Beyond EDI: Modernizing Dropship and Marketplaces for Growth

Transcript

00:00.72
Natalija Pavic
Hello, welcome to the show. Thank you so much for joining us. Why don’t you tell me a little bit about, you know, who you are, what you do. And I know we have two people on here. so I’m just going to introduce my my co-host, Ty Sweet as well.

00:12.62
Natalija Pavic
But the the real guest, Sachin, is you. So why don’t you take it away?

00:16.89
Sachin Sharma
Yeah, absolutely. Thanks, Nat. Hey, Ty. um hi everyone. My name is Satran Sharma. I’m the chief product officer here at Kibo. I’ve been with the business for about just about seven years now um to the month. So I think I just had my seven-year anniversary a couple of days ago.

00:32.32
Sachin Sharma
um It’s been a great ride over that period of time. But yeah, that’s currently Kibo.

00:39.40
Natalija Pavic
Amazing. And we’re so excited to have you here. And, you know, we get to we’re so blessed to have your time and get to ask you a ton of questions, even when we’re not recording. Ty and I are always peppering you.

00:48.84
Sachin Sharma
Thank you.

00:48.91
Natalija Pavic
So um but I think what’s fascinating about your career journey, you know, given that your chief product officer is I’ve always I’m always intrigued with executives that take some interesting eye opening courses in university. i was sleuthing your LinkedIn and I saw that you took philosophy.

01:02.96
Natalija Pavic
So I’d love to know from you what was your favorite philosophy class ah from college?

01:07.94
Sachin Sharma
That’s right. Yeah, no, i mean, great question that. ah Yeah. So in school, I majored in philosophy and in economics. On the philosophy side, a lot of um what I studied, you know, was a little bit more abstract. So the way I thought about it was like, you know,

01:22.97
Sachin Sharma
um you know, some people think about colleges getting very vertical skills, you know, take a class on this, learn how to use that tool, learn how to solve this discrete problem. I thought about it, I guess, a little bit more horizontally and wanted to like work on my analytical skills and thinking skills and quantitative skills. That’s kind of what led me to philosophy and economics. And so in terms of philosophy, I took a lot of coursework in the space of like,

01:47.76
Sachin Sharma
philosophy of art, philosophy of language, um and some associated things, a lot of aesthetics classes. So probably if I were to pick a couple of them, I mean, I think um in the aesthetic space and kind of philosophy of language space, I took a a bunch of classes there.

02:04.17
Natalija Pavic
yeah

02:05.95
Sachin Sharma
The ones that I took there were probably the most impactful that, you know, I always remember about. So things like, you know, Define definition of terms, right? Like what is art, right?

02:16.32
Sachin Sharma
That was like a big central question that was asked in one class on like philosophy of art.

02:17.59
Ty Sweet
Oh, wow.

02:19.15
Natalija Pavic
Wow.

02:19.77
Ty Sweet
Yeah, that’s that’s major.

02:21.58
Sachin Sharma
Yeah, which is, you know, was really, really interesting.

02:21.86
Natalija Pavic
I

02:23.98
Sachin Sharma
And to some people, it’s like, ah hey you know, that’s a stupid question. Obviously, look at a painting, it’s art, right? But on the whole question the whole premise of the question, right, is like, maybe it’s not a well-defined thing.

02:30.92
Natalija Pavic
don’t think so.

02:35.10
Sachin Sharma
And this goes back to a lot of other philosophical writing from, you know, a bunch of different periods in time, and, you know, gets investigated in like postmodern philosophy as well, in terms of questions like, what is a game? And, you know, it’s kind of a a very popular question that was asked by a bunch of philosophers and stuff like that.

02:52.66
Sachin Sharma
The second one that I would probably um ah bring up and mention that was like really, I thought helpful for completely different reasons was a logic class that I took. So I took an elementary logic class. I took an intermediate logic class.

03:07.52
Sachin Sharma
The intermediate one was like ah was like a math crossover class as well. So it was not, you know, had nothing to do with reading and writing. It was very much more almost like pure math, ah kind of like proof based, but all from a purely logical perspective. So like defining a set of elements that make up some kind of a system and what is valid within that system, what is not valid within that system, and ends up looking a lot like, you know, a number theory proof or something like that right at the end of it.

03:36.56
Sachin Sharma
So that was like super helpful for other, you know, reasons. Again, very, very analytical in terms of how the class was delivered and sort of the toolkit that you’re building and things like that. And so all those things were super valuable. I think actually most of what I’ve done in my career, i feel like philosophy has almost helped me more then ah than economics. It’s been interesting just in terms of completeness of thought, how you approach problems, those sorts of things, those sorts of spaces, you know, um it was really, really helpful in developing those skills.

04:08.00
Natalija Pavic
So does that mean you had to read Wittgenstein?

04:11.69
Sachin Sharma
I did. Yes, that that is. Yes, absolutely. and you know, yeah, Vittgenstein is one of the people who’s like, you know, what is a game, right?

04:16.49
Natalija Pavic
ah Yeah.

04:18.24
Sachin Sharma
So, um um yeah, super, super interesting stuff.

04:18.45
Natalija Pavic
Yeah. Yeah. That’s cool.

04:22.80
Natalija Pavic
This is like a, you know what, we’ll just have a separate pod episode where we just talk about this.

04:25.48
Ty Sweet
Yeah.

04:26.22
Sachin Sharma
Yeah. ha

04:27.58
Natalija Pavic
I think, yeah, well like when you said what is art, I was like, oh, I have like 10 million things to say about that. Yeah.

04:32.47
Ty Sweet
I feel like i I need to add to my reading list now.

04:32.54
Sachin Sharma
Yeah.

04:34.67
Ty Sweet
Like I need to to write some of these books down. I feel like I’m not part of the Cool Kids Club right now.

04:37.90
Sachin Sharma
Oh, man.

04:38.35
Ty Sweet
So

04:38.46
Sachin Sharma
No, I mean, if you if you have a bunch of time to s sink into it, you know, yeah, it’s not the lightest reading.

04:39.33
Natalija Pavic
I never read it. I i just name drop.

04:43.54
Sachin Sharma
Yeah.

04:43.84
Ty Sweet
OK, well, fair.

