- Pirate Ship is a cloud-based shipping software provider for small and medium-sized businesses. The company was founded by Bjorn Borstelmann and Jameson Morris to simplify the order fulfillment process and give businesses access to cheaper shipping rates.
- Pirate Ship offers its shipping software for free, with no hidden costs, monthly subscription fees, or markups.
- Pirate Ship likely makes money on the difference between commercial shipping rates and the rates it can negotiate with carriers for sending business their way.
Borstelmann and Morris founded and advised some of the first subscription box businesses. In the process, they discovered how costly and time-consuming it was to generate shipping labels for thousands of different packages.
To address this problem, they set out to create a platform that would simplify the complicated and frustrating parts of learning how to ship. This would allow small entrepreneurs to handle logistics themselves and avoid a reliance on expensive third-party fulfillment services.
The platform also reduces costs for the small business owner who simply does not have the volume to negotiate better rates with postal services. To that end, Pirate Ship partnered with the United States Postal Service (USPS) to provide access to multiple package-shipping options. For international shipping, there is also integration with the United Parcel Service (UPS) which is available in approximately 117 countries and territories.
Using Pirate Ship software, the user can import eCommerce orders from their store or marketplace, print the shipping label, and automatically post parcel-tracking information back to the store. Today, thousands of small businesses buy USPS and UPS labels with Pirate Ship daily.
Pirate Ship revenue generation
So how does the company make money?
Most shipping software companies charge a monthly access fee and also make money by adding markup on top of the actual postage cost. However, Pirate Ship makes money through a partnership with the USPS and UPS. The nature of this partnership is somewhat opaque, but there is a reasonable chance the company is negotiating a cheaper shipping rate with postal carriers because of the parcel volume it can send their way.
In essence, Pirate Ship earns money from the difference between official commercial shipping rates and the unofficial, lower rate it negotiates with its partners. The difference may be as little as a few cents, so the Pirate Ship platform relies on substantial order volume to drive appreciable revenue.
The company also claims it has built a lean business based on modern ideas to maximize its viability. Among other things, this means advertising costs are reduced with the company relying largely on word-of-mouth to acquire new customers.
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