Container Door, A Brash Kiwi Upstarts Thinks $140M Revenue Over 3 Years Will Hurt Australian Retailers
Brash New Zealand upstart Container Door, believes that they can strip revenue from Australian retailers by making consumers wait days, if not up to 8 weeks in some cases to get access to an online product.
The Company has only managed to ship 3,500 in three years since the Company was first established, now they are turning to the Australian market in an effort to bolster sales.
Container Door Founder Ben Nathan has spent the past three days spruiking his business in Australia with exclusives for the Financial Review and Channel Seven News both the retail channel media and B2b media were overlooked due to the fact that they are more likely to question the flaws in his business model.
He calls it a new eCommerce platform when the likes of Kogan and several other online retailers have been doing what Container door is attempting to do for several years.
His model is simple, he finds a factory in China markets their products in Australia on his web site and then ships it directly from the factory to the consumer via sea freight a move which Container Door claims lowers costs but takes weeks.
This is the same model that was adopted by DigitalHome 10 years ago, DigitalHome was purchased by JB HI Fi back in 2007.
After raising $NZ5 million from high net-worth investors to fund expansion, Mr Nathan is launching Containerdoor.com in Sydney this week and plans to expand to Melbourne, Brisbane and Perth, shipping container loads of stock directly into Australian ports to reduce costs rather than shipping across the Tasman.
Designed to attack retailers such as Harvey Norman who ship bulky furniture or the likes of Bunnings, Container Door reckons that they will strip $140M from “bricks and mortar” stores during the next three years.
Total retail sales in Australia was $26 billion in 2017, what Container Door PR people are spinning as a dollar value target is what one major JB Hi Fi store does in a quarter.
Nathan claims that “The Australian retail environment is ripe for a disruptor like Container Door. We offer the same products that consumers will find in-store at a fraction of the cost by cutting out the middleman. In three years of operation overseas, we’ve learnt that consumers are more than willing to wait six to eight weeks for their purchases to arrive if the savings are worth it”.
What Nathan has failed to identify is who is the middleman with sites such as Kogan or even Harvey Norman who ship furniture and bedding direct from manufacturers to an Australian warehouse where the stock is available for shipping with 48 hours.
A former fashion industry supplier to major retail chains in Australia and New Zealand, he admits that in 2012 these major retail chains started sourcing direct from factories cutting him out of their supply chain what’s not been identified is “why”.
He also plans to take on Officeworks and JB Hi Fi commercial with his “low cost” model.