04:46.17
Natalija Pavic
It’s fascinating. um So obviously, you know, um that’s it’s so cool to have somebody like that leading our product strategy um and The latest announcement is of course dropshipping and marketplace.

05:01.29
Natalija Pavic
So I’m going to bring it back to that.

05:01.62
Sachin Sharma
Yes.

05:05.66
Natalija Pavic
Tell us a little bit about what this is. So let’s talk, the let’s just talk definitions since you were talking about defining terms.

05:12.24
Sachin Sharma
Yes.

05:12.44
Natalija Pavic
Let’s define dropshipping and marketplace.

05:15.24
Sachin Sharma
Yeah, absolutely. No, great question. as And as both of you know, because we talk about this so much at the intersection of like product and product marketing and you know clarification of terms, glossaries, you know really important for having like a shared understanding of what we’re talking about and kind of a shared language. so Let’s dive into it. So like on, um in terms of what we’re doing and how we define these terms, right? So dropship would be, um you know, a case where you have, let’s call it an operator, like, or, you know, in this case, a retailer, which would be Kibo’s client.

05:44.50
Sachin Sharma
And then you have a seller or what’s typically referred to as a trading partner or vendor supplier or dropshipper, right? And that’s all the person who’s ultimately fulfilling the transaction and the product.

05:55.50
Sachin Sharma
So in this case, Kibo’s client would list a product on their website. That would be a third-party product that they would dictate the pricing of that product, any promotions that run on that product, et cetera.

06:07.82
Sachin Sharma
And ultimately, the transaction would be sold booked on their website. That order is going to come in. Let’s say it comes into the Kibo OMS. And then the dropshipper, the trading partner, is alerted.

06:21.51
Sachin Sharma
that there is an item in a shipment after it’s been routed in the OMS that they need to fulfill. So there’s a communication that is made to their fulfillment system, or they could you end up using Kibo’s portal, the seller side of Kibo’s dropship capability, and ultimately fulfill that product, right? Pick it, pack it, put a ah ah a label on a shipping label on it, and then send it out to you, know you Nat, as the customer. You receive it at your door, right?

06:47.50
Sachin Sharma
um So that’s the programmatic sort of drop ship use case. And the module that we’re building works very nicely and has some crossover with our e-commerce capabilities and then a lot with our OMS capabilities.

06:58.97
Sachin Sharma
on the marketplace side. So that is a bit of a different story. And in this case, what we are talking about, really what’s really important to point out the beginning is we’re not talking about listing product on third-party marketplaces, such as an Amazon or Walmart marketplace or a Newegg, et cetera.

07:18.80
Sachin Sharma
That is super important. There’s already very good ways to do that, many of which we already have accounted for. This is allowing one of Kibo’s clients, again, the operators, of the marketplace to turn their storefront into a marketplace.

07:32.61
Sachin Sharma
And so I’m a retailer, I have first party, you know, owned inventory that’s listed on my storefront, of course. And now I decide that I want to allow third party sellers to list their product assortment on my storefront.

07:46.45
Sachin Sharma
And financially, and from an ownership or responsibilities perspective, the seller, the trading partner, you know, is going to dictate the pricing of that product and promotions that run on that product when they are listed on my storefront.

08:02.17
Sachin Sharma
I’m the operator of the marketplace. When that product gets sold, I ultimately will take a commission of that sale. And the commission might be calculated in a bunch of different ways. It could be based on the unit price of the product. It could be on the discounted price of the product. It could be factoring in tax and shipping costs. It might be net of those things. And so there’s a lot of configuration as to how that calculation actually works.

08:26.74
Sachin Sharma
But I, as the retailer or the operator of the marketplace, get a commission of that product that is sold. Ultimately, there’s some financial reconciliation on the back end. And then in terms of the fulfillment, everything works the same as a drop shipping workflow or use case.

08:41.02
Sachin Sharma
That product would come into the OMS, it would be routed, it would be assigned to a location that would kick off a communication to the seller, the trading partner, that there’s something that they need to fulfill. And then they would ultimately fulfill that product and it would end up at you know your doorstep now as the customer.

08:56.59
Sachin Sharma
So um both of these models, right and they really are sort of business models or extensions of business models, right it’s about expanding product assortment and really how you do that and who has the ownership over that and you know who’s doing things like dictating product content, pricing and promotions, et cetera.

08:57.52
Natalija Pavic
Right.

09:15.44
Sachin Sharma
and In one case, it lives with the operator. In the other case, it lives with the seller. Of course, the operator still has you know some ownership over that in terms of categories that things are listed in maybe and and some other things like that. um Both of these things are going to be covered through our offering.

09:28.90
Sachin Sharma
And I’m sure we’ll talk about this through the rest of the conversation. But you know development and sort of first release will be on the dropship capabilities. And then thereafter, we’ll move on to the marketplace capabilities.

09:40.35
Natalija Pavic
It’s fascinating because this is a like a huge announcement and we know the players that are in this area and thank you for that definition.

09:41.33
Ty Sweet
Thank

09:47.43
Natalija Pavic
um Now, obviously, both of these use cases are dealing with third party supply and leveraging third party supply, which is I know is very topical right now as supply chains are sort of in in flux for a variety of reasons.

10:00.51
Natalija Pavic
um And just to summarize what you said, just to clarify the definitions, in a dropship scenario, the seller represents the item, picks the suppliers, sells the item on behalf of suppliers.

10:11.28
Natalija Pavic
their marketplace scenario, you could have multiple brands representing themselves on the website and it’s kind of clearly stated that they’re handling. And there may be a situation which you can’t have like duplicate supply because you might have different items competing.

10:22.55
Sachin Sharma
Absolutely. That’s entirely possible.

10:24.45
Natalija Pavic
Yeah.

10:24.55
Sachin Sharma
Yes.

10:24.83
Natalija Pavic
Okay. um You know, it always like the pace at which you and your team work is always baffles me. And I haven’t been here long enough. So I’m not jaded yet. Like Ty, Ty’s a little bit jaded, but I’m still like, I’m still pretty impressed.

10:37.82
Natalija Pavic
um Why Kibo? ah I guess why, what gave you the confidence that to be like, yes, we can build this, this year. Let’s do it.

