Exclusive Q&A: Wellness retailer meets healthy order volume growth

The Nue Co. is leveraging a third-party microfulfillment provider to ensure smooth shipments during the COVID-19 crisis.

The New York-based, direct-to-consumer specialty retailer of natural supplements is partnering with New York-based supply chain startup Ohi to maintain accurate, on-time delivery as demand for its products surges in the wake of the COVID-19 pandemic. 

Ohi is a microfulfillment company enabling companies to offer sustainable, same-day and two-hour delivery throughout cities including Manhattan, Brooklyn, Los Angeles, and San Francisco. They do this via a network of small "micro-warehouses" located throughout city centers and smart technology that positions inventory closer to the end consumer. 

Chain Store Age recently spoke with Charlie Gower, COO, The Nue Co., to find out more about how COVID-19 is affecting online order volume and fulfillment. 

How much of an increase in order volume have you seen as a result of COVID-19? Why do you think this is?
In March 2020, we saw a 400% increase in our immunity-based products versus February. COVID-19 has made the world more aware than ever of the importance of health, both mental and physical. During this isolation period, we have seen a fundamental shift in the purchasing patterns of our customers, prioritizing products that can help put their body into an optimal state to deal with the risks of the virus and ensure they do not become part of the high-risk group. 

With so much information from credible and less credible sources covering the benefits of supplements and vitamins on COVID-19, we have helped our customers make decisions based on facts. We know that Vitamin D plays a critical part in supporting your immune response and that the majority of us our deficit in it, this becomes even more important when we aren't able to spend as much time outside.

What made you decide to utilize Ohi? 
At the start of February, we mapped out the potential implication of the coronavirus on our own supply chain, logistics, sales, and marketing. The complete shutdown of our existing fulfillment center was the biggest risk to the business. Our 3PL estimated an eight-to-10-hour process to sanitize the facility on contamination; however, the health department would make the final determination on whether the facility could reopen. A shutdown would bring our business to a standstill.  

As a result, we put together a contingency plan looking for a partner that could launch our e-commerce fulfillment in our two key markets, New York and Los Angeles, within a matter of days. This was a big challenge given that a traditional 3PL would need a minimum of 12 weeks to onboard a new brand, as well as a significant amount of tech support to integrate our systems.

Having been introduced to Ben and his team, it was clear that Ohi was able to meet our demanding timelines and go one better by offering same-day delivery across New York and Los Angeles, which currently accounts for 40% of our online sales. It took 14 days from our first conversation to have our first order sent out. In New York, we are offering two-hour delivery, with Los Angeles rolling out in May.

How do you link your fulfillment and order management systems to Ohi's microfulfillment network? 
This was one of the key reasons we decided to partner with Ohi. From agreeing on the terms of the contract, we were able to connect our e-commerce platform (Shopify) within a matter of clicks with no need for tech support or external integrators.

What type of results have you seen using the Ohi solution so far? 
During a time when health and wellness are more important than ever, we knew that we had to ensure that customers had no delay in accessing our products. Ohi has played a critical role in allowing us to do that. Through April we have seen a conversion rate uplift of roughly 3%, which is an uplift from the 2.5% average we had through Q1.

Have you received feedback from customers around ease of service?
Customers so far have been very positive about the experience. A number have re-posted on social media and Instagram to say how pleased they are. We absolutely plan to continue using Ohi once the pandemic is resolved.