Courier start-up Zoom2U’s acquisition delivers a freight option

On-demand courier service moves from parcels to pallets with its latest acquisition.

Zoom2U chief executive Steve Orenstein.

On-demand courier service Zoom2U has expanded its arsenal with the acquisition of Freight Match, a move that the start-up’s chief executive Steve Orenstein said was a significant step up for the start-up.

Melbourne-based Freight Match is an Australia-wide online service that matches transport operators with customers wanting to move goods.

Absorbing Freight Match’s network of more than 2000 transport operators into its business will see Zoom2U widen its scope from traditional courier services to interstate shipping. The terms of the deal were not disclosed.

“The Freight Match buy gives the ability to move from parcels to pallets,” Mr Orenstein told The Australian. “It also helps us improve on features that we already had but can become better.”

The deal also allows the start-up to further leverage its alternate delivery model into logistics, building on its recent deal with DHL in the parcels delivery area.

According to Mr Orenstein, Freight Match would enable the company to apply the same online booking and smart delivery-tracking features used in parcel delivery to the freight delivery industry.

“Much like courier delivery, freight transportation is an area that can be optimised significantly,” he said.

“The problem is that existing services use the same technology systems that were used 10 years ago, making delivery jobs unnecessarily complicated.”

Like all platform businesses, Zoom2U promises benefits for both parties in the transaction. Freight carriers get more value out of every route as they monetise spare capacity without having to chase clients. Meanwhile, customers enjoy lower fees as goods “hitch a ride” with vehicles that are already travelling to the required destination.

“The freight business has been a pretty slow adopter of technology, with many still using paper job sheets,” Mr Orenstein said.

“But things are changing and technology such as the routing engines we use provide a huge lift in efficiency.”

Lower prices are not the only benefit for customers, who also can track the delivery.

Tracking a delivery is not quite as simple as tracking your food order, but Mr Orenstein said the technology was there and customers now took real-time tracking for granted.

“The reality is that Australians have become used to tracking their taxis and food on a map in real time,” he said.

The acquisition comes not long after Zoom2U celebrated its third year of operation in Australia. Since Launching in 2014, the start-up has built a network of more than 500 couriers around the country and has raised $3 million in funding.

The company is now raising more funds to make the most of the “Amazon effect”. The US retail behemoth’s Australian entry has been a boon for Zoom2U and its peers as retailers look to lift their game to better compete with Amazon.

“Delivery is a critical feature of the retail journey,” Mr Orenstein said.

“Online retailers need to be looking at how they can overhaul their delivery infrastructure to match Amazon’s immediacy and breadth of shipping options.”