10:46.28
Sachin Sharma
Yeah, absolutely. No, it’s a great it’s a great ah question. And yes, quick plug for our entire product and engineering organization. I mean, everyone is working tirelessly to, you know, really innovate at a very fast clip, right? And, you know, I think we’ve done that now for several years and have a really good track record of doing it. And that’s partially what provides us with the confidence that we can do this is knowing that we have solved really big, hard problems consistently and quickly for the last two, three, four, five years, right?

11:18.39
Sachin Sharma
And so that that gives us the confidence that we’ve got the right team and the ability to do this. In terms of a lot of the other vectors that we looked at, right? So when we think about our platform.

11:29.70
Sachin Sharma
We’d really have one platform, and some of the listeners and the viewers might be less familiar with Kibo. We have a single technology platform from which we deploy a common set of microservices that power yeah at least one individual service, which some clients might buy one or two or three individual services from us, or they can be packaged into prepackaged business capabilities or PBCs.

11:52.70
Sachin Sharma
Those can be packaged into solutions or products or offerings like an e-commerce platform and order management system, et cetera. And then we have some clients that end up buying multiple products and eventually the entire platform, which, you know, many clients have been known to do.

12:09.13
Sachin Sharma
And so and as we think about the the platform, right, we go through every single year a pretty rigorous process in our roadmap to think about how we want to enhance the platform and our offerings. And some of those might be small features, medium-sized features, large features.

12:23.84
Sachin Sharma
And every couple of years, we release entirely new modules. And this would be a prime example of that. As we think through that, we really take a view um that’s like pretty common in growth strategy and thinking about your product and you know expansion from a strategy consulting perspective in terms of looking at the adjacencies.

12:44.01
Sachin Sharma
So we have a core platform today. ah we know who the buyers of that platform are. We know who the users of that platform are um through all of our extensive work out in the market ah with retailers and B2B organizations and 3PLs and other clients of ours that we have.

12:59.99
Sachin Sharma
And then we take a look at what other offerings are adjacent That would have a high amount of value for our clients to be able to consume where we know people are looking to solve pain points that are out there in the market.

13:15.43
Sachin Sharma
And dropship and marketplace is a prime candidate that sort of satisfies all of those conditions. Marketplace can pretty easily be thought of as an extension of an e-commerce platform.

13:28.02
Sachin Sharma
What do you need to make it work? You need catalog management. You need assortment management. You need complex pricing configuration. You need complex promotion configuration. You need cart. You need checkout.

13:40.24
Sachin Sharma
We have all those components. You need some set of UI and workflow to onboard vendors to kind of cleanse product information and then translate into the merchandise catalog that is powering the storefront.

13:54.50
Sachin Sharma
And so there’s only a little bit of new stuff that we have to build to make that work. On the dropship side, you need the ability to take in orders, to be able to break up the line items in the order, to be associated with locations that carry first-party inventory,

14:10.70
Sachin Sharma
locations that carry third-party inventory. We have all of that in our market-leading OMS. And so the part that we have to build are the integration capabilities. EDI is very important in dropship and in marketplace, both in terms of how inventory is brought into the operators, you know, ecosystem of technology, how product or offer offering is brought in, ultimately how shipments are routed to the dropshipper, the supplier, the trading partner for purposes of fulfillment.

14:40.88
Sachin Sharma
and getting advanced shipping notices and invoices, things like that. EDI is very prevalent in the market, so that’s like a new capability and and integration protocol that we are supporting. And then similarly, a set of UIs that allow for trading partners to be onboarded to provide all the information that’s required to do that.

14:58.07
Sachin Sharma
ultimately to be approved, you know for product assortment to be approved and all these kinds of things. And so again, a very small amount that we need to build on the dropship side. It’s kind of support for EDI and it’s some new UIs and um you know dashboards for you know managing assortment, managing fulfillment of items and taking care of some edge cases that might come up.

15:18.70
Sachin Sharma
Lastly, we have a bunch of clients and prospective clients that are looking to modernize how they do EDI and how they do dropship.

15:30.49
Sachin Sharma
It happens to be a very common theme for the last 12 months and seemingly is going to continue for the next one, two, three, four years. And that is the final kind of piece of information that made it make a lot of sense for us to do this right now.

15:47.54
Sachin Sharma
So I’ll pause there. I know I just said a lot.

15:50.47
Ty Sweet
And it’s a great answer, Sachin. And, um you know, that a lot of that makes sense. And and I will echo, you know, I’m i’m kind of in the in the Goldilocks zone as far as ah you’ve been here seven years.

16:02.85
Ty Sweet
Nat’s pretty new. um’m I’m right at four years this this month. And so the amount of work that that product and engineering has done over the four years that I’ve been here is tremendous. truly impressive. Just the amount of updates you guys are pushing out constantly, ah whether that be new releases or or kind of tweaking other things is is is truly impressive.

16:22.02
Ty Sweet
And so I just, I wanted to echo what you had to say there as well. I’m not, I’m not fully jaded like Nat said, but you know, you know after you’ve been somewhere for a while, you kind of take,

16:28.14
Sachin Sharma
ah

16:30.18
Natalija Pavic
I shouldn’t have said that.

16:31.32
Ty Sweet
Well, I think it’s more you take it for granted. It’s like, what do you mean your company doesn’t push out you know ah new releases and updates the the every other week like we do?

16:34.72
Sachin Sharma
yes

16:38.99
Ty Sweet
like That’s just normal. like so um

16:41.34
Sachin Sharma
for sure

16:42.10
Ty Sweet
and and you know Dropship and marketplace are are words that that people hear a lot, especially especially when you get into the the e-commerce. I think everybody kind of has an idea of what dropship is, what marketplace is.

16:53.42
Ty Sweet
But Nat alluded to this a little bit earlier, and it kind of tweaked this it kind of sparked something in my brain about… Some of this is a lot of this is changing now because of the world that we live in and and dealing with tariffs and a lot of this other stuff. And so, you know, kind of how are people doing this now, Sachin? Like, what are people doing, you know, with Dropship or with Marketplace currently in the market?

17:16.18
Sachin Sharma
Yeah, no, it’s it’s a great it’s a great question, Ty. I mean, I think it picks up really nicely on kind of what I was just talking about in terms of people are looking to modernize these things. And so that begs the question of why, right?

17:27.41
Sachin Sharma
And so today, um a lot of, especially Dropship, you know I’ll take that space because again, it’s sort of the first thing that we’re releasing and it’s very top of mind at the moment for me right now.

