Today’s eCommerce is a world of personalized offerings scaled to global proportions. The eCommerce beauty sector, in particular, continues to dominate the industry – with shoppers spending close to $88 billion on beauty and cosmetics online in 2024 according to a recent report. Beauty brands that gain popularity experience rapid expansion but are expected to operate like smaller, niche, almost subculture-like endeavors. Grace & Stella, a fast-growing beauty and skincare brand with a strong presence in the US, Canada, UK, and EU, is an excellent example of how proper fulfillment is key to surviving this stage of development.
This case study highlights how the fulfillment challenges faced by Grace & Stella were solved through partnership, advanced technology, and strategic collaboration with ShipTop. As a skilled fulfillment provider, ShipTop focused on key points in their business operations, including seasonal peaks, accurate inventory management, and providing the same level of CX as before on a larger scale.
Grace & Stella’s key markets: US, UK + EU, Canada
Sales performance:
- Over $1,000,000 in sales per day in the US during Prime Day, on both days
- Over $400,000 in sales per day in Canada during Prime Day
- 1160% overall growth on Prime Day
- Ranked #1 in the Beauty category in Canada during Prime Day
- Ranked #8 in the Beauty category in the US during Prime Day
- Over 400% growth in the face mask/eye mask category on Amazon
Busiest sales periods: October-December
Overview of Grace & Stella
Grace & Stella perfectly exemplifies the new generation of eCommerce beauty and skincare brands. Not only is it a digital-first brand, it’s also one that prioritizes direct connections to its customers, with a 100% vegan and cruelty-free reputation; and not to mention its distinctive niche in the market.
While its primary focus is the US market (UK/EU following in its footsteps, and Canada being there by default), Grace & Stella implements an omnichannel model of selling, while placing a specific emphasis on Amazon, due to the fact that Amazon provides immediate customer feedback, as well as the possibility to segment the target customer base more efficiently. User comments (in turn, driven by customer experience) are a valuable tool for defining the business’ direction in a short- to middle-term perspective.
Grace & Stella’s product range includes popular items, such as face masks, eye masks, and various skincare products, with the energizing eye mask and hydrocolloid pimple patches being top sellers.
Grace & Stella’s Rapid Growth
Grace & Stella’s success is backed by impressive metrics that demonstrate its strong market presence and rapid growth in the eCommerce beauty industry.
Here are some figures, illustrating Grace & Stella’s commercial success:
- 1,160% growth on Amazon Prime Day
- Over $1 million in sales per day processed in the US
- #1 position in the entire beauty category in Canada on Prime Day, and #8 in the US.
Operational Challenges That Came Along
The growth experienced by Grace & Stella along with the associated surge in demand led to a number of challenges surrounding scale, ultimately putting strain on their operations.
This led to a critical need for additional support and emphasis surrounding inventory management, warehousing, staff management, and shipping operations – that at the moment were considerable challenges for Grace & Stella.
- Warehousing: Grace & Stella found they needed to bring their warehousing capacities in line with their growth. So one of the most obvious issues for the brand was the need to expand warehouse space, both extensively and intensively (i.e. by optimizing space utilization). Since beauty products require specific storing and transportation conditions, this problem was to be solved by strategically locating and properly managing warehouses in a new, more rationalized system.
- Inventory management: This was directly linked to the problem of balancing the stock levels with the demand, specifically in an omnichannel selling environment, requiring maximum visibility of products in stock and real-time updates. While Amazon was (and still is) Grace & Stella’s primary channel, the company also operates through other channels, which complicated the inventory monitoring process.
- Staff management: Rapid growth brought about the need for more hands on deck for packing, quality control, and shipping, which was diverting resources from other critical aspects of their business. This need, in turn, led to a solution that required both expanding the staff (and engaging the necessary logistics talent and expertise) and adopting a more technology-based approach.
- Shipping delays: As in its previous stage of development, Grace & Stella were remarkably customer-centric and they wanted to maintain this reputation while scaling to larger demand volumes. This involved ensuring timely and swift delivery, now tackling the problem of occasional delays that came with operational expansion.
The Search for a Reliable Fulfillment Partner
As Grace & Stella experienced rapid growth, the need for a reliable fulfillment partner was obvious and critical to their continued success. The growing numbers of inventoried items also exposed the need for advanced technological capacities and automation to be involved in their operations.
Accordingly, it was logical for Grace & Stella to prioritize the digitally-enabled fulfillment partner capable of handling increased complexity and volume while minimizing human error. Grace & Stella sought a special platform that would give them a clear overview of their operations and inventory levels; and provide comprehensive reports and updates, eliminating unnecessary back and forth communications in the fulfillment process.
The ideal provider for Grace & Stella would need to be available and proactive in supporting their business operations. Accordingly, the provider’s responsiveness was an equally important factor in choosing a provider. This involves timely information exchange and support when requested, as well as the ability to quickly resolve logistical issues and address any issues that arose during their busy periods, such as the holiday season from October through December.
