Effortless Scalability Through Logistics Solutions

Q: How did the e-commerce boom across Latin America help Melonn grow in recent years?

A: The digital transformation triggered by the COVID-19 pandemic outlined new avenues of opportunity that Melonn could pursue in Latin America. Stringent and prolonged stay-at-home restrictions made logistic solutions a necessity as more people participated in digital retail spaces, such as Instagram, Facebook, WhatsApp and Marketplaces. While retailers initially welcomed the traffic and growth, they quickly became overwhelmed by the numerous logistical challenges involved with scaling as rapidly as they had to. Based on these observations, the conception of Melonn was directed at SMEs that lacked practical logistics know-how. By entrusting us with this considerable challenge, our clients could focus on their core business and grow in parallel to the e-commerce boom. 

Q: What added-value can e-commerce companies expect to receive from Melonn that would persuade them to defer to a third party?

A: Of Melonn’s overall commercial offer, its most attractive added-value element would have to be its technology component, which connects, integrates and centralizes all of our client’s sales channels onto a single platform. This omnichannel solution provides our clients with complete visibility over product inventory and sales performance data across the retail market and even traceability of shipped products, without having to bargain for this service with transport partners. 

The omnichannel solution has brought relief to SMEs, which have been able to focus on their core business and product development instead of researching, negotiating and mastering logistical hurdles across unfamiliar geographic boundaries. This can be a daunting task for entrepreneurs. 

Considering the collective market potential of SMEs in Latin America, Melonn found it important to act as a vehicle for growth. Advanced logistical capabilities are fundamental to this ambition. Without them, SMEs risk stagnation in such a highly competitive market. Melonn’s same-day and next-day deliveries give our clients a higher competitive advantage that can help them reduce cart abandonment, increase purchase frequency and accelerate their market capture. 

Q: How large is Melonn’s warehouse and distribution network in Latin America? 

A: Melonn launched in Colombia at the end of 2020 and today we have warehouses in Cali, Medellin and Bogota, three of the country’s most important urban centers. In 2021, we expanded to Mexico where we rapidly grew our network from Mexico City to Guadalajara and Monterrey, allowing us to introduce an incomparable value proposition regarding delivery times for our clients.

Melonn aims to continue expanding throughout Colombia and Mexico. Cities mapped out include Barranquilla and Eje Cafetero, Colombia. Contingent on further analysis are Queretaro and Puebla, which we considered after realizing the volume of orders heading toward southern Mexico. We also aspire to continue growing our regional network in Latin America and although nothing has been clearly defined, we expect to have something cemented toward the end of the year.

Q: Why does Melonn choose urban centers for storage, over adjacent centers with lower storage costs?

A: From our initial experience in Colombia, we learned that while the cost of cubic meters is higher in urban centers, cities enable us to meet our commercial promise and offer better infrastructure for fluid and secure mobility. Furthermore, our sellers can visit our warehouses to examine storage conditions and check their inventory while feeling secure and confident of the entire logistics operations we have at Melonn.

Q: Does Melonn manage its own shipments or does it subcontract carriers? 

A: We have developed strategic alliances with different transportation companies, allowing us to negotiate for larger volumes, offering competitive pricing entrepreneurs. In return, we are able to pass on much fairer rates to our clients’ end consumers, as well as higher standards of quality and service. This is further optimized by our Orbit platform, which suggests the best regional partner to transport a package from our warehouse to its end-point. Optimizing this process is fundamental to meeting our commercial offer. 

Q: What objectives does the company have for 2022 and how will it measure its success?

A: The retail market is at an inflection point in which it will have to decide if it will continue betting on physical points of sale or if it will progressively starve these fixed costs and move to a completely virtual model. If the latter turns out to be the case, it will be a significant opportunity for Melonn in Mexico. Our objective will be to deliver over 1 million items by the end of 2022 and increase our volume and frequency of sales.