17:39.43
Sachin Sharma
A lot of people have thought about, you know, or retailers, B2B organizations, et cetera, have thought about solving Dropship as you know being a question about how did push EDI messages around.

17:53.62
Sachin Sharma
And EDI is a very old communication protocol. It is extremely pervasive. It has sought served a wonderful purpose in the market, in the world, and it continues to.

18:06.08
Sachin Sharma
The technology, though, because it is pretty old, it’s been around for a long time, those solutions where people build EDI integrations have become, at this point in time, many of them have become, a bit long in the tooth. or people have built these you know integrations themselves, and then you have a lot of people maintaining, enhancing something that’s pretty old.

18:30.02
Sachin Sharma
There’s a lot of costs associated with that. Even if they’re using sort of more of a platform vendor, there’s still a large amount of overhead and cost and time and effort that’s required to do that.

18:40.98
Sachin Sharma
And really, you have solved a business model challenge by focusing on an integration concern. And so all of those things together are what’s requiring or pushing people to modernize now because there’s a lot of money in overhead that they’re sinking into it.

18:59.83
Sachin Sharma
How they’ve done these things is also more oftentimes than not built on the back of their yeah ERP, which they might’ve had for 10 or 15 or 20 25 years or Even we have clients right who are buying modern SaaS applications in commerce, whether that’s e-commerce or that’s order management or that subscriptions.

19:22.33
Sachin Sharma
As a part of the mock alliance, some of our clients and prospective clients are looking for the most cutting edge innovative technology in the market in the commerce space.

19:33.56
Sachin Sharma
At the same time, many of those clients have you know yeah ERPs that have been around for a long time. Several of our clients still on mainframe AS400. right and so They have built these integration points leveraging EDI on the back of the ERP.

19:50.96
Sachin Sharma
They’re going through modernization ah journeys, whether that is in the core commerce cap ah you know area or on the adjacency and on the fringe close you know fringe, close adjacency, which I would consider dropship marketplace to be.

19:59.05
Ty Sweet
Thank you.

20:06.12
Sachin Sharma
and so that’s That’s what they’ve done, right? they’ve They’ve kind of built something in their in their yeah ERP, either customized it, built it themselves, gotten a third-party platform, but they did that a long time ago.

20:17.29
Sachin Sharma
It’s tough to pick apart. It’s tough to maintain. It’s tough to enhance. It might be a very long process to onboard a new vendor. We have clients who tell us that it could take them as much as two or three months to onboard a new supplier, you right? So…

20:32.53
Sachin Sharma
that is a lot of the pain point that they are solving for. It’s cost, it’s time, it’s customer experience. And ultimately they’re enhancing and they’re expanding product assortment because they want to drive more revenue.

20:45.19
Sachin Sharma
And so that means if it’s taking you two or three months to onboard a new vendor, that’s real opportunity cost. presumably you’ve done the business case that says, if I onboard this product assortment from this vendor, I’m going to generate X dollars more in revenue.

21:00.33
Sachin Sharma
And the cost that goes into that, you know it’s going to be profitable. That’s why you’re doing this in the first place. Or it has some kind of strategic benefit. Maybe it’s not profitable. Maybe it’s minimally profitable, but it does something to enhance your brand.

21:11.85
Sachin Sharma
There’s some clear ah ROI. That’s why you’re doing it in the first place, right? And so now there’s real opportunity costs the longer it takes or the higher the cost is. And so that’s what folks have done.

21:22.94
Sachin Sharma
That’s why they’re looking to modernize and then kind of drawing the through line to what we’re building and how it solves these things. Because it’s On our platform, it’s not even pre-integrated, right? Like those are sort of bad words at Kibo. Our e-commerce platform is not pre-integrated with our order management offering. It’s all on the same platform.

21:42.29
Sachin Sharma
There’s no integration. There’s one order that comes in and is created through the checkout object and then it’s in the order service and it’s there for the OMS. Same exact concept for the drop ship and the marketplace module.

21:55.63
Sachin Sharma
So that means… If you’re using our core capabilities, which power this stuff, and you know you buy the module and we turn it on, there’s no integration work to do between the parts of Kibo you already use and the new module.

22:10.02
Sachin Sharma
And so point number one, no integration work to do. That’s huge cost savings in you know versus the maintenance of those programs today. Two is The licensing cost is much more palatable than what people are currently paying for some of these older technologies, right?

22:28.95
Sachin Sharma
And, you know, that’s a common thing in software. The newer stuff generally tends to be cheaper because it’s been easier to build as technology has become more ubiquitous. And now even with Gen.ai stuff is even faster, right?

22:39.59
Sachin Sharma
And so part number three is the speed. With our platform, something like vendor onboarding would take two weeks, even if that integration is through EDI. And if it’s you know someone who’s using the portal that we’re going to provide, then there’s really nothing to do.

22:55.28
Sachin Sharma
If ah the data is coming in via EDI, we have to build that EDI connection. That’ll take maximum two weeks, not two months, not three months. And so now you have a lot less opportunity cost. You have lower cost overall.

23:07.87
Sachin Sharma
You get otherwise whatever revenue you are going to get even more over the same time frame because you’ve onboarded faster. And so that is a lot of what is driving the extremely high interest in our client base and our prospective client base around our dropship application. And you could take all of those same concepts, extend it to marketplace, and it’d be the same exact picture.

23:29.09
Ty Sweet
Yeah, and that totally makes sense. And and you’re right. The the integration of OMS was done when it was built into the platform, right? So there’s there’s no integration there. That is pretty funny.

23:38.33
Sachin Sharma
Yes.

23:39.57
Ty Sweet
You mentioned modernization there a lot. And so i’m going you know my assumption is going to be that the drive to do that modernization is because it’s been very difficult for a lot of retailers to work inside these legacy systems that they built out. Is that correct?

23:57.09
Ty Sweet
is that Is that assumption correct?

23:58.21
Sachin Sharma
Yeah, absolutely. Absolutely. it takes time. it takes, you know, money and it takes like a special skill set, right? Of, you know, folks that are sort of just doing that all day long.

24:05.08
Ty Sweet
Right.