According to Grace & Stella, key benefits of using ShipTop includes:
- ShipTop’s ability to integrate with different platforms like Amazon and Shopify, as it allowed them to manage their diverse sales channels efficiently.
- ShipTop’s flexibility in handling special projects, such as distributing hundreds of product samples, in order to support Grace & Stella’s marketing efforts and customer relationships.
- The same-day delivery was critical to Grace & Stella’s dedication to providing exceptional customer service.
- ShipTop enabled Grace & Stella to deliver products under Section 321, allowing for duty-free importation of low-value shipments. This capability further opened their brand for customers in the US.
- ShipTop’s all-in-one digital platform enables easy multichannel order and inventory management, as well as easy access to real-time inventory levels, and the latest inventory reports.
- In addition, ShipTop’s responsiveness highlights how their customer-focused approach attributes to their business growth.
The Outcome: Grace & Stella’s Fulfillment Transformation with ShipTop
As a result of its collaboration with ShipTop, specifically access to the warehouse network, technology integrations, and improved inventory management, Grace & Stella can now handle all surges in demand with full confidence.
In turn:
- Order information searches became faster and more accurate, enhancing customer service capabilities.
- Inventory management processes were optimized and automated where necessary to provide the comfortable level of visibility over stock levels.
- Communication became easier, with several extra steps eliminated, so that submitting requests and orders now works without unnecessary back-and-forth texting.
- Omnichannel fulfillment became stronger, helping manage not just Amazon orders, but Shopify and other channels.
- Customer satisfaction improved (no negative feedback reported during the partnership period) – ensuring faster delivery times.
With the introduction of ShipTop’s fulfillment strategy and services, the company can now process up to 2,000 orders daily. The median order processing time has also decreased and is currently around 98% of orders fulfilled same-day.
Meanwhile, the order accuracy rate has been improved, too, now at 99.8%, safeguarding Grace & Stella’s reputation and helping decrease the return rate.
Finally, due to automation and strategically placed warehouses, more orders are delivered within the predicted time frame, improving customer experience and laying the ground for further brand expansion that the updated fulfillment infrastructure will now be able to handle.
Looking Ahead to the Holidays
Apart from the general improvement of inventory management and fulfillment, ShipTop was able to focus on supporting the busy holiday season, notably from October through December. For Grace & Stella, this is the season marked by skyrocketing demand for beauty products, particularly face masks and eye patches. This one category alone sees around 400% growth on Amazon during this period.
“ShipTop is the perfect partner for the holiday season in that they are flexible – they are quick to react and fulfill orders, and also quick to find the perfect solution and cost for all projects. That’s why we even had a special program with them for sending samples. Plus, with them, you can pull the SKU history from the system to use the data for the Prime day”, says Ya Hsin Chen, the Supply Chain Manager at Gravitiq (who acquired Grace & Stella a while ago).
ShipTop’s practices that will continue to help navigate the high-pressure holiday season include:
- Implementing advanced inventory management software to maintain the stock levels within the optimal range and ensure quick response in case anything changes in the demand structure.
- Improving order information search: with instant information in real-time, the responsible staff can handle the surge in demand more flexibly.
- Stronger, tech-supplemented communication capacities, to minimize errors and delays; what could/should be automated, was automated, whereas human communication channels were freed up for handling situations only humans could resolve.
- Handling last-minute orders (especially during Christmas time). With the new processes and tech, Grace & Stella can extend the window for last-minute orders, which is equally beneficial for the customers and the company, seeing as how the relevance of orders peaks on Christmas Eve.
Ongoing plans for ShipTop and Grace and Stella Partnership
Grace & Stella is continuing to experience tremendous growth, especially in the Canadian and US markets. ShipTop’s additional capacities and know-hows have safeguarded the positive trend and allowed it to navigate through a challenging holiday season, while continuing the momentum.
The positive outcomes during the holiday season and Amazon Prime Day urged Grace & Stella to continue (and deepen) their collaboration to improve demand forecasting and inventory management even further.
As a vegan, eco-friendly, and cruelty-free brand, Grace & Stella remarked their appreciation for ShipTop’s sustainable packaging options, as well as the environmentally conscious methods used by ShipTop’s fulfillment centers.
At the same time, since the company is continuously expanding their product range, they plan to continue working with ShipTop to keep up with the demand as new items are introduced to the market.
Conclusion
Optimized inventory management, platform integrations, and responsive fulfillment was favorable to company growth and market presence extension. The improved visibility to inventory and order history, in turn, allows for better planning.
Ash Jamshidpour, CEO & Founder of ShipTop says, “With Grace & Stella, we essentially demonstrated how the impact of smart logistics is felt on the general brand level. What really happened is that once we could identify their challenges and solve them on the fulfillment level, market expansion and seasonal excellence were achieved almost effortlessly. In other words, fulfillment has a strategic value that can’t be ignored; it’s more than just a service.”
