, we make sure the quality control is a certain level. We make sure that you have all the capacity. And then we start sending you products and you get paid a fee for every product that you store, that you pick, you package, you fulfill. You no longer have to do any of the marketing if you’re one of these 3PLs.
Who bears the cost for the robots that end up in the factory? Is that you or is that the warehouse center?
Those are all different, depends on the warehouse. In some cases they want them anyway, because they have other customers. And so they’re paying for it. In other cases, we decide that it’s such a strategic warehouse that we want to put those in there. And in other cases, it’s one merchant that has the whole warehouse and so we’ll have to deal with the merchant itself.
One of the things that’s really interesting about this is, obviously, Amazon is a big competitor here. They own and operate a lot of their own warehouses. They have a lot of different kinds of deals. They have a lot of contractors as delivery drivers with Amazon logos on the vans. It’s almost impossible to figure out.
But one constant is the people who work in these warehouses, who drive the trucks, are not always in love with working for Amazon. There’s a lot of labor unrest at Amazon to enable the amount of volume they do, to enable their shipping speed. There was just a failed union drive in Alabama, there’s going to be more. Internationally there’s more labor unrest against Amazon, we hear the stories every day.
You’re trying to enable the same thing at scale, maybe using a different model. Have you thought about the people who actually put the stuff in boxes, drive the trucks, enable the two-day shipping?