24:08.57
Ty Sweet
Yeah, totally. And so that kind of leads me to my next question. If somebody spent a lot of that time and money and, you know, blood, sweat and tears to kind of build these drop ship and marketplace programs out, why would they care about the modernization? Like, what are they getting out of the modernization of these platforms that Kibo’s offering?

24:25.58
Sachin Sharma
Yeah, absolutely. I mean, the really, really big one is is speed, right? And so again, the vendor onboarding, like as if you’re running a dropship program, of course, table stakes, you care about the customer experience. Customer experience should always be phenomenal.

24:42.48
Sachin Sharma
That ultimately is what is going to drive you know revenue capture to begin with and then follow on transactions, right? And that’s super important. But how do you actually unlock that product? I can’t sell the product unless it’s actually on my storefront.

24:56.14
Sachin Sharma
And the faster it is, the more of it I could sell, presumably. The earlier I could sell it at the very least. And so the speed of onboarding is one really clear reason that we hear over and over again why retailers, you know brands, B2B organizations want to modernize on dropship.

25:15.16
Sachin Sharma
these V eCommerce, right? So that’s a really, really big one. The second one is um that customer experience in and of itself, right? Because we have a lot of advanced capabilities in our OMS, which drive conversion and loyalty and repeat buys for first party owned inventory.

25:40.37
Sachin Sharma
retailers, brands, B2B organizations, whomever, want to capture that same benefit on third-party non-owned inventory. Because there’s a lot of really interesting things we could do, as you both know, like real-time inventory visibility all over the storefront throughout the entire browse journey.

25:55.81
Sachin Sharma
We know that drives a tremendous amount of conversion. That’s one super easy thing. Let’s just take that. I don’t even have to rattle off the other five or 10 or 15 things. If you could do that for first party inventories driving conversion, you know that.

26:08.18
Sachin Sharma
Now I want to do it for third party on an inventory as well. And there’s nothing stopping them from doing that other than perhaps some legacy systems, right?

26:18.71
Sachin Sharma
And so getting that benefit as well drives a ton. The third piece And this goes back to something I mentioned earlier, is you know Dropship, Marketplace, these are business models. These are revenue channels.

26:31.17
Sachin Sharma
And they’ve been classically thought of as being solved through an integration protocol. right And with our application, there’s a lot more sort of ah built-in capability for business users to do things like actually manage the suppliers and the relationships.

26:50.64
Sachin Sharma
And so when you think about onboarding a new supplier through a visual workflow that tells you where in that workflow you are, have you gotten all of the requisite documents from the trading partner?

27:02.58
Sachin Sharma
Is everything populated properly? How am I going to get my manager to approve it after I approve it? How am I going to send it back to the trading partner to tell them they forgot to fill out this one field or that we need extra information because they said this and now that’s kicked off another review cycle where I need to go ask them for another asset more collateral, right? How do you do things like manage SLAs, right?

27:26.61
Sachin Sharma
Like once you route a shipment to them that they need to fulfill, how long they’ve taken to do it, did they adhere to the time that is set out in a contract? Did they fulfill it within 24 hours or 48 hours?

27:37.85
Sachin Sharma
Did the customer receive it in a good fashion? Like we hear all the time that some of these things, um some of these dropship um transactions, customers are receiving things that are like poorly packaged.

27:53.17
Sachin Sharma
or they’re damaged, right? And that happens to happen more often with the third party fulfilled product than the first party fulfilled product. And so there’s something that might be going wrong in the process there.

28:05.49
Sachin Sharma
How do you get that data, get the feedback loop, understand that it happened, track it, give that to your you know vendor management team to actually manage the trading partner more effectively?

28:16.09
Sachin Sharma
Because those… experiences ultimately are impacting your brand. The transaction happened on your website. And so that would be like the third piece. So those are three, in my mind, like really huge, important business drivers that are driving the modernization from a you know business benefit perspective. Those are the three of the main things we see occurring over and over again.

28:40.96
Sachin Sharma
in the internal business cases that our clients, prospective clients are using to kind of, you know, underpin the dropship modernization, the marketplace modernization, the EDI modernization, however you want to think about it.

28:54.88
Natalija Pavic
So, you know, a lot of the stuff you mentioned, it makes me realize, um you know, and this is all due to the work that you and your team have done here over the years, is that we’re one of the few vendors actually that have everything on the same stack. The world is kind of divided into either um solutions through acquisitions and mergers or through point solutions that do one thing and then partner for everything.

29:18.19
Sachin Sharma
Yes.

29:18.35
Natalija Pavic
And so we’re in this kind of, if I could use Ty’s word, Goldilocks spot where we are increasing in the commerce category, any adjacent commerce category, but we’re still very much building on the same tech stack. And you mentioned Sachin, some of the reasons why ah you’re doing that.

29:35.85
Natalija Pavic
Now, I do want to call out OMS. I know we’re a little bit different in the commerce space because we’re very um you know, dominant in the OMS aspect of the product.

29:48.10
Natalija Pavic
So tell me ah little bit about the importance of OMS and all this, because my understanding, you can correct it, is that EDI is in essence really a function of order routing. So tell me about that adjacency and the importance there.

30:00.45
Sachin Sharma
Yeah, 100%. So this is one of the things that has resonated so well yeah with all of our clients and prospective clients to whom we have you know talked about and shown what we’re building, specifically on the dropship side and its intersection with order management.

30:22.32
Sachin Sharma
And one more thing I’d note is that, you know, something that we all talk about a lot, you know, myself, Tom Phipps, our CTO, and then Ram, Venkatraman, our CEO, who was previously our chief product and technology officer before he took over as CEO, is in all the time that we’ve been here, and we’ve all been here for seven, eight, nine years, depending on which of those people you’re talking about, this is the most demand we have ever seen for a product pre-release.

30:49.34
Sachin Sharma
And The reason is exactly linked to the question that you just asked that. And so if if we forget about even if you’re using Kibo, let’s zoom out a little bit.

31:02.98
Sachin Sharma
As we think about dropship, dropship is pretty like narrowly in terms of the way that it’s used typically, a transaction that is occurring online where it is not fulfilled by you as a retailer, but it is fulfilled by third party, one of your trading partners.

31:19.28
Sachin Sharma
And so that means that you’re already talking about the commerce landscape. The order is occurring online, right? That’s where the transaction is happening. It’s being placed. It’s coming into some sort of a inventory management and fulfillment management system.

31:35.43
Sachin Sharma
If we talk about it abstractly, let’s not use the word OMS. Then today for almost everyone, that order is going into the ERP. And from the ERP,

31:49.37
Sachin Sharma
it is translated into usually an EDI communication to the trading partner that says, here’s the purchase order, right? And then the trading partner says, I’m acknowledging I received the purchase order.

32:04.60
Sachin Sharma
Then they send you the advanced shipping notice, you know, transaction, EDI transaction. And then they ultimately send you the invoice transaction. And then there’s a financial settlement reconciliation.

32:18.61
Sachin Sharma
Now, that’s the the broad or you know landscape workflow and system responsibility. Now, if we get a little bit more specific in terms of the Kibo landscape and the surface area that we that we’re living in.

32:32.56
Sachin Sharma
If you are using OMS, that means all of your e-commerce orders are coming in to the OMS at a minimum. Other order channels might be coming in as well, but at a minimum, all e-commerce transactions are coming in. That’s the virtue, core virtue of an OMS.

32:46.06
Sachin Sharma
We have all of the inventory. It’s all at a location level, and it could be segmented through the roof, right, in all sorts of ways and granularly managed and all of that. We have all the locations that carry inventory and that fulfill inventory and all of the rules that determine you know which locations can do in-store pickup and ship to home and transfers and send transfers and receive transfers.

33:09.32
Sachin Sharma
And then we have all of the order routing configuration that ultimately determines how is this item going to be routed to a location for the purposes of fulfillment. And so that means that today,

33:20.61
Sachin Sharma
for any of our clients that are using our OMS, any of those products that are being drop shipped, they’re already coming into the OMS in an order. They’re already being routed to a location in the OMS, which represents the trading partner or the, you know, drop shippers location.

33:37.60
Sachin Sharma
From there today for all of our clients, because we don’t right now offer a drop ship application right in production, For whatever, you know, not for whatever reason, for good reason, those ah items that have been assigned to the third party location go to the ERP and then they go through this EDI, you know, jump, whether that’s built in house or through a third party legacy application.

34:01.83
Sachin Sharma
And it goes to the trading partner and the rest of the, you know, back and forth occurs, as I mentioned previously.

34:09.19
Sachin Sharma
If you have all of those EDI pain points because you did this over the course of 20, 25 years on your yeah ERP as we talked about, and you know all of the hindrances and you know you’re being hamstrung in all these ways that we talked about.

34:23.73
Sachin Sharma
and we already have the inventory locations, the order routing, the assignment, we’re making the assignment decision already. You can cut out that entire loop of going to the ERP, going through your kind of legacy EDI setup and just go straight from the OMS.

34:42.47
Sachin Sharma
And so that is why our order management clients are so excited about this because they want to modernize their dropship programs for other reasons that have nothing to do with Kiba, which we discussed a little bit earlier.

34:59.42
Sachin Sharma
And doing it straight out of the OMS and on the back of the OMS versus the back of the yeah ERP makes complete sense for the reason I just articulated from a workflow perspective.

35:11.55
Sachin Sharma
And as we all know, and anybody who’s listening who you know works in the intersection of technology and commerce, um people, practitioners, right, in our industry, like to put things in places where they logically belong.

35:27.53
Sachin Sharma
So that’s always the right thing to do. And there’s just so much sense in… having that transaction come into the OMS, routed in the OMS, and all the communication between the retailer and the dropshipper occurs between the OMS and the dropshipper versus going through this weird loop through the yeah ERP and then through something else.

35:50.29
Sachin Sharma
And then additionally, you get all of the very nice user information um benefits, right, of all of the UIs that we’re going to have in our platform, right? We have one common admin UI, one login.

36:05.94
Sachin Sharma
People are already using that. You come in there, there’s going to be a new tile for, you know, dropship management. Hit that, boom, open up your operator portal, have all of the intelligence of your entire dropship program right there, see all of your tasks, everything you need to do.

36:14.27
Natalija Pavic
you

36:21.33
Sachin Sharma
Maybe there’s a new vendor that you’re onboarding that you need to advance the workflow on. Maybe there is an issue with some data that you’re trying to remediate. Maybe you are trying to manage some part of the catalog assortment to bring it into the Kibo catalog service and then expose it on the storefront.

36:38.38
Sachin Sharma
All of the stuff built in the platform that you’re already using. The integration point is right there where it logically belongs. And of course, you know very, very new, fresh technology, multi-tenant SaaS, API first, you know cloud native, all of these wonderful benefits that we already know that we already provide.

37:01.95
Sachin Sharma
And key to remember the backdrop of you already have all of these pain points with Dropship and EDI that have nothing to do with Kibo.

37:09.98
Ty Sweet
Thank

37:10.54
Sachin Sharma
And so um you know there’s a clear need if you’re using ROMS. There’s just so much synergy, as I articulated.

37:21.30
Sachin Sharma
that was a long answer, but hopefully it was clear.

37:23.52
Natalija Pavic
It was ah packed with gold. i can tell you that. that’s ah it’s ah It all the needed to be said and understood. um Now, you’ve talked a lot about how how you build dropship marketplaces, why, et cetera. um can we let Let’s abstract that.

37:37.26
Natalija Pavic
um yeah As a you know leader and executive here at Kibo, what’s your overall approach to product management and how do you think about building product at Kibo?

37:46.31
Sachin Sharma
Yeah, absolutely. That’s a great question. So um we look at things in so many different ways. I mean, basically the easiest way to explain it, I think, would be what we do for our roadmap process.

37:59.50
Sachin Sharma
And you know this is something that has changed and it’s morphed and it’s evolved over time, certainly over my seven years here. And we are now kind of on a new footing that we’ve been pursuing for the last few years. And it’s been working really well based on all of our client feedback.

38:15.17
Sachin Sharma
um And so basically what we do is every single year starting in kind of, you know, August timeframe. So we’ll be kicking this process off in a couple of months here. We start to think about the next calendar year and what we’re going to build.

38:30.13
Sachin Sharma
We go through a very detailed rigorous process on the product team to take in you know a bunch of requests from clients, to look at current capabilities that we have, source ideas from the full Kibo employee base.

38:44.50
Sachin Sharma
It doesn’t matter what function you work in. Everybody has a very good point of view in terms of like how we can answer a product.

38:48.51
Ty Sweet
you

38:51.07
Sachin Sharma
We’re a very product-centric company, as you you both know. And so um you know products at the forefront of everyone’s mind. We talk to analysts, we look at what our competitors are doing, um and we get feedback from even prospective clients. right And so we take all of these ideas, we kind of like stack rank all of them in terms of how valuable we think they would be to our client base, to the market, and sort of to our strategy.

39:14.73
Sachin Sharma
And then, you know, we size all of them. We understand how much capacity we’re going to have on the team. And we sort of prioritize that list. And then we phase it in the way that we think, again, is going to be most impactful to the market, to our clients. And what a good example or good lens we put on that is if we’re going to do, a you know, big stuff, we should do it earlier in the year so that people could take advantage of it.

39:37.97
Sachin Sharma
Because as we know, a lot of our clients, they don’t want to make huge, broad changes to their business and their e-commerce channel the further we get into the year. right Many of our clients have a sort of a typical peak overlapping with holiday season.

39:50.09
Natalija Pavic
Thank you.

39:52.83
Sachin Sharma
And so that means you know by the end of the summer, no one wants to make you know have any tectonic shifts in there in their e-commerce operations or their business models. So we try to get big stuff out early.

40:04.37
Sachin Sharma
um We go through that process and ultimately end up balancing our own point of view of how we think we should push the platform forward, kind of going through that framework that I discussed earlier you know in our discussion about thinking through adjacencies and enhancing the platform and what’s going to be impactful from our point of view with what we know our clients are interested in.

40:30.16
Sachin Sharma
And so as a you know multi-tenant SaaS vendor, the great thing about that and the promise of multi-tenant SaaS has always been that when you pay your annual licensing fee, you are also funding innovation on the platform and you’re getting everything in the next release, right unless there’s a new product being built essentially.

40:54.90
Sachin Sharma
But enhances to existing product enhancements to existing product you get that you know in the next release and we release every two weeks. And so that means that taking client feedback is extremely important.

41:08.12
Sachin Sharma
There are some people who view it almost as like a bad thing, like, oh, you know you’re listening to your clients or your clients are dictating what you do. Our clients are absolutely not dictating what we do.

41:21.34
Sachin Sharma
you know No one can force us to do something, but it is only right and fair. if we listen to our clients really, really closely and we take their feedback very seriously and we action on some very healthy percentage of it.

41:38.46
Sachin Sharma
And so this last year, this year, the amount of innovation that’s being driven by clients you know, in terms of their requests, right? It’s anywhere from like 40 to 60% of what do we do in a year based on the year that you’re looking at. And I think those are really healthy percentages.

41:58.03
Sachin Sharma
um and prove a lot of the kind of the value of Kibo in terms of how we operate as a business and also make good on the promise of multi-tenant SaaS, in our opinion, in terms of providing that innovation and making sure that you are getting benefit on an ongoing basis for what you’re paying for. It’s not just the version of the product that you bought.

42:19.70
Sachin Sharma
from Keybone 2021. Now you’re sitting in 2025. We’ve released every two weeks over that four-year period. It’s a completely different product. And you, in many cases, might be paying us the same exact amount of money. And that’s great.

42:34.03
Sachin Sharma
We want to be providing more value to our clients incrementally. And a lot of that is driven by us and what we think and where we want to go and strategically, you know, how we enhance and augment our business.

42:44.44
Sachin Sharma
And then a lot of that is driven by clients. And also the last thing I’d say is we don’t ever build, let’s say, exactly what a client is asking for. And I think that’s a good thing, too.

42:54.99
Sachin Sharma
Right. We have to be the arbiter. of ultimately what goes into the platform and how it works, which is critically important. It must work well for all of our clients.

43:06.80
Sachin Sharma
And so sometimes we get very narrow requests, you know add a feature that does this and it works in this exact way, and here’s how you should change your UI. We kind of take that and we abstract it up multiple levels.

43:20.17
Sachin Sharma
We solve the problem in a way that’s going to be impactful for all of our clients because no one client has the knowledge of all the other clients. That means that if they are giving us an idea, even if it’s incredibly valuable, we might not follow exactly the behavior that they’re intending or the how, right? Or we might make it more configurable. We might make it more abstract because we know the other use cases that are out there in the client base and out there in the market that are going to be impactful.

43:46.34
Sachin Sharma
And so, That is, i would say, very fundamentally how we think about our product philosophy and sort of you know our relationship with our clients. And the the final thing I would say is I think that’s also been noticed by the metrics of our business. We have amazing client retention rates year over year, which we’ve had for the last several years.

44:09.78
Sachin Sharma
We have been recognized by clients. to us right directly in terms of they love the amount of collaboration, feedback, innovation on the platform that they see, having their voice heard. And then finally, even through independent recognition, you know the most recent Forrester order management wave that came out, Forrester added this really cool new dimension that’s kind of like client centricity or in client feedback. And they used to have kind of two axes and then the size of your bubble was like how big you were on a revenue basis. And they’ve now added this concept of like a halo around the vendors, you know, bubble where they place them on the, on the diagram, on the wave that represents customer feedback.

44:53.89
Sachin Sharma
And Kiba was the only vendor in the most recent OMS wave that earned that designation of a halo. And there’s other great companies in the wave.

45:04.89
Sachin Sharma
They’re doing really good things. But when the Forrester analysts spoke to our clients, our clients showed materially higher level of satisfaction and represented their relationship with Keebo as being materially healthier than our competitors’ clients when they spoke to the analysts.

45:24.91
Sachin Sharma
And so I think it’s also shown there, right? And so, you know, this is our philosophy. This is what we pursue. It might sound odd to other vendors. We don’t really care about that. Our clients love it. It works well for us.

45:37.45
Sachin Sharma
um And it’s, you know, proven to be great for us and very successful.

45:43.14
Ty Sweet
Yeah, and i I think that’s all huge, Sacha. And I want to kind of drive home a couple of the things that you’ve said, right? Because again, the Forrester thing was huge. when we when When that came in, we were so excited about the fact that we were the only one that had that halo, right? And it goes back to that idea of customer retention. We all know that our customer retention is very high, way higher than than than pretty much everyone else in the industry.

46:04.31
Ty Sweet
And I think there’s a lot of… of reasons behind that, but I really want to touch on some of the answers that you just gave that can just kind of drive these home, right? 40 to 60% of our roadmap is coming from customers. That’s huge, right?

46:15.77
Ty Sweet
um We’re releasing every two weeks. ah And because of that, everyone that is on our platform is on the same version of the platform, right?

46:27.08
Ty Sweet
There’s no costly upgrades to to get caught up to everything else, right?

46:29.43
Sachin Sharma
Yep. yep

46:31.60
Ty Sweet
And there’s caveats to some of that stuff for sure. But those those i think those things are huge and speak to a lot of why Kibo has been very, very successful, especially in the last few years.

46:43.93
Ty Sweet
And and really, our our customers are really seeing that. And I think that’s a lot of what you what you’ve said. um Nat, you have something you want to throw in there?

46:53.60
Natalija Pavic
Yeah, I was testing out the hand raise function. Thank you, Ty.

46:56.91
Ty Sweet
Yeah.

46:57.21
Natalija Pavic
um I just wanted to add to that and say like what a novel concept to listen to your clients.

46:57.26
Ty Sweet
Yeah.

47:01.53
Natalija Pavic
it It sounds so weird to say that in this day and age because I think a lot of companies are driven by net new customer acquisition and they really focus on what can we build to get new clients as opposed to building with the existing client base.

47:15.87
Natalija Pavic
and I just find that so refreshing. I find it refreshing that I now work at a company that does business a little bit of the old school way of like actually putting power in relationships and power in trust and transparency.

47:24.47
Sachin Sharma
right

47:29.55
Natalija Pavic
And so just want to say thank you. Thank you, Sash, and thank you, Ty, as well for for being here and and and being awesome.

47:32.84
Sachin Sharma
ah

47:36.59
Sachin Sharma
Of course. Yeah.

47:37.52
Ty Sweet
Hey.

47:37.51
Sachin Sharma
Thank you guys.

47:37.65
Ty Sweet
Yes.

47:38.15
Sachin Sharma
And, and the, you know, to that point, Nat, I think it brings up a really good question in terms of like the observation you just made.

47:38.63
Ty Sweet
yeah

47:46.19
Sachin Sharma
to kind of stitch all these concepts together, right? Like we have a defined space in the market. It’s a large space, but we have kind of picked, you know, large sizable space in the market where our prospective clients look a lot like our existing clients.

48:04.85
Sachin Sharma
And so that’s what makes it work, right? At the end of the day, like there’s a lot of product strategy that’s made its way to go-to-market strategy that’s made its way to implementation, you know um strategy and operations really, and then how we service clients post-go live.

48:25.51
Sachin Sharma
And we’ve spent a lot of time on that journey and that through line and all of the feedback loops that you know bridge off of that diagram in so many places in the in ah whole process and lifecycle of a client, their relationship with Kibo.

48:41.38
Sachin Sharma
And that’s really the reason why it works. And so like I know, we all know, right, as we build a feature for one of our clients, invariably, a prospective client will also find it valuable and vice versa.

48:54.54
Sachin Sharma
And, you know, they might come in different scale and size and things like this, but conceptually, you’re the problem space that we’re working on is always most likely reusable, right? Way more often than not.

49:08.72
Ty Sweet
Yeah, that’s great. and And Nat, I will take the credit for Kibo being so successful while I was here.

49:13.52
Natalija Pavic
should.

49:14.10
Ty Sweet
So yeah, i’m I’m taking all of that credit for sure.

49:14.13
Natalija Pavic
You should.

49:14.41
Sachin Sharma
ah

49:14.51
Natalija Pavic
You should.

49:16.38
Ty Sweet
100% the customer retention, 100% this guy right here. So Nat, I hope you don’t mind. I’m going to take the last question. You had the first question. I’m going to take the last question.

49:24.74
Natalija Pavic
That’s fair.

49:25.36
Ty Sweet
um and And it’s not going to be as heavy as as getting into philosophy and all of that. Again, I like to ask this question because we are an e-commerce company and I feel like it ties a lot of this together. But Sachin, what is the last thing that you bought online?

49:40.63
Sachin Sharma
That is a great question. ah So…

49:43.48
Natalija Pavic
Thank you.

49:44.84
Sachin Sharma
um We actually just bought ah really interesting, um in terms of like from a e-commerce perspective, we just last night bought some services and some products together from a local business here in Austin, Texas, that is going to come to bring, you know, come to our house, bring us some ah really nice wall mounts for some TVs that we got and do all the installation.

50:13.61
Sachin Sharma
And so like we bought the services and the wall mounts and specified a bunch of other things, all in like this checkout experience that they had, which was super intuitive and scheduled the time for them to come, all this kind of stuff.

50:27.94
Sachin Sharma
And it was a great experience to see, like bridging the services aspect with the product aspect,

50:29.55
Natalija Pavic
Thank you.

50:33.24
Sachin Sharma
with some consultation. There’s like an ability, you know, there’s some things obviously that are unknown. You have to like figure out when you get to our house. And so there’s like some wiggle room on some things, some things we were able to specify and doing the scheduling and like all of it in one transaction. It was super cool.

50:48.00
Sachin Sharma
So it was the first time doing anything like that. ah So that is the last thing that we bought online.

50:55.91
Natalija Pavic
It’s so much cooler than my answer, which is dirt. I bought dirt online.

50:58.83
Sachin Sharma
but Ha ha ha ha!

50:59.88
Natalija Pavic
So…

51:00.79
Ty Sweet
Well, that is, yeah, that’s, so I bought a vest.

51:02.68
Sachin Sharma
Well, that is important.

51:03.37
Ty Sweet
So, but I needed a vest. So I needed it that. So yeah not super cool. Not like hanging TVs, but I get a vest.

51:11.15
Sachin Sharma
Yeah, that’s great. excited to see it.

51:12.14
Ty Sweet
That is great. Yeah. Oh yeah. Everyone’s going to see it. It’s going fancy.

51:16.18
Sachin Sharma
Nice.

51:19.67
Ty Sweet
All right. And on that note, I guess we’ll wrap this up for today. Thanks everybody for joining us. And we’ll see you next time.

51:28.59
Sachin Sharma
Thank you all. Thanks Nat. Thanks Ty.